Car Insurance And Your Credit Score
Topics: car. insurance, auto, credit, score, premium, cover, policy, cost, accident, claim
Did you know that your car insurance premiums may be affected by your credit score? Well, they can, and more and more automobile insurance companies are turning to this new system of premium determination. Not all companies are using this new system but many are, and if your company is using it, you should know a few things.
There is a philosophy behind this system. Some consumers may not agree with it, but there is one. After years of data collection, research, and study some car insurance companies have concluded that those individuals who have low credit scores are also the individuals who file the most claims. This assertion leads to some interesting questions, the most notable being: Do people with lower credit scores drive more poorly than those with higher scores?
The answer to that question is debatable. It might very well be that car insurance companies receive more claims from lower credit score individuals for reasons that have nothing to do with accidents. It is entirely possible that these same people live in communities where auto theft or vandalism is more prevalent than in other communities. There is also some debate over fraudulent claims, which would increase the overall number of claims associated with those who have lower credit scores.
Of course there is a flip side to this. What about those individuals who have low credit scores but have never had an accident or filed a claim? Is it fair for car insurance companies to increase their premiums? This is the crux of the debate, whether or not it is fair for an entire group of people to be penalized for the actions of a few.
In the past, car insurance companies have often used this broad stroke approach to setting premiums. For instance, we all know that younger drivers are usually assessed a higher premium, and this applies whether the driver in question has ever had an accident or not. All younger drivers pay more, or so it seems, and there is evidence that these younger drivers do have more accidents than people who are older.
On the issue of using credit scores, however, as a basis for determining the car insurance premiums that you may have to pay, there are a couple of things you can do. First, you should review your credit reports and scores to make sure they are accurate. You might be surprised at how often mistakes or omissions are found in these reports. Another option is to ask your car insurance company if they are using this system. You may find it more economical to switch to another company that does not use credit scores as a premium setting module. Lastly, if you discover your company is using this model, you may want to sit down with your car insurance representative and ask him or her for a waiver. This will only work if you have a clean driving record. They may be willing to offer you a better rate rather than lose you as a customer.
Joe Kenny writes for the UK personal finance sites offering loans, credit cards, mortgages and insurance products - www.ukpersonalloanstore.co.uk and www.nationsfinance.co.uk. For US residents seeking loans, refinance or mortgages visit www.rebuild.org
Previous Articles Highlighter:
Planning Ahead For Your Family Financial Security (1)
Be sure to take into account any insurance provided by your employer. If one spouse stays home with the children, they should also be insured since the surviving partner will need to pay for child care and household services.
Homeowners Can Consolidate (2)
They often have pretty low interest rates as well, so that helps to save quite a bit of money. Cash out loans are also simple to understand and regulate, especially if you acquire it from an effective financial company.
Business Sellers - Beware Of Potential Changes In The Capital Gains Tax (3)
MMC is an M&A advisory firm focused on middle market strategic business sellers. Dave a licensed business broker and a member of IBBA and the MBBI. Contact (630)325-0123 davekauppi@midmarkcap.com or www.midmarkcap.com
Tips For A Better Auto Loan (4)
Topics: loans, car, auto, finance, credit, bad, adverse, cost, best, deals, unsecured, personal, interest When you need to get a new car, you do not need to take the loan that the dealer offers to you.
Do Your Research To Find Low Cost Car Insurance (5)
After all, they all claim to offer the lowest rates with the best coverage. The only way to ensure you're getting the best deal possible is to research each company.
Losing Money On The Bourse? Try Forex Instead (6)
If you, as an individual want to be involved in forex trading, you must get involved through broker, or a financial institution. Individuals are also known as spectators, even if you are investing money because the amount of money you are investing is minimal compared to the millions of dollars that are invested by governments and by banks at any given time.
All About Fixed Mortgage (7)
Obtaining fixed rate mortgages is very similar to playing the stock market and a lot of it has to do with luck. The success or failure of the market will largely determine whether or not you will save money in the end.
Stocks Are Like Baseball Cards (8)
Actually, it is a complex combination of countless factors, but basically the prices are set as high as someone is willing to pay. The cards that are worth the most are from the best and most popular players.
Ways To Become A Successful Real Estate Agent (9)
The brokers of real estate should be knowledgeable, kind, trustworthy and efficient. The skills to attract more customers should be known. Some suggestions from experienced real estate agents help in furthering the business of real estate.
How To Use A Home Equity Loan Intelligently (10)
This could provide a low interest way to foot the college bill. It also will help you to be sure that at least some of the expenses are available in advance, instead of waiting for approval for a grant or other fund.
Types Of Investing In Real Estate And Land (11)
The special feature of this type of real-estate and land investing is that they enjoy an exclusive tax consideration by the government and the returns the investor receives are higher and are easily convertible to cash for the investor as compared with other types of investments.
Losing Your House Over Credit Card Debt (12)
The worst you could lose with an unsecured credit card is a good credit report, so why risk losing your home also with a secured credit card? Court helps people to learn about student loan consolidation programs.
Should You Fear A Law Suit From Collections? (13)
This is also illegal. If this occurs, make sure you use the person who was asked the information about you as a witness in your complaint against the credit agency.
Hot Texas County-Ft. Bend County New Homes (14)
Those who purchase or build homes in the county are well aware of the amenities already available. The county boasts good schools with low student-teacher ratios. Many of the schools are in fairly new plants, yet the tax base in Greater Houston is lower than the national average.
You Have Rights When It Comes To Collection Agencies (15)
If you are contacted any other time than during these hours, you are legally allowed to file a formal complaint against that collection agency. The collection agencies are only allowed to call you at your job if your employer is alright with it.
New Homes In Houston-Houston Custom Home Builders (16)
Some homebuyers may choose a location based on the school districts nearby. Others are more concerned with the neighborhood parks and recreation facilities. Public transportation and nearby medical facilities can be important for senior citizens who may have to dispense with automobiles in the future.
Getting Insurance Can Be Tricky (17)
The obtaining of car insurance can be a complex process because of all the necessary steps that need to be taken. There are also many insurance advisor's available to help customers get through these important steps of buying insurance without much difficulty.
Best Schools In Houston For Quality Education (18)
The 2007 list prepared by an organization called Children at Risk rates schools in Greater Houston for proficiency in mathematics and in English. The YES College Preparatory School is number two on the list.
Spouses Debt Is Your Debt (19)
There is really no solution, other than that you are going bankrupt, which is more of a resort than a solution. However, the way in which you handle your bankruptcy can greatly affect how much trouble you have in the future, and it can either create more or lighten the financial burdens you are carrying.
Residing In The Top Golf Course Communities In America (20)
You will want to pay attention to who the course designer is and whether he or she has other courses that are in their professional portfolio. It is also important to look at whether there are public or semi-private courses associated with the private course and whether the housing location that you choose will be acceptable in the future.
Newer Articles Highlighter:
Countrywide Mortgage Foreclosures Are Up - What This Means To You (1)
Countrywide Mortgage foreclosure can be avoided if you do not let things go too long. Talk to them right away if you are getting behind on your payments. Together you can come up with a plan to get you back on track and keep your home.
Consolidate Bad Credit As A Renter (2)
Companies greatly look down on this unstable pattern and do not approve loans for these types of people because of their poor credit history. It becomes very difficult for you to obtain a loan if you do not maintain a high credit score throughout your life.
Four Keys To Selling An Apartment Building Yourself (3)
This shows them in writing what they can expect from their apartment building investing venture. This analysis will also keep the asking price from being lowered as you have given concrete evidence about the value of the building that will be heeded by those interested in apartment investing.
Credit Union Vs. Banks (4)
The way to avoid and overcome these tricky financial regulations you have to continually be updated and educated on how financial programs actually work. Many customers who have desires to protect and build their finances interact primarily with banks, which are the most common and probably the most popular financial investment business in the world.
Apartment Buildings Will Make You Wealthy (5)
Nor will there come a time when you will need to place any of your income into this property, as there will always be enough tenant-generated income. Apartment building investing is considered a wise investment because as long as there are tenants, enough income is coming in to pay the loan and cover the taxes and other money needed to maintain the property.
The Real Estate Investor's Guide To Finding The Perfect Tenant (6)
If you aren't good with people or don't want the hassle of working on a relationship with your renter which isn't always an easy task, try utilizing the services of a property management group who can take care of the tenant for you.
The Pros And Cons Of Landlording (7)
Landlords are investors who purchase real estate and instead of selling it for a profit, retain the property and lease it to a tenant. Landlording for profit makes economic sense.
Ways To Control Tenants In Your Apartment Buildings (8)
This level of control is one of the keys to effective property management. It is the property management that is responsible for making certain that tenants pay their rent on time.
The Real Estate Investor's Guide To Understanding The Homeowners Association Community (9)
Here is a quick breakdown of some reasons why HOAs are nice to be involved with. Pros 1)HOAs provide an additional way to monitor your investment property. 2)Neighbors to your investment property are also monitored.
Learning To Win With Stocks Even If You're Losing (10)
In other words you must be prepared to lose in order to win. By doing this you will be in a much better position for making wise decisions later on based on your past experiences.
Mortgage Tips For The Frantic (11)
You'll repay your loan much earlier. When rates rise again you may not have to change your payment. Consider a fifteen or twenty year term. Try to pay off your mortgage quickly.
Ballon Mortgage And ARM Vs. FRM (12)
The following paragraphs help to address these two separate issues in a simple and concise manner. Mortgages have become somewhat complex, but the easiest definition is the money that is borrowed to purchase a house.
Here's Why The Rich Get Richer And The Poor Get Poorer (13)
In this case he is probably spending all his income on rent and living expenses and will have no disposable income to save or invest, and even if he does he's unlikely to be able to get rich from doing so.
The Importance Of Financial Equity In Lender Loans (14)
This is because it is perceived that the risk to the lender is much higher with a person who has bad credit. And advantage to a bad credit home equity loan is that it is available to homeowners who do not believe that they could get a loan.
10 Tips On Buying Real Estate (15)
No matter what, the money you need at closing should be available a few days ahead of time. This will ensure there is a smooth transaction. 5 - Get involved in the buying process.
Simple Tips For Getting Your Loan (16)
Simple. It's a mistake to only care about the interest rate; there are also arrangement fees and prepayment penalties to consider. Many 'no fee' credit lines have a pre-payment penalty.
The Environment Of The EU Banking System (17)
The motive for such kind of strategic decisions was the profit from a dynamic field that showed revenues increasing in a rapid rate. Furthermore, it is true that the Banking Sector throughout Europe has gradually restructured itself in order to be able to meet the challenges provoked by the unification that has recently reached the milestone of twenty-five member states.
How Do Credit Card Companies Get Rich (18)
These can be anywhere from $20 to $40 for the late fees. An over limit fee is when you exceed a credit limit even a penny and they will charge you from $20 to $40.
Searching Goverment Grant On The Internet (19)
2. Another important resource that they provide is an access to thousands of government grant providing programs. This is important because it helps people to choose the kind of federal grant they are really interested in and eligible for.
Debt Consolidation Explained (20)
Having a specific idea as to how you will begin to pay your debt and make your daily financial well-being much more secure leads to better money management. It also leads to peace of mind.