Auto Insurance Scores: What They Are & Why They Matter
Auto insurance scores are ratings based on information from credit reports that insurers use to estimate the likelihood that drivers will file a claim. Insurance scores have different ranges depending on the scoring company, but lower scores always mean drivers are riskier to insure and will likely pay a higher premium.
key things to know about car insurance scores
- Car insurance scores are based on your credit history, not your driving record.
- Scores correlate with the likelihood that a driver will cost the insurer money in the future.
- insurance scores typically come from fair isaac corporation (fico), lexisnexis, and transunion.
- A good insurance score is about 700 or higher, although it differs by company.
- You can improve your auto insurance score by checking your credit reports for errors, managing credit responsibly, and building an extensive credit history.
get your free car insurance score
compares common auto insurance scores
Your auto insurance score, like your credit score, is an indicator of your risk. and auto insurance scores are largely based on the same information as traditional credit scores. But instead of using that information to assess your position as a borrower, it’s filtered through a different lens, producing results tailored to the insurance industry. For example, the table below shows how FICO considers different aspects of your credit report when calculating your auto insurance score.
fico insurance score rating factors
how to get your car insurance score
Unlike credit reports, you are not entitled to any free auto insurance scores. The only way to check your auto insurance score is by calling LexisNexis. the other two big companies do not provide scores to consumers.
If you’ve always paid your bills on time and have an extensive credit history, you can be sure that you probably have a high auto insurance score. after all, your insurance score is largely tied to your standard credit score.
what is a good auto insurance score?
A good auto insurance score is usually above 700, and a higher score is always better. But it’s important to remember that each auto insurance score provider and auto insurance company has their own definition of a “good” score.
good auto insurance scores by provider
Learn more about what a good auto insurance score means.
how to improve your car insurance score
1. improve your credit score.
When your credit score goes up, your auto insurance score usually goes up too. and vice versa. for example, people with no credit pay an average of 67% more on auto insurance than those with excellent credit. And looking at car costs more broadly, excellent credit will save you more than $6,000 in interest on a five-year car loan, compared to fair credit.
In other words, you should probably check your most recent credit score, which you can do for free at wallethub. consulting our best tips to improve credit would not hurt either.
get your latest credit score – 100% free
2. be as financially responsible as possible.
Because your standard credit score greatly affects your auto insurance score, you should try to improve your standard score. this means paying bills on time, having low credit utilization, and making other good decisions. For other ways to improve your credit, check out the wallethub guide.
3. be a safe driver.
Things like speeding tickets and insurance claims don’t factor into your auto insurance score. but they are considered along with your score when insurance companies determine your premium. And that means your ability to avoid accidents and citations has a big impact on your ability to save money. making improvements in this area could also save your life.
4. stay on top of your credit history.
By joining wallethub for free, you’ll have access to daily updated versions of your credit score and report, as well as personalized credit analysis that will advise you on how to improve.
At the end of the day, auto insurance scores won’t have as much of an impact on your life as credit scores. but they are still an important tool that you should know how to use.