Innovative Financial Solutions
Education, Restoration and Optimization
How Credit Affects Your Insurance Premiums
We work with local insurance companies who are concerned about their client's high premium payments. We work with you at their request to increase your score, which increases your buying power and can lower your premiums.
•Because a credit report generally contains information from multiple lenders, it gives insurers a broad view of your overall credit management history. It contains many pieces of information that reveal many different aspects of how you manage your finances.
•Multiple studies have demonstrated a very strong relationship between credit management behavior and insurance losses.
•
This makes sense: individuals who closely and cautiously monitor and manage their finances also tend to be the same individuals who manage their property cautiously – for example, servicing their automobile regularly, replacing worn tires before a problem occurs, replacing or repairing a damaged roof before winter storms can cause damage.
•
The bottom line: your credit report helps insurers to assess the potential insurance risk you are likely to represent. However, it is important to note that your credit report is only one of many pieces of information that insurers use. Other types of data that insurers use include application or policyholder information, claims history, motor vehicle reports for auto insurance, and property inspection reports for homeowners insurance.
•
Only your insurer can tell you if they use credit data and insurance scores in their underwriting decisions, and if they do, how that information is used along with other information to make their underwriting decisions. Your insurance company ultimately determines how your credit history impacts your premium. If you would like to discuss what impact your credit history may have had on your premium, positively or negatively, please contact your insurer to discuss in further detail.