Credit rating and auto INSURANCE

[Anonymous]

My state (WA) allows auto insurers to check credit score and base insurance rate on that. 

I am assuming this is a relatively small factor, but what are they looking for? Any idea what score is high enough to max out whatever discount is available from credit score? Is it like auto loans, where once your score is over about 740 you get the best rate? 

I know this will be one of those "depends on the insurer" questions but I wonder if anyone has any insight into what is typical?

[takeshi74]

Like credit score models there's more than just one insurance score model out there and how the models evaluate data vary from model to model on top of insurers differing in their critieria.  The only insurnace scores I had access to were the ones provided by CK and it was dififcult to correlate scoring changes to report data changes.  The insurance scores reacted very differenty than the credit scores.

[Anonymous]

I am a living example that insurance scores are different. To this day, I still get mailers offering new insurance products.  I can't remember where to find the score, but it's on a scale, and whatever scale that is, it's the only one I remain high in (ok and ChexSystems) but I'll take what I can get.

Perhaps it's rated on claims? Bill pay?  Length of issuance?

[Anonymous]

Consumer Reports has an article that urges you to "avoid certain types of credit that insurance company credit-scoring models penalize you for: department-store credit cards, instant credit offered by stores to move big-ticket items; credit accounts from your local tire dealer, auto-parts store, or service station; and finance-company credit, including retailer credit cards."

http://www.consumerreports.org/cro/car-insurance/credit-scores-affect-auto-insurance-rates/index.htm

This link is from a longer recent discussion of the risks associated with having store cards in your credit profile:

http://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/Having-Store-Cards-Necessary/td-p/4277683

[Anonymous]

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@Anonymous wrote:

My state (WA) allows auto insurers to check credit score and base insurance rate on that. 

I am assuming this is a relatively small factor, but what are they looking for? Any idea what score is high enough to max out whatever discount is available from credit score? Is it like auto loans, where once your score is over about 740 you get the best rate? 

I know this will be one of those "depends on the insurer" questions but I wonder if anyone has any insight into what is typical?

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Not all that small. I requested quotes from several companies earlier this year when I decided to switch. The lowest quote for six months was $161 from Progressive. The next lowest was $259 from USAA. The difference? Progressive SP'd TU, which is my clean file. BTW, I'm also in WA St.

[Thomas_Thumb]

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@Anonymous wrote:

My state (WA) allows auto insurers to check credit score and base insurance rate on that. 

I am assuming this is a relatively small factor, but what are they looking for? Any idea what score is high enough to max out whatever discount is available from credit score? Is it like auto loans, where once your score is over about 740 you get the best rate? 

I know this will be one of those "depends on the insurer" questions but I wonder if anyone has any insight into what is typical?

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Auto insurance risk scores are a major factor used by insurance companies to determine your premium (there are a handful of states, such as CA, that forbid use of risk scores but the vast majority of states allow it.).

LexisNexis (LN) is one of the primary supplier of scores to companies for both Auto and property risk scores. These scores have a fair amount in common with credit scores but the models are different. You can purchase your scores directly through LN. I did - click on shortcut for more info.

http://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/Having-Store-Cards-Necessary/m-p/4283156#M100579

Food for thought links

https://www.esurance.com/info/car/myth-your-credit-score-doesnt-affect-your-insurance-rate

http://www.insurancescored.com/

https://personalreports.lexisnexis.com/lexisnexis_attract_auto_score/sample.jsp

http://insurance.mo.gov/consumers/auto/autoCredit.php