topic Re: Auto Insurance Score in Understanding FICO® Scoring

Auto Insurance Score

Anonymous — Tue, 09 Apr 2019 22:38:13 GMT

I was looking at credit karma 3 months ago and I saw auto listed, ( which I had never seen on there before) and it takes you to an auto insurance score. What affects your auto score, I have never heard of that until very recently, and now that my insurance quote has gone down I am curious? I saw an increase in my score, (maybe 5 weeks ago) and I just got my insurance quote for my renewal which has gone down $78. Obviously my quote was much lower because of my score increase, but I am not really sure how to increase it further, which I would like to do. It has never gone down, from my knowledge, although I did just recently find out about that score, so maybe it has gone and I just never noticed. (I hope this is the right place to post this)

Re: Auto Insurance Score

Anonymous — Tue, 09 Apr 2019 23:23:56 GMT

I am curious as well.

Re: Auto Insurance Score

Trudy — Wed, 10 Apr 2019 13:31:41 GMT

I hadn't noticed it either until a few months ago. I read up on it and contacted my Insurance company and inquired and they stated they could do a review. Rates could go up or down. My rates have been up and down but only by a few dollars. $10 at the most. I never inquired about the decrease but have inquire about the increase and was told it's due to market changes.

But I will be asking for a review because it would be impossible for that score not to be better than it ever was so I'll see.

I'd be curious to find out which CB they would use since CK only provides TU's auto score. No clue what the other bureaus auto score is.

Re: Auto Insurance Score

Anonymous — Wed, 10 Apr 2019 14:06:37 GMT

@Trudy wrote:
I hadn't noticed it either until a few months ago. I read up on it and contacted my Insurance company and inquired and they stated they could do a review. Rates could go up or down. My rates have been up and down but only by a few dollars. $10 at the most. I never inquired about the decrease but have inquire about the increase and was told it's due to market changes.

But I will be asking for a review because it would be impossible for that score not to be better than it ever was so I'll see.

I'd be curious to find out which CB they would use since CK only provides TU's auto score. No clue what the other bureaus auto score is.

I would like to know the other ones as well, I hope someone knows something about this score, I really want to know what effects this score. What would cause you to get a decrease or an increase. Mine went up 80 points when I noticed it on credit karma (they sent me alert about it in my email) and it recently went up a very small amount again. I also wonder if there is a separate auto insurance score for fico and vantage score. I have never actually gotten an increase in my insurance cost though (I have a flawless driving record) so I was shocked to even see a decrease because I am not even paying that much already, let alone an almost $80 decrease. It could just be my insurance though I guess, I keep getting quotes from all state, and progressive (I used to be with both of them) however they quote a much higher amount then I get with geico.

Re: Auto Insurance Score

Anonymous — Wed, 10 Apr 2019 15:47:10 GMT

These scores are known in the trade as CBIS: Credit Based Insurance Scores.

There are two main CBIS. One is made by LexisNexis and is drawn on Equifax data. The other is not quite as widely used; it is made by TransUnion and is drawn on TU data, and is available for free through Credit Karma.

CBI scores are like FICO scores in a number of ways. One important way is that the score is based purely on the credit data from one of the three big bureaus. Thus, for example, the LexisNexis CBIS does not draw on LN's driver history data, since those data are not part of EQ.

Other similarities between FICO and CBI scores:

* They are not influenced by zip code, city, or state. Nor are they influenced by gender, race, religion, age, educational background, etc.

* They are not influenced by the color, make, or model of the car you drive.

* They are strongly influenced by the traditional "derogs": Late payments, collections, chargeoffs, etc.

* They are strongly influenced by CC utilization.

Scoring factors shared but upon which FICO and CBI scores place different levels of weight:

* New credit. Inquiries and new accounts hurt you more in CBI scores and longer. (E.g. inquiries affect you for 24 months rather than 12 months.)

* Too many accounts. This has very little effect in FICO (you can probably have 15 accounts with no penalty and 50 accounts with little penalty). But in CBI scores you begin to take a penalty at a much lower number -- maybe 6-7?

* Average Age of Accounts and Age of Oldest Account.

Scoring factors not present in FICO but which are present in CBI models:

* The mere presence of store cards hurts you.

* The mere presence of "auto-related" accounts (Firestone, Pep Boys, etc.) hurts you.

* Average Credit Limit (as a dollar value). The last I looked, there was no CBIS penalty if your ACL was above $10,600. Less than that and you begin to take stiffer and stiffer penalties.

* Total dollar value of installment debt affects you as does total dollar value of revolving debt.

* If your oldest account is a loan, there's a penalty for that. CBIS like it better when your oldest account is a credit card. The penalty gets stiffer if the loan is much older than your oldest credit card. (Yeah, this scoring factor is a bit strange.)

Note that nearly all insurers who use CBI scores couple them with additional considerations: your age, the color, make and model of your car, your zip code, your driving history, etc. Those factors are not present in the CBIS itself, however.

Finally note that a CBIS is used to assist the insurer in estimating the probability that you will file a claim. That's not the same thing as the probability that you will get in a wreck, get a speeding ticket, or otherwise engage in dangerous driving.

Re: Auto Insurance Score

Anonymous — Wed, 10 Apr 2019 15:51:05 GMT

Note also that an 810 FICO 8 score is amazing, whereas an 810 CBIS is already looking pretty lame, maybe a C minus if you used the grades we all got back in high school.

So be careful how you evaluate any CBIS score.

Re: Auto Insurance Score

Anonymous — Wed, 10 Apr 2019 15:52:54 GMT

@Anonymous wrote:
These scores are known in the trade as CBIS: Credit Based Insurance Scores.

There are two main CBIS. One is made by LexisNexis and is drawn on Equifax data. The other is not quite as widely used; it is made by TransUnion and is drawn on TU data, and is available for free through Credit Karma.

CBI scores are like FICO scores in a number of ways. One important way is that the score is based purely on the credit data from one of the three big bureaus. Thus, for example, the LexisNexis CBIS does not draw on LN's driver history data, since those data are not part of EQ.

Other similarities between FICO and CBI scores:
      * They are not influenced by zip code, city, or state. Nor are they influenced by gender, race, religion, age, educational background, etc.
      * They are not influenced by the color, make, or model of the car you drive.
      * They are strongly influenced by the traditional "derogs": Late payments, collections, chargeoffs, etc.
      * They are strongly influenced by CC utilization.

Scoring factors shared but upon which FICO and CBI scores place different levels of weight:
      * New credit. Inquiries and new accounts hurt you more in CBI scores and longer. (E.g. inquiries affect you for 24 months rather than 12 months.)
      * Too many accounts. This has very little effect in FICO (you can probably have 15 accounts with no penalty and 50 accounts with little penalty). But in CBI scores you begin to take a penalty at a much lower number -- maybe 6-7?
      * Average Age of Accounts and Age of Oldest Account.

Scoring factors not present in FICO but which are present in CBI models:
      * The mere presence of store cards hurts you.
      * The mere presence of "auto-related" accounts (Firestone, Pep Boys, etc.) hurts you.
      * Average Credit Limit (as a dollar value). The last I looked, there was no CBIS penalty if your ACL was above $10,600. Less than that and you begin to take stiffer and stiffer penalties.
      * Total dollar value of installment debt affects you as does total dollar value of revolving debt.
      * If your oldest account is a loan, there's a penalty for that. CBIS like it better when your oldest account is a credit card. The penalty gets stiffer if the loan is much older than your oldest credit card. (Yeah, this scoring factor is a bit strange.)

Note that nearly all insurers who use CBI scores couple them with additional considerations: your age, the color, make and model of your car, your zip code, your driving history, etc. Those factors are not present in the CBIS itself, however.

Finally note that a CBIS is used to assist the insurer in estimating the probability that you will file a claim. That's not the same thing as the probability that you will get in a wreck, get a speeding ticket, or otherwise engage in dangerous driving.

Very thorough response, and answered any question I could possibly have.The only other question I could possibly have is how do you know which one your insurance company uses? Do I just have to call them or is there a list of that somewhere?

Re: Auto Insurance Score

Anonymous — Wed, 10 Apr 2019 15:56:26 GMT

@Anonymous wrote:
Note also that an 810 FICO 8 score is amazing, whereas an 810 CBIS is already looking pretty lame, maybe a C minus if you used the grades we all got back in high school.

So be careful how you evaluate any CBIS score.

Here I was thinking my 855 (the one listed on credit karma was good), so what would be considered good? It is out of 950, I can't imagine mine would go up at all anymore. Several factors are limiting me, I have medical collections, I have a lot of accounts, and my oldest account is a loan. In addition to my oldest account being a loan it is WAY greater then my oldest credit card. So I am guessing 855 is where I am stuck for a while.

Re: Auto Insurance Score

Anonymous — Thu, 11 Apr 2019 01:53:16 GMT

@Anonymous wrote:
Note also that an 810 FICO 8 score is amazing, whereas an 810 CBIS is already looking pretty lame, maybe a C minus if you used the grades we all got back in high school.

So be careful how you evaluate any CBIS score.

I'm inclined to believe you about that 810 CBIS score, since mine is already 820 with only 1yr 4mos of credit history and only 4 months of revolving credit history.

But TransUnion has a page about insurance scores where they say a 770 or above is good. This page is dated 8/31/2015, so maybe you have more recent information?

How Your Credit History Can Impact Your Auto Insurance Score

"Typical insurance scores range from 200 to 997; a good score is usually around 770 or higher."

Re: Auto Insurance Score

Trudy — Thu, 11 Apr 2019 02:22:37 GMT

Just want to add this to the topic in addition to all the great detail CGID provided. It is provided by CK after a few clicks. To support some of the points made by CGID my score was 863 in 5/2018 before a MTG re-fi and new CC hit my report in August and re-fi inquiry hit in June. Afterwards it dropped to 832 out of 950 and is currently 842. AoOA is 23y, 1m, AAoA 11y 8m and AoYa 8m.

Re: Auto Insurance Score

Anonymous — Thu, 11 Apr 2019 08:56:51 GMT

@Cassie Remember what they say good FICO scores are… Compared to very good or excellent ... lol

Re: Auto Insurance Score

Anonymous — Thu, 11 Apr 2019 13:16:26 GMT

Our myFICO contributor Thomas Thumb posted the following over at Credit Karma back in Nov 2015. You'll see that an 810 is classified as Poor. It would be interesting to hear TT chime in on this thread now. Does he think that the interpretative range he received in Nov 2015 is likely to be roughly accurate today?

https://www.creditkarma.com/question/what-is-a-good-auto-insurance-score

Credit Karma's free credit based Auto insurance score comes directly from TransUnion (TU). I purchased my score direct from TU and it matches what CK lists. Listed below is an approximate rating breakdown by category [score range 150 to 950].

TU Auto insurance score .... Category Rating

895 and above .........................Very Good

860 to 894 ............................... Good

825 to 859 ................................ Fair

760 to 824 ................................ Poor

759 and below .......................... Very Poor

My Auto insurance score is 902 (from CK and direct from TU). For comparison my TU Fico 8 Auto enhanced score was 897 [range 250 to 900] and TU VantageScore 3.0 is 833 [range 300 to 850]

Note: credit based Auto insurance scores do not consider driving record or prior claim history. Insurance companies look at those factors and your zip code location to develop a composite risk score for determining insurability and premiums.

Re: Auto Insurance Score

Thomas_Thumb — Thu, 11 Apr 2019 18:37:59 GMT

@Anonymous wrote:
Our myFICO contributor Thomas Thumb posted the following over at Credit Karma back in Nov 2015. You'll see that an 810 is classified as Poor. It would be interesting to hear TT chime in on this thread now. Does he think that the interpretative range he received in Nov 2015 is likely to be roughly accurate today?

https://www.creditkarma.com/question/what-is-a-good-auto-insurance-score

Credit Karma's free credit based Auto insurance score comes directly from TransUnion (TU). I purchased my score direct from TU and it matches what CK lists. Listed below is an approximate rating breakdown by category [score range 150 to 950].

TU Auto insurance score .... Category Rating
895 and above .........................Very Good
860 to 894 ............................... Good
825 to 859 ................................ Fair
760 to 824 ................................ Poor
759 and below .......................... Very Poor

Note: credit based Auto insurance scores do not consider driving record or prior claim history. Insurance companies look at those factors and your zip code location to develop a composite risk score for determining insurability and premiums.

As one would expect rating classification for a given CBIS score ties to the model used to generate the score. No such thing as a universal score rating across CBIS models. Pasted below are CBIS ratings direct from the model creators.

The above table, culled from looking at CK summaries, remains a reasonable approximation of TU's official rating for Good and Very Good. However, it is overly harsh when assigning ratings of Fair, Poor and Very Poor based on letter grades from TU assuming [A = Very Good, B = Good, C = Fair, D= Poor, F = Very Poor]

For more discussion on CBIS look at posts in the below link

https://ficoforums.myfico.com/t5/General-Credit-Topics/Free-Transunion-Credit-Based-Insurance-Scores-thru-CK/m-p/5262099#M261741

TransUnion CBIS (uses TransUnion CRA data and other info):

LexisNexis CBIS (uses Equifax CRA data and other info):

The above from LexisNexis lacks granularity.

Ultimately insurance companies segment score into finer increments such as done by West Bend insurance in the below chart:

Re: Auto Insurance Score

Medic981 — Sat, 31 Aug 2019 05:47:07 GMT

@Anonymous wrote:
Our myFICO contributor Thomas Thumb posted the following over at Credit Karma back in Nov 2015. You'll see that an 810 is classified as Poor. It would be interesting to hear TT chime in on this thread now. Does he think that the interpretative range he received in Nov 2015 is likely to be roughly accurate today?

https://www.creditkarma.com/question/what-is-a-good-auto-insurance-score

Credit Karma's free credit based Auto insurance score comes directly from TransUnion (TU). I purchased my score direct from TU and it matches what CK lists. Listed below is an approximate rating breakdown by category [score range 150 to 950].

TU Auto insurance score .... Category Rating
895 and above .........................Very Good
860 to 894 ............................... Good
825 to 859 ................................ Fair
760 to 824 ................................ Poor
759 and below .......................... Very Poor

My Auto insurance score is 902 (from CK and direct from TU). For comparison my TU Fico 8 Auto enhanced score was 897 [range 250 to 900] and TU VantageScore 3.0 is 833 [range 300 to 850]

Note: credit based Auto insurance scores do not consider driving record or prior claim history. Insurance companies look at those factors and your zip code location to develop a composite risk score for determining insurability and premiums.

Your auto insurance score is not correct. Please see below...

Smart Credit’s auto credit score range is between 350 and 850:

Great or Excellent

775-850

Good or Very Good

685-774

Normal or Average

615-684

Below Normal or Poor

515-614

Bad or Very Bad

350-514

Re: Auto Insurance Score

iv — Sat, 31 Aug 2019 20:55:00 GMT

@Medic981 wrote:
Your auto insurance score is not correct. Please see below...
Smart Credit’s auto credit score range is between 350 and 850:
Great or Excellent
775-850
Good or Very Good
685-774
Normal or Average
615-684
Below Normal or Poor
515-614
Bad or Very Bad
350-514

You appear to be quoting from this page:

https://blog.smartcredit.com/2010/05/01/what-is-an-auto-credit-score/

...which is about Auto Credit Scores, not Auto Insurance Scores. Not the same thing. The ranges listed by CGID and TT are correct for the Transunion Auto Credit-Based Insurance Score (TU Auto CBIS). LexisNexis also has their own Auto Insurance Score product, with a different range.

Also, that page has several issues - it correctly mentions FICO Auto Industry Option Scores, but then proceeds to show a score range table based on 350-850. (But FICO Industry Options are on a 900-point scale.) It also tries to imply that their (paid!) service will provide those scores, when it fact it only supplies VantageScores and their own "house-brand" internal scores.

See section 7.1 here: https://www.smartcredit.com/help/terms-and-privacy/service-agreement.htm

7.1. Our Scores

When you become a Member, we will receive your VantageScore® Credit Score from one or more credit bureaus. However, we reserve the right to use our own internally developed score if necessary depending on the ability of a given credit report to generate a normal credit score.

All of our Scores may not be used to grant credit. They are estimates and are for educational purposes only.

It's basically creditkarma.com (EQ/TU) plus credit.com (EX), but with a monthly fee!

Looking at the rest of the "smartcredit" site... don't take them as a credible source for anything, and certainly don't pay them for anything!

The TU Auto CBIS from CreditKarma is at least a real insurance score, and CK doesn't charge for it (or for the EQ/TU VantageScores).