Insurance FICO score and inquiry effects??

[Lucid08]

Hi all,

Earlier this year I purchased a "project" car to spend time rebuilding over the summer months. Over the last few days I've managed to get the car going and now I need to get it registered/tagged and insured. Since early last week I've called several different insurance companies in an attempt to "shop around" for the best rate. I've had insurance on my existing car for many years now, so I'm not in the "without insurance" category as I've done this shopping around. I also have a perfect driving record with no claims or accidents -ever-, so I know that is not a factor in the quotes I am being offered.

One thing I've noticed, is that after contacting the 2nd insurer for quotes, each successive company I have contacted has resulted in higher and higher quotes being given for both 6 month and 1 year premiums. The odd thing here is that the first and second companies I contacted actually bested the quotes offered by my current insurance company by quite a bit, but after that the quotes have gone up almost predictably. On friday I spoke with my current agent about this and he told me that insurance companies do indeed pull some type of credit score along with obtaining some kind of information from some database when you apply for insurance, but he says he is not sure if this score is affected by "inquiries" or not.

In all I have contacted 9 different companies, but only the first two gave me quotes that beat what my current insurer quoted. The rest all got higher by 3.00-5.00 with each successive quote request.

Do insurers use a Fair Isaac type of score for insuring purposes, and is it affected the same as the standard FICO credit score by inquiries? There just doesnt seem to be any other logical explanation for the quotes to increase like they are doing.

[haulingthescoreup]

They might be "softing" your credit reports. Insurance underwriters have found that those with credit problems are more likely to file insurance claims as well, so this practice is growing more common.

However, they can't see that other companies are softing you. You're the only one who can see the list of softs.

Now, if a couple of them pulled hard inqs, that might be different, because that would probably drop your scores. I'd check your reports, and if there are any hard inquiries, call them and ask them to re-code.

But unless there were some hard inqs that popped up, I don't know why the quotes would be increasing. Maybe you called the companies that you thought would give you the best deal first, and they did, and the subsequent companies were those you expected/ suspected wouldn't be as good?


eta: oh, and congrats on getting the project up and running! My husband rebuilds planes. Talk about a project!

Message Edited by haulingthescoreup on 08-31-2009 04:26 PM