Are you looking for auto insurance but your credit score isn't the best? Perhaps the insurance company you were looking at has told you that you're only eligible for bad credit auto insurance. This can be a real pain, but luckily there are some easy things you can do to get the insurance policy you need without too much hassle. By the end of this article, you'll have some ideas for how you can raise your credit or simply move on to another insurance provider.
Why Your Credit Score Matters
So why do insurance companies care about your credit score, anyway? The reason is that over the years, insurance providers discovered that people with lower scores tend to file more claims and cost more money. It's nothing personal against a particular person, but statistically people with higher credit scores are less expensive to insure. For that reason, insurance companies give these people higher rates.
Ways To Raise Your Credit Score
So what do you do if your score isn't as high as it could be? There are several good (and relatively easy) ways to improve your credit. First of all, if you don't have any credit you should look into getting a credit card. You don't even have to use it much, just having a line of credit will help your score.
If you do have a credit card, make sure to use it responsibly. Always pay your bills on time, whether it's the credit card bill, power, cell phone, or any other bill. This is a major contributor to your credit score. Check your credit report from the three major bureaus every year and make sure there are no errors. In general, you should be wise with your money and only spend within your means.
Save On Your Insurance
If you can, take a few months to improve your credit history. Contact the insurance company again and ask them to reconsider your premium. Another option for many people is to simply shop around for other insurance. Since each insurance company has a different formula for setting their rates, you might be able to find a much better deal from some other provider. Compare insurance quotes to see how much you could save.
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