Your credit score affects your auto insurance [http://bloomington-auto-insurance.com] rate, even though many people don't know that fact. Unfortunately what this means is that when you down on your luck financially expect your auto insurance premiums to go up. Many people think this is equal to kicking a person when they are down. Ask any Floridian that has had trouble paying there bills how much their car insurance premiums have goon up.
According to the insurance industry spokesperson, your credit score is one of the most important indicators used to determine your auto insurance rate and their reasoning is that many people having financial troubles are more apt to let policies lapse, which causes a lot of problems if you have an accident during the grace period. Of course they also figure that a certain number in this category will fabricate an insurance claim just to get a little money. Those same figures also show that homeowners having trouble are more likely to commit arson.
These are common risk factors that affect anybody that is running late on their monthly insurance payments. Because those that are having financial problems are more apt to choose monthly premium payment plans, they often are constantly running late, which causes them to go into the questionable grace period. If your constantly in that grace period or they have to continually call you then your higher maintenance and they put you in the same category as those who chose to drive without insurance.
It is easy to see how this could be a factor that insurance companies would want to consider in setting premiums, however, many people have no idea that a premium increase is coming, which causes them to start the process all over, trying to find a lower insurance premium and experiencing derogatory ratings because of that factor. For most drivers and homeowners that have had no claims, this process is exasperating, and worst of all the insurance companies don't even take into account how punctual you are with your payments to them.
Many people don't realize that credit scores are considered ahead of tickets and accidents, which causes those with financial problems to pull their hair out. In fact, their premium might be more than somebody that has had numerous incidents.
Due to the fact that mortgage holder and lien holders require you to have auto insurance this problem becomes an issue that is hard to avoid. Driving without insurance will get you a ticket and your license suspended and all kinds of legal trouble should you be involved in an accident.
You never know when the insurance company will pull your credit report and re-figure your insurance premium, but you can rest assured they normally do it once a year. Even if you start to pay your bills on time it takes at least a year or more for this fact to start showing up on your auto insurance rates and premium. Unfortunately there is not much you can do if you have been having credit problems, just be aware that your auto insurance premiums are going to rise.
According to the insurance industry spokesperson, your credit score is one of the most important indicators used to determine your auto insurance rate and their reasoning is that many people having financial troubles are more apt to let policies lapse, which causes a lot of problems if you have an accident during the grace period. Of course they also figure that a certain number in this category will fabricate an insurance claim just to get a little money. Those same figures also show that homeowners having trouble are more likely to commit arson.
These are common risk factors that affect anybody that is running late on their monthly insurance payments. Because those that are having financial problems are more apt to choose monthly premium payment plans, they often are constantly running late, which causes them to go into the questionable grace period. If your constantly in that grace period or they have to continually call you then your higher maintenance and they put you in the same category as those who chose to drive without insurance.
It is easy to see how this could be a factor that insurance companies would want to consider in setting premiums, however, many people have no idea that a premium increase is coming, which causes them to start the process all over, trying to find a lower insurance premium and experiencing derogatory ratings because of that factor. For most drivers and homeowners that have had no claims, this process is exasperating, and worst of all the insurance companies don't even take into account how punctual you are with your payments to them.
Many people don't realize that credit scores are considered ahead of tickets and accidents, which causes those with financial problems to pull their hair out. In fact, their premium might be more than somebody that has had numerous incidents.
Due to the fact that mortgage holder and lien holders require you to have auto insurance this problem becomes an issue that is hard to avoid. Driving without insurance will get you a ticket and your license suspended and all kinds of legal trouble should you be involved in an accident.
You never know when the insurance company will pull your credit report and re-figure your insurance premium, but you can rest assured they normally do it once a year. Even if you start to pay your bills on time it takes at least a year or more for this fact to start showing up on your auto insurance rates and premium. Unfortunately there is not much you can do if you have been having credit problems, just be aware that your auto insurance premiums are going to rise.
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