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How Your Credit Is Impacting Your Car Insurance

If you are looking at the spike in the cost of your Car Insurance and feeling financially frustrated, you are not alone.

 

A recent Forbes survey shares that “Most Americans are overpaying for Car Insurance”.

 

The increases that you see in your car insurance are largely driven by auto insurance companies offering refund credits to provide relief amid COVID.
Coupled by the cost of car repairs and medical costs that have been driving up car insurance premiums annually.

Here Are Some Ways To Get Ahead Of It 

Make sure you aren’t missing any Credits

Your driving record, marital status, and payment history can impact the cost of Car insurance and can reduce your cost, be sure all of your credits are being applied.

Check Your Credit Before Calling To Negotiate

An insurance score isn’t a measure of your creditworthiness, but rather how risky you are from an auto insurance perspective, based on your creditworthiness.

Poor credit can mean a major jump in the price of your insurance, and good credit can lead to significant savings.

 

Poor credit raised rates 61% as compared to having average credit, based on our analysis of national rate data. Very good credit saved drivers more than 17% per year.

 

The best way to mitigate the Credit Challenges is to see if there are any errors on your Credit Report there were 444,000 Credit Report error complaints filed in 2020 compared to 277,000 in 2019. Of the errors, the most common is wrong addresses at 56%, misspelled names at 33%, and wrong names at 17%.   Removing these common errors can improve your credit score by 25 to 30 points incrementally each month and this positions you for better rates in your Car Insurance.

 

Make sure your Credit Card Utilization is under 30%

 

Utilization speaks to how you manage the “money” in the form of credit being extended to you by your Creditors. Review your Credit Card balances and pay your credit card debt down to under 30%. Either by creating a monthly strategy or all at once. The sooner the better.

 

Deal with your Debt

 

35% of one’s Credit Score is determined by your payment.
If once you look at your Credit Report and you have sorted through the errors & omissions within your Credit Report. Create a payment plan to pay off the debt, and have $0 balance debt removed from your Credit Report

 

Become Credit Visible

 

You would think that every American has a credit score. When in fact 1 in 10 Americans are “credit invisible”. This is where you do not have a credit score at all, or your credit history is so sparse that it’s unusable.

 

The good news in all of this with financial focus you and dollar discipline you improve your Credit Score within the next 3 months, right in time for rate renewals to use as a point of leverage to reduce the cost of your car insurance.

 

Need support with that?
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ABOUT THE AUTHOR

Every time I come in contact with someone I want to remind them of just how Power-full they truly are. Literal, #Purse Empowerment! I do this by empowering mostly women (some men) tackle their financial frustrations rather its saving their 1st $10,000, eliminating thousands of dollars in credit card debt, accelerating the process of paying off their student loan debt, boosting their credit scores, purchasing their first homes, converting their 1st homes into investments and even creating a business that will produce even more wealth for them to save, spend, share and invest.