Insurance is important for many things in everyday life, from home to auto, insurance is needed.
One of the factors that insurance agencies look at is an insurance score. An insurance score is determined by an algorithm that looks at your home insurer’s data and scoring model, one of three major credit bureaus, or a third-party company’s model.
Key Differences Between Credit & Insurance Score
While a credit score and an insurance score are both used to configure the cost of an insurance premium.
A FICO credit score considers things like:
- Payment history
- Types of credit
- Total amount owed
- New credit
- Length of credit history
An insurance score considers factors like:
- Accident history
- Insurance claim history
Insurance agencies each have their own processes for determining an insurance score and may use information from a client’s credit score to help determine an insurance score.
Generally, if a client has a good credit score and has been claim-free for a time, the client will likely have a favorable insurance score.
Can I Raise My Insurance Score?
Essentially, an insurance score goes hand in hand with a credit score and improving both scores follow the same steps. To improve your insurance score:
- Make payments on time
- Keep low balances on credit cards
- Don’t apply for new credit cards frequently
- Try to avoid accidents (at-fault accidents)
Following these steps will likely lead you to a good overall insurance score for homeowners or auto insurance.
Payne Insurance Group
Payne Insurance Group provides insurance for auto, home, commercial, and much more! Payne Insurance Group has partnered with over 13 businesses across the Rio Grande Valley, As a result, we have created a one-stop-shop for all types of insurance!
