Many insurance companies use an auto insurance score to determine your car insurance quote. It considers your financial history and how responsible you are to anticipate the likelihood of a claim.
A good vehicle insurance score can help you save money on your premiums, while a negative one can result in you paying more each month. If you obtain your insurance score and discover it isn’t quite where you want it to be, there are a few things you may do to improve it.
Because finances account for a large portion of an insurance score, taking steps to improve your credit score may positively impact your insurance premiums. So following are some tips on how you can improve your insurance score.
Pay Bills
Paying your bills on time is a great way to boost your credit score and, by extension, your vehicle insurance score. Make calendar reminders, post sticky notes on your desk, or do whatever it takes to ensure that your payment is paid on time. This easy task can improve your insurance score dramatically.
Limit The Number of Credit Accounts
A high number of credit accounts opened is a red flag for your insurance score. We understand that sign-up bonuses are appealing, but you don’t want to open several credit cards in a short period. It can make you appear a high-risk borrower, lowering your insurance score.
Have Low Outstanding Balance
It’s excellent for your vehicle insurance score if you can demonstrate that you’re using credit. You should be utilizing 20-30% of your credit line. More than that, it appears that you cannot balance your finances and cannot afford to repay what you owe.
Review Your Credit Report
You are entitled to one free and secure annual credit report from each of these sites under the Fair Credit Reporting Act: Equifax, Experian, and TransUnion. Spread them out throughout the year to keep track of your credit score. When reading your credit report, double-check that all of the information appears to be correct.
Check to determine if you were wrongfully accused of being late with a payment. Or perhaps you simply see penalties that you believe you should have. In either case, reading your credit report is a useful starting point for determining your current credit score and areas for improvement.
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