What Is an Auto Insurance Score?
To get your best car insurance rate, you need a good insurance score. Here’s what that means and how to raise your score.
An auto insurance score is a number insurance companies look at to see how likely you are to file a claim.
Companies also look at auto insurance scores, which some call credit-based insurance scores, to determine if they should sell you a policy and how much they should charge you for it.
You’ll learn all about insurance scores in this article, which covers:
- What is a car insurance score based on?
- What is a good auto insurance score?
- What is my insurance score?
- How can I improve my auto insurance score?
What is a car insurance score?
A car insurance score is a three-digit number that is calculated using your claims history and certain details found in your credit report.
Insurers look at your auto insurance score to predict how likely you are to file a claim on any policy they sell you. They also look at this score when deciding:
- Whether they should sell you a policy.
- Which type of policy to offer you.
- How much you should pay for that policy.
If your insurance score suggests you may file claims down the road, a company may decide to not sell you a policy. Or they might sell you a policy but charge you a higher premium for it.
Companies can’t do this in all states, however. These five states currently prohibit insurers from using credit-based insurance scores to set rates or make certain other decisions regarding auto coverage:
Also, Oregon and Utah limit how and when insurance companies can use credit information.
Are credit scores and auto insurance scores the same thing?
Auto insurance scores and credit scores are not the same thing. The two scores are similar, though. And companies use some information pulled from your credit report to come up with your insurance score.
Here’s more about how auto insurance scores and credit scores are different:
|Score type||How it’s calculated||What it’s used for|
|Auto insurance score||
||To determine how likely you are to file a claim.|
||To determine how likely you are to repay a loan or line of credit.|
What is an auto insurance score based on?
In general, your auto insurance score is based on your accident history, your claims history and information pulled from your credit report.
Some of the information from your credit report that can impact your insurance score includes your:
- Length of credit history.
- Payment history.
- Use of available credit.
Each insurer uses a slightly different formula to calculate your auto insurance score, much like how the various credit bureaus use slightly different formulas to calculate your credit score.
While Progressive looks at your accident history, claims history and certain parts of your credit report to come up with your insurance score, for example, other companies might weigh them differently. Or they may look at other aspects of your insurance history as well, like late or missed payments, or lapses in coverage.
What is a good insurance score?
In most cases, a good auto insurance score is a high auto insurance score. Specifically, most companies consider a good insurance score to be 770 or higher.
Auto insurance scores can be as high as 997 and as low as 200. Drivers with higher insurance scores tend to file fewer claims, and in turn they usually pay lower rates for car insurance. The opposite is often true, too — drivers with lower insurance scores tend to file more claims and pay higher car insurance rates.
Does this mean you’ll always pay lower rates for auto insurance if you have a good insurance score? Not necessarily. Along with your insurance score, companies consider several rate factors while calculating your premium. Some of the most common of these factors are your:
- Marital status.
- Vehicle make and model.
What is my auto insurance score?
If you want to check your auto insurance score, you’ll probably have to pay for it.
To see your LexisNexis auto insurance score, you need to pay a one-time fee of around $13. To see your FICO auto score, you need to pay a monthly fee of about $20.
Your insurance score also may be included in an adverse action notice from an insurance company. You may receive an adverse action notice if an insurer denies you coverage, raises your rates or cancels your policy. In that case, you won’t have to pay to see your insurance score.
Is your credit score high? And have you rarely or never filed a car insurance claim? If so, save your money. Your auto insurance score should be high, too.
How to improve your insurance score
The best way to improve your auto insurance score is to improve your credit score. When your credit score goes up, your insurance score often goes up, too.
To improve your credit score, and thus your insurance score, try these tips:
- Pay down any debt you have as quickly as possible.
- Make loan payments on time.
- Don’t open or apply for new lines of credit until your score is where you want it to be.
Do all of the above and not only should your credit score and auto insurance score improve, but you should save money on car insurance, too.
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