An auto insurance score, or a credit-based insurance score, is similar to a credit score. The main difference is that your auto insurance score predicts your likelihood of filing a claim as opposed to your odds of defaulting on a loan or line of credit. By analyzing years of data on credit scores and car accidents, insurers have found certain connections between financial misbehavior and motorist mistakes. In other words, people who are less responsible with credit are also more likely to have accidents. And insurance companies consider such behavioral patterns when pricing their policies.
But your own driving record has nothing to do with your auto insurance score (insurers will still consider it when they calculate your premium, though). Your score represents different components of your credit history, graded from an insurer’s perspective. There are just a few exceptions to this, as California, Hawaii, and Massachusetts don’t allow credit history to affect auto insurance. Other states may have requirements to notify you when your score is used this way, too. It’s always helpful to contact your state government to find out your rights.
So if you’re planning to buy or lease a car in the near future, you’ll want to understand how auto insurance scores work beforehand. Below, we’ll compare the most common types of auto insurance scores and offer some tips on how to check and improve your ratings.
Comparing Common Auto Insurance Scores
Your auto insurance score, like a credit score, is an indicator of your risk. And it plays a role in whether you can get approved for a or are offered a different one, as well as what you wind up paying.
Auto insurance scores are tailored specifically to assess your risk as an insurance consumer, and most of them are largely based on the same information as traditional credit scores. But rather than using that information to assess your position as a borrower, it’s filtered through a different lens. In other words, the different purpose leads to different results. Plus, car insurance companies use other information, like claims history and your driving record, as supplements in determining your approval.
That’s what the major auto insurance scores have in common. There are differences, though, including what score range they use and where their credit data comes from. You can see how the most popular types compare in the table below.
Here are the three major auto insurance scores:
|Provider||Auto Insurance Score||Score Range||Credit Report Used||Cost|
|Fair Isaac Corporation (FICO)||FICO Auto Score 9 XT||250-900||TransUnion||$19.95/month (part of FICO Essentials 1B package)|
|LexisNexis*||LexisNexis® Attract™ Auto Insurance Score||500-997||Equifax||$12.95 (one-time)|
|TransUnion||CreditVision Auto Score||300-850||TransUnion||Not specified (contact bureau for more info.)|
How To Get Your Auto Insurance Score
Unlike credit reports, you’re not entitled to any free auto insurance scores. But the good news is you won’t have to purchase them often. You don’t need to track your auto insurance score as closely as your credit score. Doing so before shopping for car insurance is enough.
And if you’ve always paid all your bills on time and never filed a car insurance claim, for example, you can rest assured that you probably have a high score. That’s especially true if you’ve been preapproved for the lowest advertised rates. After all, your auto insurance score is largely tied to your standard credit score.
What Is A Good Auto Insurance Score?
Simply knowing your score isn’t enough. You need to know what it means for your auto insurance payments. And that means you need a benchmark. The tricky thing is each score provider has a different definition of a “good” score.
FICO calls 700+ good. LexisNexis says 776+. And TransUnion doesn’t specify. But higher is always better.
How To Improve Your Auto Insurance Score
It’s important to again stress the connection between auto insurance scores and credit scores. When your credit score goes up, your auto insurance score usually does, too. And vice versa. For example, people with no credit pay an average of 65% more for car insurance than those with excellent credit. And looking at car costs more broadly, excellent credit will save you more than $6,000 in interest on a five-year car loan, compared to fair credit.
In other words, you should probably check your latest credit score, which you can do for free on WalletHub. Checking out our top credit improvement tips wouldn’t hurt, either.
But you shouldn’t stop there. There are several things that you can do to improve your auto insurance score. In particular, make sure to:
- Be as financially responsible as possible. Since your standard credit score heavily affects your auto insurance score, you should be aiming to improve your standard score. This means paying bills on time, having low credit utilization, and making other good choices. To learn about other ways to improve your credit, check out WalletHub’s guide.
- Be a safe driver. Things like speeding tickets don’t factor into your car insurance score. But your claims do. And that means your ability to avoid accidents has a big impact on your standing. Sure, not all claims come from accidents. And not all accidents are preventable. But adhering to the speed limit and other rules of the road is something that you can control. And not only will it save you money on insurance and fines, but making improvements in this area could also save your life.
- Stay on top of your credit history. By joining WalletHub for free, you’ll have access to daily-updated versions of your credit score and report, as well as a personalized credit analysis that advises you on how to improve.