The Growella “Credit Scores & Auto Insurance” Methodology
To determine how consumer credit scores affect U.S. auto insurance rates, Growella requested auto insurance quotes for a hypothetical 25-year-old female driver with varying credit scores and gathering more than 22,000 quotes in total.
Auto insurance quotes reflected premiums from the largest U.S. auto insurance companies, such as State Farm, Allstate, and Progressive; as well as from smaller, regional insurers.
We reduced geographical bias by collecting quotes from all 50 states and Washington, D.C.; and, from as many as seven ZIP codes per state comprising urban, suburban, and rural locations.
We broadly applied four credit score tiers to our hypothetical driver. We defined those four tiers — Excellent, Good, Average, and Less-than-Average — as:
- Excellent: Credit score of 720 or higher
- Good: Credit score between 680-720
- Average: Credit score between 620-680
- Less-than-Average: Credit score below 620
We also considered the laws in California, Hawaii, and Massachusetts which precludes insurers from using consumer credit scores to set auto insurance premiums. As expected, insurance quotes showed no variance in these three states.
It should be noted that none of our research was subjective. It’s why this study isn’t titled “The Best Auto Insurance For Millennials” or something similar. The word “best” implies opinion. Our results are unbiased. They’re based on data and original research.
1. About our 25-year-old driver
For our study, we assumed a 25-year-old female driver with no prior speeding tickets, no prior moving violations, and no at-fault accidents; and, with nine years of experience as a licensed driver.
We also assumed that is currently single, with zero children, and has never been married.
She is a college graduate, and her job earns a salary. Her commute to work each day is short; and, she drives an average of 1,000 miles per month.
Our driver parks her car on the street at home, and on the street at work.
2. About our driver’s automobile
Our hypothetical driver owns her car. It’s a 2013 Honda Civic with four doors, a four-cylinder engine, and basic amenities. In other words, it’s among the most commonly driven cars for female drivers in their twenties.
Our driver financed her car using an auto loan, and she insures it using the minimum coverage allowable by law. She does not pay for additional insurance coverage including Gap Insurance and Personal Umbrella Insurance.
Her auto insurance is not bundled with her renter’s insurance, even though bundling insurance can reduce insurance costs by 20% or more. We chose a la carte auto insurance rates because introducing bundling into this study changed the effects of credit scores on auto insurance rates.
3. About our driver’s insurance quotes
Our driver’s insurance quotes were researched and collated by members of Growella’s research team.
Our team solicited insurance quotes from national and regional auto insurers using publicly-available websites; and, phone calls and emails, where appropriate.
We omitted quotes from hyper-local insurers, credit union insurance programs, and other membership-based insurance programs — such as those through Costco and Sam’s Club.
Also, we specifically omitted insurance quote data from Hawaii, Massachusetts, and California in our Credit Score vs. Auto Insurance Rates conclusions. We did this because, in Hawaii, Massachusetts, and California, state law prevents auto insurers from using credit scores to determine a person’s car insurance rates.
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An insurance claim is an official request you make to an insurance company, asking to get paid for damages. Insurance claims can be made for any reason that’s a part of your insurance policy. When you have homeowners insurance, you can make an insurance claim after a fire in your home; after there’s been theft […]