You’ll Pay Less To Park Your Car When Your Credit Score Goes Up

November 06, 2020 by Dan Green

So, how much does your credit score affect your auto insurance rate? In short, by a lot.

Growella gathered tens of thousands of auto insurance quotes as part of this study and found that having a low credit score can raise your car insurance costs more than a driver with high credit scores after an at-fault, 2-car accident would experience.

Let that sink in.

Even with no claims, no accidents, and no moving violations, drivers with low credit scores pay more for auto insurance than drivers with excellent credit, but a recent car crash.

It’s another way that having good credit helps you save money.

As compared to drivers with excellent credit, here’s what drivers with less-than-excellent credit scores pay for their car insurance:

  • Drivers with “excellent” credit get the best rates available
  • Drivers with “good” credit pay 21% more for car insurance
  • Drivers with “average” credit pay 39% more for car insurance
  • Drivers with “less-than-average” credit pay 117% more for car insurance

In other words, drivers with less-than-average credit pay more than twice what drivers with excellent credit pay; and, low credit scores cost more than having a DUI.

It pays to improve your credit score. It also pays to shop for new insurance when your score has increased — even by a little.

Remember: most auto insurance policies last for six months, then renew automatically. Insurance companies rarely re-review your credit to see if you deserve a lower rate.

If your credit score has possibly climbed, you should shop for new auto insurance. Even a modest improvement in your credit score can lead to massive savings in your budget.

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