Did you know a bad credit score can affect your insurance rate, increasing your premium payment and making it more expensive? But the truth is, even if you have a good credit score, the lack of payment history, long enough credit, debt balance or existing recurring payments can work against you also when applying for insurance.
Why do insurance companies care about your credit score? Why does your credit score matter when applying for life insurance, auto or car insurance, or any type of insurance?
The answer is, there's enough evidence and data that shows correlation between credit score, consumer behavior with the risk associated to you as an insured.
Most insurance companies like Nationwide, Allstate, Statefarm, Progressive and others use credit based insurance scores to calculate your premiums.
Credit score companies like Experian, Transunion and Equifax developed different measures and metrics companies can use to analyze an individuals level of risk based on credit.
We discuss all this and more in this video.