Which insurance companies don't use a credit score when deciding insurance rates?

You should know that the insurance company could raise your premiums, move your account to a subsidiary company, and even cancel your insurance altogether. The majority of insurance companies consider your credit score along with your driving record to determine risk. Some companies use credit scores to deny renewal coverage even if you never filed a claim and even if you have paid all your premiums on time.

If you do not want to be denied coverage, find a company that sells no credit check auto insurance. Why Auto Insurance Companies Check CreditThe assumption is that there is a relationship between financial stability and risk. The insurance industry keeps statistics on credit ratings and insurance claims and, based on these statistics, they have found in general that the lower the insurance credit score, the more likely you are to file claims, exaggerate the claims you file, and perhaps even commit insurance fraud.

This does not mean that you personally would do these things, but that you happen to fall into an unfavorable category because of your relatively low credit score. According to the Insurance Information Institute, "Insurance scores don’t predict the actual experience of one individual. They predict the average claim behavior of a group of people with essentially the same credit history."

A good score is typically above 700 and a poor score is below 600. While on average people who have poor credit scores tend to file more claims, there are always exceptions. Within that group, there may be individuals who have stellar driving records and have never filed a claim.

Finding No Credit Check Car InsuranceYou should be able to find a company that sells no credit check auto insurance, even though many insurance companies want to know your risk level before they sell or renew your auto insurance policy. They want objective and accurate information when they issue policies. They also want to be able to predict claims, manage risk and offer more coverage to more consumers at a fairer cost.

However, some insurance companies will offer no credit check auto insurance anyway. If you are concerned about how your credit rating will affect your coverage, you probably should find one of those companies. You can use our service to get no credit check car insurance quotes.

Your state insurance department may also be able to provide the information you need. Checking Your Credit ReportIf the insurance company refuses to cover you because of your credit history, the Fair Credit Reporting Act allows you to obtain a free copy of your credit report. According to the Federal Trade Commission (FTC), "your credit report contains information about where you live, how you pay your bills, whether you have ever been sued, arrested or filed for bankruptcy.

Consumer reporting companies sell the information in your report to creditors, insurers, employers, and other businesses that use it to evaluate your applications for credit, insurance, employment, or renting a home. The federal Fair Credit Reporting Act (FCRA) promotes the accuracy and privacy of information in the files of the nation’s consumer reporting companies." Handling Errors and Identity TheftYou may have been unemployed for a few months and fallen behind on some of your bills.

Even worse, you may have been the victim of identity theft and someone else is responsible for your adverse credit report. The FTC is a good resource for information on protecting yourself from identity theft. However, if you find yourself in this unfortunate situation, you should obtain your credit report and check it over for accuracy.

You may find that some of the information on your credit report is wrong. If you find errors on your credit report, there are ways to get them corrected, however it may not be so quick and easy to remove the unfavorable information. For helpful information from the Federal Trade Commission on how to dispute credit report errors, click here.

You might want to look for no credit check auto insurance because correcting erroneous information on your credit report can sometimes be difficult and time-consuming. It might be less of a hassle to go ahead and get the no credit check car insurance than it would be to repair your credit right now. However, for a variety of reasons, it would be in your interest to deal with the credit reporting agencies sooner rather than later.

Additional Information on No Credit Check Auto InsuranceThe Insurance Information Institute recently published a study discussing details of why carriers associate credit score with auto insurance risk.