Consumers with good credit can expect to pay an average of $200 less for their auto insurance premium each year, reported ComparisonMarket today.
The company released the results of a study that showed a correlation between auto insurance premiums and credit score, indicating that consumers with higher credit scores paid less for their auto insurance each year.
For the study, ComparisonMarket looked at quotes and sales on its comparative auto insurance quoting platform, including Insurance.com, over an 18 month period. The data clearly showed that consumers with credit scores above 650 saved an average of $200 for their auto insurance premium compared to consumers with credit scores lower than 650.
The study reflects the pricing activity of carriers that participate in the ComparisonMarket marketplace, the states where Insurance.com quotes and the aggregate profile of consumers who shop with Insurance.com.
"Many auto insurance companies use your credit score as a factor in calculating premiums," advised Dave Roush, CEO of ComparisonMarket. "They have good reasons for doing so, as in their experience, higher credit usually equates to a better insurance risk."
As this study shows, managing your personal credit is critical, as it is an important factor in determining your auto insurance rates. Variables such as vehicle type, geographical location, driving history, occupation and other factors also play an important role in auto insurance pricing.
"Insurance companies use these factors to determine the price for your auto insurance in different ways," noted Roush, "To make sure you're getting the best coverage at the best price, you have to compare rates before you buy, and find the company that's best for you. Comparing rates saves our customers an average of over $400 on their auto insurance premiums each year. That's significant savings."
The Fair Credit Reporting Act (FCRA) requires the three reporting companies - Equifax, Experian, and TransUnion - to provide consumers with a free copy of their credit report once a year. Consumers who wish to monitor their credit rating on a more regular basis may pay to access the credit reports at any time.
ComparisonMarket, Inc., based in Solon, Ohio, owns and operates Insurance.com. The Insurance.com website enables consumers to instantly compare and buy competitive auto insurance quotes directly from any of more than a dozen leading insurance companies.
When ready to purchase, users have the option of completing the transaction online or talking directly to an unbiased licensed agent. Other products include life, health and home insurance as well as travel, dental and pet health insurance.
In addition to Insurance.com, ComparisonMarket provides private labeled solutions to financial institutions, affinity groups and online marketplaces to offer their customers real choice and savings opportunities on auto insurance.
Dave Roush, CEO
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