New Rules for Insurance Rates
If you have not heard of insurance scores, you will. In all lines of insurance, companies are starting to use insurance scores to determine what rate an individual will pay There are too many variables that go into making up your insurance score to touch on them all, so we will review a few of the big ones that you can control.
Credit Score: I know it is hard to believe, but your credit score is closely correlated to your chances of having a claim. A good credit score means less chance of a claim. Maybe people with good credit scores just take care of everything they do better than people with poor credit scores. I don’t know. Maybe they just pay the little claims themselves. Credit scores can be used to underwrite all types of insurance, including life and health, and it is a very good indicator.
Loss History: If you turn in many claims, your score goes down (bad). With many companies, if you call in and file a claim that ends up not being payable (below your deductible), they still count it in your score. When you call about a claim, make sure they know you do not want to file a claim until they can explain what would happen or what would be paid if you did file one.
Multiple Policies: The more policies you have in one company the better your score with them will be. Although this is also accounted for in the multi line discount companies offer, it may be used in your score too.
Longevity with Carrier: Companies look at how long you have been with them. Longer is better for your score.
There are many factors and combinations that go into making your insurance score. Watching these four will help you keep your score higher, resulting in lower rates.
