Today we are going to teach you about “Facts You Might Not Know About Car Insurance”
Your Credit Card Can Affect Your Insurance Rate
Your credit score, believe it or not, might have an impact on how much you pay for insurance. Certain credit factors have been discovered to aid in the prediction of losses by insurance companies. Insurers can use that information to set premiums in many (but not all) states.
In general, five factors are used to calculate your credit-based insurance score:-
- Your payment history
- Unpaid debt
- Age of credit history
- New credit applications
- Your mix of credit accounts
This may resemble the credit score used by lenders when you apply for a car loan or a credit card.
Brand Loyalty Can Cost You
If you’re in the habit of “setting it and forgetting it” when it comes to car insurance, you might want to reconsider. Insurance companies utilize a variety of factors to establish rates, and each considers the elements differently, resulting in prices that fluctuate dramatically from one insurer to the next. Instead of letting your policy renew on its own, compare shops once a year to make sure you’re getting the best auto insurance rates.
Stopping Payment? You Might Pay More!
You can change insurance carriers at any moment, but you must do so correctly to ensure continued coverage. You should not simply cease paying your current vehicle insurance policy’s premiums. Call your insurer instead and inquire about their cancellation policies. Some insurers will allow you to terminate your policy over the phone. Others may need you to submit a written request for cancellation. Some companies may even charge a fee if you cancel your reservation. Before terminating your current insurance, be sure you have a new one in place. You risk losing coverage if you don’t. If your coverage expires, your new policy may have higher rates.
Your Car Insurance Company Can Cancel Or Non-Renew At Any Time
Insurance companies, in general, have the right to cancel your coverage for any reason during the first 60 days it is active. There are usually just a few reasons for an insurer to cancel your coverage after that, including:
- Failing to pay your premium
- Having your driver’s license suspended or revoked
- Experiencing a change in your health that makes it unsafe for you to drive
- Lying on your application or when filing a claim
Cancellations can happen at any moment, but non-renewals only happen when your policy is about to expire. Non-renewals can occur for a variety of reasons, including receiving too many speeding tickets, filing too many claims, having your credit score changed, moving to a different location, and more.