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Posted in Auto Insurance
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Question By
Celebi

1 Contribution
3 People Helped
Why is my auto insurance score lower than my TransUnion credit score?
My TransUnion credit score is good and my auto insurance score is poor. I've never had auto insurance before, is this why? I've only had my credit card open for two months and it's the only I've ever had. I'm worried about my auto insurance score because I will be looking into getting auto insurance soon. I am only a college student and am new to all of this.

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Me too!

Helpful to 21 out of 26 people

If it is of any relief, I too am in the same boat.  All of my credit scores are in the top 5% across the board except my auto insurance.  I have been with USAA for 43 years and have never filed a claim.  I am a male, homeowner, 51 years old with near perfect credit and not so much as a parking ticket on my record.  I am a Colonel in the Army for the last 29 years and do not have anythign derogatory in any records.  I find it almost impossible to believe that 68% of the population is a better risk than I am (on paper and in reality).  I truly believe this is a ridiculous score based on.....????..... well what the heck is it based on?  It cannot be based on income, credit score, drivng record, insurance claims, home owner status, marital status, employment record etc.  Anyone want to venture a guess on how this score is actually determined and what it is based on?

Reply by
joffyjazz

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8 People Helped
Helpful to 8 out of 13 people

I'm 53 with excellent credit but only a fair auto insurance score despite a good driving record and driving over 30 years. I think they penalize single men.

Top Contributor
199 Contributions
216 People Helped

Helpful to 18 out of 24 people

Yes, it's likely that your short credit history is factoring into the low score. For what it's worth, the additional scores KC displays are pretty new in the industry. Actually KC is the first place I've heard of or seen them. I asked my insurance broker about them and he said that they don't use a score to determine insurability. If they use your credit to assess you then they just go off the credit score.

Be prepared to pay higher premiums on your insurance because of your age and lack of driving record. Right now you're a liability because you're classified as an inexperienced driver. Over time, with clean driving (no accidents or moving violations), this classification will change and you'll see your premiums decrease. You'll see a big decrease when you hit 25.

You didn't say whether you're a man or a woman, if you're a man then your rates will be even higher because statistically speaking women are seen as safer drivers.

Make sure you shop around with multiple carriers before choosing a company. Go with a deductible that is managable in a pinch but not so low that you pay for it monthly in the premium. I find a $500 deductible is a good place for me personally. This is what you'd pay if you got into an accident and needed to make a claim. You pay $500 and then the insurance covers the rest. Another thing to look into is renters insurance. For a very small $ you can get insurance on your apartment (or future apartment) AND because you have two policies through the same company you'll get a "multi-line" discount.

Good luck!

Reply by
Celebi

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3 People Helped
Helpful to 3 out of 13 people

This was so helpful, thank you so much! I'm a woman by the way so thankfully my rate won't be as high as a man's.

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5 People Helped
Most Helpful Response

Insurance Companies - Blind Scam

Helpful to 5 out of 5 people

They keep us in the dark and create a scoring system based on nothing any of us can deem tangible and we pay for it... if we like it or not. 

I have NEVER had an accident in over 35 years of driving, NO Claims, NO Home Owner Claims, NO Tickets, Married (Wife has her own policy with the same company), Excellent Credit Score and here's the rub:

I had full coverage Insurance with the lowest deductibles with The Hartford last year and was paying well over $3,000 a year.  I recently switched to Allstate (While according to Credit Karma, my Insurance score plumeted for no apparent reason) and am now paying almost a third of what I was paying with The Hartford and I currently have better coverage and more "stuff" covered. 

It seems to me that this is simply a ruse to make more money for the Insurance Industry.  Period!

Michael

4 Contributions
83 People Helped

Helpful to 8 out of 11 people

I have no clue as to why your credit number is so low.  I don't see an explanation on here anywhereas to what factors generate this score.  If lack of past insurance is the reason for your low score, then I should have a higher credit score... I have an excellent credit rating; a perfect driving record, and a history of owning automobile insurance for over 40 years, including more than 30 years with the same company, yet more than 70% of the population has a higher score than me.  Ironically, the cost of my automobile insurance is quite low, despite my dismal score, so apparently the score isn't taken very seriously by my insurance company.  All my other scores are high, including a perfect score for homeowners' insurance.  So, what could possibly make the automobile industry suspect that I am very likely to file an automobile insurance claim (which is what this score is supposedly used for?)

1 Contribution
4 People Helped

Not just men

Helpful to 4 out of 6 people

I also have excellent credit score and only fair auto and home insurance scores. Clean driving record, insurance for at least 30 years, only one claim - about 10 years ago, backing out of the garage with carb door open (thanks, dd), but nothing else. Maybe it is age and location.

1 Contribution
0 People Helped

Average amount of claims in your area and driving record are definitely factored into your insurance premium but are not a part of your insurance score. Having excellent credit definitely helps but there are many more things factored into your insurance score aside from the number of your credit score. I really don't think the auto and home insurance scores on here are accurate. It's a better conversation to have with your insurance agent or company. 

1 Contribution
0 People Helped

Auto Insurance Nightmare

I am divorced and I was previously listed on Homeowner insurance policy with my spouse.  I was removed from the policy in 2003 and our divorce was finalized in 2004.  The insurance policy that I was previously listed under still had my name in there system data base and falsely listed my name into any Homeowner insurance claims my divorced husband filed.   It took me about 4 years to finally resolve the issue.   In the same month of my Homeowner insurance score dropped at least a 100 points in there attempt to rectify the problem area.   I've been paying sky rocket price on my Homeowner and Auto insurance for the past 4 years for something that I did not contribute to...     You may wish to be sure your not listed on someone elses Homeowner policies even well after your separated or divorced...... It was a Awful nightmare.....   System Bugs and you can't even defend yourself to other insurance carriers when this happen.   You must go back to the inital source to rectify the problem......!!!  :-(

2 Contributions
1 Person Helped

Helpful to 1 out of 2 people

I think its based upon ZIPCODE

Reply by
shirley64

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1 Person Helped
Helpful to 1 out of 1 people

I would agree that it is based on Zip code, however my wife have an excellent driving record, I haven't received any violations or had a claim more than ten yrs. My wife has an very good score and I have a poor score, with a good credit score. It just doesn't make sense, however I do believe it's just marketing and all about money for the most part.

Reply by
gkritt

1 Contribution
1 Person Helped
Helpful to 1 out of 1 people

ZIP code is a factor in determining insurance rates, but the credit score is separate. I worked at an insurance company for a number of years and we received the score from Trans Union (or other agency) and essentially based a factor on the score. That and a number of other factors are used to determine the rates (accidents, violations, marital status, sex, age, etc). 

So - I have an excellent Trans Union credit score, but only a fair insurance score (provided by Trans Union). I don't understand why there is a difference. I can understand the insurance company requiring a different score to be considered "excellent" - which I assume would vary from company to company, but why is there a different score and even a different scale?

2 Contributions
1 Person Helped

Car Insurance Score

Helpful to 1 out of 3 people

I am also very confused as to what factors affect insurance score. I have good credit, zero points against my license (so in effect a perfect driving record) I am 34 year old male with no wrecks ever claimed on insurance, same insurace company for last 5 years, and payment set on autodraft so premiums paid on time the day due for last 5 years. What factors could possibly be giving me a low insurance/high risk for making a claim score????

1 Contribution
0 People Helped

Car Insurance Score

Helpful to 0 out of 1 people

I am in the same boat.  Amica significantly raised my auto and home insurance premiums due to low scores on auto and home insurance - and yet my driving record is perfect and I never have insurance claims and my credit rating is in the top 10%.  I have tried very hard to find out why but have not been able to get any information.  ARRRRGGGG!!

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