Saturday, April 28, 2007

The REAL SECRET to lowering your insurance premium

WHEN YOU BUY INSURANCE: Most insurance companies run an insurance credit score when you apply for an auto or home quote.

INSURANCE CREDIT SCORING: Third party statistics have demonstrated that the better a person's credit, the fewer claims they have. Insurance companies have a vested interest in being accurate when it comes to claim predictions.

The better an insurance company is about predicting claims, the more money they make and the lower premium (usually) you pay if you qualify for their best rate. While we all know insurance companies usually make alot of money, as consumers we want them to be accurate in their predictions. It helps keeps premiums solidified and stable.

A GOOD QUESTION: Does better credit really make someone a better and safer driver? I am not sure anyone can explain exactly why good credit/fewer auto claims go hand in hand, but the statistics seem to bear that out. Insurance companies have studied literally thousands of prior claims to reach this conclusion. And if there is one thing insurance companies usually know - it is statistics.

THE BEST ADVICE: Work hard to improve your credit score, if it is average or poor. Only keep one or two credit card accounts. Having too much open credit is usually not good when it comes to these scoring models. Do not max out credit card limits, either. Carry few credit card accounts and do not charge up to your credit limit. Keep a comfortable gap between your available limit and the amount charged. And pay your bills on time. Do these things over a 12 month period and see if you can find a better insurance rate.

Visit our website at Scottsdale Insurance OR call (480) 659-0229

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