Did you know that your credit score (the numerical ranking that is a summary of the info in your credit report) has a direct effect on your insurance score? And depending on what your insurance score is, that particular number will play a very big part in how much you will be charged for insurance coverage over time.
An insurance score is not the same thing as a credit score. It is a numerical point system used by insurance companies to predict risk. Your insurance score is essentially a rating that is computed and utilized by insurers. This number represents the likelihood of you filing an insurance claim during the time that you have coverage with that particular insurer. Part of the way your insurance score is determined is by your past insurance claim filing history.
There are two main providers of insurance scores. These include the Fair Isaac Corporation and ChoicePoint. The scores that are provided by Fair Isaac range between 300 and 900, with a good score being considered those that are above 700. ChoicePoint’s scores range between 900 and 997, with better scores being those that are in the higher numbers. The type of insurance policies that can be affected by your insurance credit score include home, auto, boat, motorcycle and RV.