In both Save on Car Insurance by Having a Good Credit Score and Why Even Dave Ramsey Needs to Consider His Credit Score I noted the relationship between having a good credit score and saving a boatload on your car insurance. Then in June's issue of Kiplinger magazine I saw it again -- this time with a specific example listed. Here it is:
When Nick Scarafile received his policy-renewal notice last December, his premium had dropped 26% -- and he hadn't changed his cars or his coverage.
Scarafile's insurer, New York Central Mutual, had started to take a much closer look at the driving records and credit histories of its policyholders. Because he has an excellent credit rating, Scarafile ended up with "the most significant decrease" he'd ever seen.
26% savings year after year isn't a bad deal. It's just one reason you need to keep your credit score high.
For more savings tips, see 301 Saving Money Posts -- Hundreds of Ideas on How to Save Money.
When I got married last year, my credit score wasn't in the best shape. 6 months later I reduced a ton of debt and my premiums went down almost 25% also. I love it!
Posted by: Dy | May 26, 2007 at 02:41 PM
I didn't read the article since I don't get Kiplinger, but some things are missing in the scenario, at least the excerpt you've posted here. First, a purely percentage figure doesn't show the real picture, I'd much rather have preferred to see dollar amounts; second, was there other things going on--that is, age, maybe traffic violations or past accidents fell off, etc? note that the excerpt said the auto insurance co. started to look at "driving records and credit histories"...not simply credit histories...more closely. The excerpt lends one to think that it was strictly credit history working, but could be a combination or simply driving record.
it's said but true that insurers correlate credit history in terms of behavior.
Posted by: Tim | May 26, 2007 at 02:48 PM