Your credit score is one of the most important factors that affect your ability to get affordable insurance. In fact, many insurance providers use your credit score to help determine your premium rates for auto , home , and even life insurance policies. Understanding this connection can help you save money and make better decisions about your coverage.

At Riseson Insurance , serving Tempe , Phoenix , Scottsdale , Tucson , Gilbert , and Chandler , we want to help you navigate the relationship between your credit score and your insurance. Here’s what you need to know to get the best rates possible.

Many insurance companies use a credit-based insurance score to assess the risk of insuring you. This score is similar to your regular credit score but is specifically used by insurers to predict the likelihood of you filing a claim. A higher credit score generally means lower premiums, while a lower score can lead to higher rates.

This practice, known as credit scoring, is common in most states, including Arizona. The reasoning behind this is simple: statistically, people with higher credit scores tend to file fewer claims and are seen as less risky to insure.

A credit-based insurance score is a modified version of your regular credit score. It takes into account:

Payment history (whether you've made payments on time) Amount of debt (how much you owe) Length of credit history (how long you've had credit) Types of credit used (credit cards, loans, etc.) New credit (recently opened accounts)

Although it’s based on your credit score, this number doesn’t just reflect your financial responsibility—it also indicates how much risk the insurer believes you pose as a policyholder.

Yes, a poor credit score can lead to higher insurance premiums. Insurance companies use credit scores to predict risk, so a lower score may mean higher rates, as the insurer sees you as a higher risk. For example:

Home Insurance: If your credit score is low, your insurer may charge higher premiums to offset potential losses. Auto Insurance: A low credit score may indicate that you’re more likely to file a claim, which can result in higher rates. Life Insurance: Some insurers also use credit information to determine eligibility and pricing.

If you’re finding that your credit score is affecting your insurance premiums, there are steps you can take to improve it:

Pay Your Bills on Time: Late payments can significantly lower your credit score, so making payments on time is essential. Reduce Your Debt: Paying down high-interest credit card balances and other loans will improve your debt-to-income ratio. Check Your Credit Report: Regularly review your credit report to ensure there are no errors or fraudulent activities impacting your score. Avoid Opening New Credit Accounts: Opening multiple new credit accounts in a short period can hurt your credit score. Consider Credit Counseling: If you're struggling with debt, credit counseling can help you create a plan to improve your financial situation.

Yes, in Arizona, it’s legal for insurance companies to use your credit-based insurance score when determining your premiums. However, there are restrictions. Insurers cannot solely base your rates on your credit score and must also consider other factors, such as your driving record or claims history.

Yes, you can still get insurance with a low credit score, but your premiums may be higher than someone with better credit. The good news is that there are steps you can take to improve your credit over time, and Riseson Insurance is here to help you shop around for the best rates possible, regardless of your credit score.

We work with many reputable insurers who offer options for people with a range of credit scores. Our team can help you find the coverage you need at a price you can afford.

If you're in Tempe, Phoenix, Scottsdale, Tucson, Gilbert, or Chandler and want to explore how your credit score impacts your insurance, give us a call. At Riseson Insurance, we’ll review your policy, explain the factors that affect your rates, and help you find a plan that works for you.

Call us at 602-460-5470 for a free consultation and to get a customized quote.

How Does Your Credit Score Affect Your Insurance?

What Is a Credit-Based Insurance Score?

Can a Poor Credit Score Increase Your Insurance Premium?

How Can You Improve Your Credit Score for Better Insurance Rates?

Is It Legal for Insurers to Use My Credit Score?

Can I Still Get Insurance with a Low Credit Score?

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• Payment history (whether you've made payments on time)
• Amount of debt (how much you owe)
• Length of credit history (how long you've had credit)
• Types of credit used (credit cards, loans, etc.)
• New credit (recently opened accounts)

• Home Insurance: If your credit score is low, your insurer may charge higher premiums to offset potential losses.
• Auto Insurance: A low credit score may indicate that you’re more likely to file a claim, which can result in higher rates.
• Life Insurance: Some insurers also use credit information to determine eligibility and pricing.

1. Pay Your Bills on Time: Late payments can significantly lower your credit score, so making payments on time is essential.
2. Reduce Your Debt: Paying down high-interest credit card balances and other loans will improve your debt-to-income ratio.
3. Check Your Credit Report: Regularly review your credit report to ensure there are no errors or fraudulent activities impacting your score.
4. Avoid Opening New Credit Accounts: Opening multiple new credit accounts in a short period can hurt your credit score.
5. Consider Credit Counseling: If you're struggling with debt, credit counseling can help you create a plan to improve your financial situation.