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Does Getting a Car Insurance Quote Hurt Your Credit?

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This article is sponsored by The General.

car driving on road at sunset
Photo: Pexels

There are a lot of misconceptions about auto insurance quotes and their effects on your credit score. In this article, we will clarify all insurance quotes myths, as well as shed some light on insurance costs.

What is a car insurance quote?

A car insurance quote is an estimate of what you would pay a particular car insurance provider should you sign with them. Other than car insurance, there’s also life insurance and home insurance. Many people apply for numerous quotes to ensure that they get the best deal on car insurance.

For instance, you may apply for car insurance quotes from auto insurance companies X and Y. Based on the information you provide them, company X could provide you with a car insurance premiums for $100 monthly, while company Y might provide you with the same insurance coverage for $ 150 every month. Shopping around can help you get the best deal and save more money.

Can car insurance quotes hurt your credit?

When you apply for an insurance plan, you may need to have a credit check. That might be a scary prospect since you’ve probably heard that having your credit checked has a negative effect on your credit score.

What auto insurance companies actually do is perform a “soft pull” search inquiry on credit score. They look into your past credit record to ascertain payment compliance and find a quote that suits you.

Although the inquiry has zero effect on your score to lenders, it is still visible on your personal credit reports.

Why do they need to perform a credit score search?

There are a lot of reasons for the search and one of them is to enable them to determine the risks of insuring you. Apart from risk calculation, the search also determines the right premium based on costs.

Recent studies by insurance experts have indicated that people with lower credit scores have more costly insurance claims than those with high credit scores.

Besides, car owners with low credit scores are more likely to file insurance claims more often. Therefore, automotive owners are advised to maintain a high credit score by maintaining positive finance habits.

Improve your credit score to get the best insurance premiums

Studies on auto insurance have shown that growing your credit score by just one tier can save you about 17 percent on auto insurance. Motorists with poor credit scores may pay double what motorists with excellent credit scores pay, depending on the state they reside in.

That’s because motorists with lower credit scores tend to file insurance claims more often, and normally cost car insurance providers more money. In simple terms, having a high credit score can help reduce your insurance premiums since the insurance provider knows that you are not a threat.

So when seeking out a new auto insurance quote, make sure you check your credit report and find ways you can build better credit score-it could save you a lot.


While insurance quotes don’t really affect your credit score, your credit score may affect your quotes. It can also prove to insurance providers that you can pay your monthly payments on time. An excellent credit score may lead to more affordable insurance options, while a low credit score may make you pay more. That’s why it is essential to know your insurance credit score.