Everyone has what is called an insurance score. This score follows you whenever you apply for insurance and it can change. The insurance score has three components: credit, stability and claims history. Think of it as a pie chart divided equally into thirds.
Credit is the first section of that insurance score pie chart. It is a factor that is considered in most auto insurance policies. Like it or not, it is factored in all but 4 states. The credit component has been used since the late 1990s and became mainstream around 2001. Statistics have shown that people who have poor credit scores tend to file the most claims. And people with higher credit scores usually do not file as many claims. When you get an auto insurance quote, the insurance score pulls a soft credit hit and will not impact your credit. The insurance company never sees your actual score. However, many insurance companies will allow you to pull your insurance score again if you feel your regular credit score has significantly improved. Try to keep your regular credit score as high as possible.
Stability is the second section of the insurance score pie chart. What I mean by stability is longevity with your past insurance companies. If you change insurance companies every six months just to save a couple dollars you are doing more damage to yourself and insurance companies are not going to give you their best rate. If you have a history of lapsing and then reinstating policies, you will also get quotes that are not as favorable. Try not to change insurance companies on a regular basis.
Claims and moving violations are the third and final section of the insurance score pie chart. They can spike your rates significantly. If you have several moving violations you really should not complain about rates because that is a huge factor. Claims can also come back and haunt you. If you file small claims that are under $1,000 they are going to add up and could hurt you at renewal or when you shop for quotes. The market has tightened up in the last few years and if you have several recent claims or moving violations some companies will not consider even giving you a quote. Keep your driving record as clean as possible and try to avoid filing small claims.
There are other factors impacting auto rates in Georgia. These include youthful drivers, not having current insurance and carrying low liability limits. For parents with young drivers in the household, it is becoming very brutal on your rates now. Unfortunately, young drivers cause a lot of accidents. They are inexperienced, and today’s youthful drivers have way more distractions than ever before. Parents have told me that their young driver is a good kid and a safe driver, the claims with young drivers just pile up. Today’s young people are also delaying when they get their licenses too. If you have no prior insurance that can disqualify you from receiving a quote from many major carriers. In those situations, you would have to get insurance from a non-standard insurance company for at least six months. If you have the state minimum liability rates of $25,000 per person up to $50,000 each accident, many of the major insurance carriers will not only give you higher rates but some carriers will not even give you a quote if your insurance score is low. When insurance companies raise rates, the higher percentage of the rate increases usually affect those with state minimum liability limits.
Doing anonymous quotes online is a complete waste of your time and the insurance company’s time. As I had previously mentioned every single person has an insurance score that is tied to you. Just making up a fake name using just a zip code and birth year is not going to get you an accurate quote. If you have great credit and use a fake name and address you may end up with a highly inflated quote and you’ll never realize the savings you could have. And on the flipside if your credit is shaky and you give fake information, you may receive a quote which is artificially low, when you go to bind the coverage and then you must give all your real information, you will be shocked and upset when the final quote comes out significantly higher. I know most people do those anonymous online quote requests because they do not want to have agents calling them and blowing up their phones. But if you want a real and accurate quote with no surprises at the end you need to stop doing anonymous quotes.
Hopefully, this can help you understand the basic factors that impact your insurance rates and the quotes you receive. Controlling your insurance score, keeping a clean driving/claims records and having good longevity with an insurance company will help you get the best rates available.
Tracey L. Wells
Farmers Insurance – Wells Agency
678-691-3438
2402 Loganville Hwy, Ste 300 Grayson, GA 30017
twells@farmersagent.com
TraceyWells.net
