When you make your regularly scheduled payment, you may be wondering it will help build up your credit similar to a loan or credit card payment.
Your credit score is based on information on your credit report, which includes information about payment history. Unfortunately, paying car insurance premiums does not help you improve your credit score because that history is restricted to credit-related histories, such as credit cards, student loans, car loans, mortgage loans, and lines of credit.
Stated another way, insurance companies don’t report to the credit bureaus, so you won’t gain any advantage to your credit score even if regularly you pay it on time. But, paying your insurance on time does help you avoid late fees and get into a good routine that will send you on your way to building credit.
But, there is one clever hack you can use car insurance to build credit: your car insurance payment can help you build credit by charging it to your credit card and paying it off in full every month.
Moving along, while your insurance showing up on your credit report, you do have to think about what’s on your credit history when you shop for car insurance. There is a link between bad credit scores and higher premium costs. Insurance companies do use your credit score as a factor in determining your car insurance premiums. If you have a lower credit score, you probably won’t be turned down for car insurance but you might be paying higher payments.
Kalfus & Nachman has more than 35 years of legal experience helping the people of Virginia with various personal injury cases. Whether you’ve suffered an auto accident, an injury at work, medical malpractice, a defective product, or harm on someone else’s premises, let us help. Our team of Norfolk personal injury attorneys has the resources and knowledge to provide you with the best possible service. We believe that all of our clients deserve a personal approach, so we will take the time and effort needed to truly understand your needs, concerns, and expectations. Our attorneys will offer you the individual time necessary to build your case successfully. Kalfus & Nachman can also provide you with a free case evaluation to determine who is liable for the injury or damage you’ve sustained and work to develop the details of your case. Let us see what we can do for you. Contact us at (855) 880-8163 or fill out our online form to schedule your free consultation today.