What Is an Insurance Score? - NYCM Insurance Blog

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Dec 6, 2023

What Is an Insurance Score?


Learn More About Insurance Scores, How They Affect Your Premiums, and How to Raise Your Score.


While most people are aware of what a credit score is and have a general idea of how it is calculated, fewer people understand what an insurance score is and how it impacts their premiums.


What Is an Insurance Score?


An insurance score - or insurance credit score - is a three-digit number assigned to you to predict the risk of an accident or insurance claim in the future. Scores above 770 are considered good, between 500 and 770 average, and below 500 poor. Different insurance carriers may have different models for assigning your insurance score, which directly affects the premium you pay. If you have a lower insurance score, you would likely pay a higher premium in the same way that if you have a lower credit score, you would pay a higher interest rate, and vice versa.


How Is an Insurance Score Calculated?


Different insurers have different ways of measuring your insurance score, but insurers generally utilize details from your credit history as well as risk and insurance claim data to measure your score. For auto insurance, someone with a clean driving record may be more likely to obtain a higher insurance score than someone with a history of traffic infractions or accidents, but for homeowners insurance, your driving history won’t necessarily have any effect. Your credit information plays a role in determining your insurance score: if you have a history of making your payments on time and have little outstanding debt, your insurance score will reflect that. Your insurance score can also vary as you age or move locations.


How Can I Raise My Insurance Score?


While it is possible to raise your insurance score, doing so can take some time. If your insurance score is low, it could mean you have some missed or late payments affecting your credit score. Ensuring you pay your bills on time is a good step towards raising your credit score and consequently, your insurance score.


A clean driving record is also an important factor in raising your insurance score and lowering your premium for auto insurance. If you have a history of traffic infractions, setting a new trend, free of traffic tickets and accidents, will benefit your score over time. Consider taking a defensive driving course to sharpen your skills.


While some auto claims are unavoidable, it is possible to put yourself in a position where they are less likely to occur.


       Perform Regular Maintenance Check-ups on Your Vehicle: Keep an eye on the parts of your vehicle most susceptible to wear and tear. Make sure your tire tread isn’t worn, especially in the winter when driving conditions can be more challenging. Beyond inspecting the tread, rotating your tires every 5,000 miles can help guarantee even wear across your tires. It’s also a good idea to regularly check that your brakes are functioning as intended. Having proper brakes can be the difference between an automobile accident or a close call. As a rule of thumb, having your automobile serviced by a certified mechanic at least once a year can be a good step toward s making sure your vehicle is operating at its best.

       Shelter Your Vehicle: If possible, shelter your vehicle in a garage or carport to minimize the likelihood of damage.  While falling tree limbs and hailstorms can pose a threat to the body of your vehicle, it’s also more likely that you will avoid vandalism and theft if you are able to enclose your vehicle in a garage. If you are unable to cover your vehicle, consider parking away from trees and always make sure your vehicle is locked. It can be hard to predict the extent of damage a storm may bring, but keeping your vehicle sheltered can give you some added peace of mind.

       Travel Roads You Are Familiar With: By sticking to driving the routes you are familiar with, you are less likely to encounter any dangerous surprises that might turn up along the way, like unexpected sharp turns, areas prone to flooding, or other hazards. While it’s impossible to completely negate the inherent risks of driving, sticking to the roads you know will give you the best chance at arriving to point A from point B without incident.


After learning about what an insurance score is, you may now be interested in finding out what your premium might be based on it! Click the button below to contact an NYCM Insurance agent near you today!