Car insurance is a necessary expense when it comes to owning and driving a car. At Accurate Insurance, we always work to get you the lowest possible rates available—guaranteed. But did you know there’s a lot you can do to proactively lower the rates you qualify for? Whether you’re a new driver or have been driving for years, we have some tips to help you improve your position in the eyes of insurers.
Improve Your Credit Score for Better Insurance Rates
When trying to acquire auto insurance in Indianapolis or any other state, one of the main factors that will be considered is your credit score. The credit system is complex and, at times, opaque, but nonetheless, it can make a significant difference in the rates you’re offered for car insurance, different types of loans, credit cards, and more. If your credit has been badly damaged in the past or you are just beginning to build credit, it may take some time to attain a high score. Here are a few things to help you improve your score:
Five Tips to Improve Your Credit Score
Pay on time
Your payment history is the single biggest factor in determining your credit score, so if at all possible, prioritize paying bills on time. Late payments remain on your credit report for seven years and thus can be more difficult to overcome than other dings to your score.
Use less than 30% of your available credit
The second-largest factor impacting your credit score is your credit utilization or the percentage of your credit being used at any given time. Using 30% or less of your available credit can help improve your score. For some individuals, applying for additional credit with the intention of not using it can make improving your score easier.
Get a secured credit card
If you’re having trouble applying for new credit, a secured credit card may be a good option to help you improve your score. A secured credit card requires a deposit upfront, often of $200 or more, which shields the issuer from risk. Making purchases with the card and paying them on time can help positively impact your score.
Apply for a credit-builder (or secured) loan
Designed to establish or boost credit, you can get a credit-builder loan from select banks and credit unions. These loans involve a certain amount of money being set aside in an account, which you will gradually pay off in order to retrieve the fund. Payments towards this loan are reported to all three credit bureaus.
Ask to become an authorized user
If you have a trusted friend or relative who is willing to help you, you can ask them to make you an authorized user on their credit card. Being an authorized user will allow you to benefit from the responsible usage of another’s card. This is a privilege that some parents offer their children in order to begin building credit from a young age.
Buy a Car That’s Cheaper to Insure
Your car insurance company will take into account the make and model of the car you’ll be driving when determining your rates for auto insurance in Indianapolis or any other state. Some cars, such as those with greater safety or anti-theft features, will be less expensive to insure than others. When working with a budget, not everyone has endless options when it comes to buying a new (or new-to-you) car. However, if you do have some flexibility to pick your ride, you may want to consider your potential insurance rate as a factor.
Make and Model Considerations
Overall car value
The greater the overall value of your car, the more costly it will be to insure. When you invest in a higher-end, luxury, or classic car, the up-front cost is only part of the amount you’ll need to devote to the vehicle. Be sure you are also willing to cover the larger monthly payments that will come with the car before purchasing.
If a make and model is known to have greater repair costs, insurers will certainly factor this into the monthly total you are offered. Be aware that this does not only apply to luxury vehicles—it’s important to research the repair costs associated with any vehicle you are considering buying, including used and new mid-level cars.
Potential of theft
Some cars are more vulnerable to thieves than others. Common vehicles with universal parts may be more at risk due to the ease of resale, which is a factor that insurers take into consideration when determining your rate. Cars with anti-theft features tend to be less costly to insure.
Road safety rating
In addition to the clear health benefits that come with safety features, cars with better road safety ratings tend to be cheaper to insure. When shopping to buy your next car, you may want to focus on vehicles with anti-lock brakes, airbags, daytime running lights, electronic stability control, and/or automatic seat belts.
Looking for Affordable Auto Insurance in Indianapolis?
At Accurate Auto Insurance, we work with individuals regardless of credit score, vehicle, or driving record. We pride ourselves on being able to connect people with affordable auto insurance rates that enable safe and compliant driving. It’s easy to apply online or contact us to speak with a friendly and helpful member of staff. Get started today!