What Is No Credit Check Auto Insurance? (2024)

FAQs

Does having no credit affect car insurance? ›

If you live in California, Hawaii or Massachusetts, your credit score won't be taken into account because state law prohibits it. Outside of these states, credit is a common pricing factor because of its apparent accuracy in helping auto insurers predict risk.

Most insurers use credit checks to create a credit-based insurance score to help set your rate. Some insurers provide auto insurance with no credit check, which might seem appealing if you have a poor credit history.

GEICO may charge a higher rate, for instance, if it finds information in your driving record that wasn't disclosed in the application. The insurer may also run a soft inquiry on your credit report to develop a credit-based insurance score, which could also impact your rate.

How credit-based insurance scores work. Most U.S. insurance companies use credit-based insurance scores along with your driving history, claims history and many other factors to establish eligibility for payment plans and to help determine insurance rates. (Again, except in California, Hawaii and Massachusetts).

Does Progressive check credit history when my policy renews? In states where it is allowed or required by law, we periodically review policies, including credit history.

According to our rate estimates, the best companies with cheap auto insurance for those with lower credit scores include USAA, Geico, Nationwide and Progressive.

Yes, Liberty Mutual does use your credit score as a factor when determining your car insurance rates, as do most major insurers. However, credit checks by auto insurers do not harm your credit score and are only done in states where it is legal for your credit score to affect your rates.

Does State Farm use credit scores? ›

Key Things to Know About How State Farm Uses Your Credit Score. State Farm will assign you an auto insurance score, which is based on your credit history, just like your credit score. This auto insurance score could vary from one insurer to another since insurers may take different things into account.

Geico is cheap because it offers a wide range of discounts that apply to a variety of situations. Geico also covers millions of drivers across the country, so it spreads out financial risk, which helps it offer cheap car insurance quotes.

Based on our research, Geico, Nationwide, Mercury, Amica and Travelers are some of the cheapest providers for drivers with bad credit.

Most auto insurance companies will check your credit-based insurance score as part of the underwriting process, if you live in a state that allows it. But some will provide auto insurance without a credit check because they base your car insurance premiums on other factors.

Yes, in most cases car insurance companies will pull your credit when you get a quote. But most companies will use a “soft inquiry” as you go through the quote process, which means that it won't impact your credit score—like a hard inquiry.

Does credit score affect car insurance rates? Yes. A higher or lower credit score can have a big impact on your insurance rate. Poor credit increases full coverage rates by 86% compared to good credit.

Progressive does not use information about credit history solely to refuse to insure a customer or to cancel a policy. In fact, our use of insurance scores has allowed us to offer lower rates to more customers.

Typically, the higher your credit rating, the less you will pay for home insurance in the states where credit is considered a rating factor. Although it is only one factor in setting rates for home insurance, data shows that the credit-based insurance score is an important one.