Auto Insurance California

Auto insurance in California and elsewhere started using credit ratings after studies of millions of customers. The studies showed that on average, if you had good credit, you made fewer and less costly claims. This relationship held no matter what your income, gender, marital status or location was.

Companies vary with the importance they give your credit, from making moderate adjustments to your rates to using it as the sole criteria for setting prices. But however it's used, most auto insurance in California uses a credit score to rate your credit. A credit score is a weighted total of the important factors in your credit report. It can include such things as your bill-paying history, your debt level, how long you've had credit and if you've had a bankruptcy or foreclosure.

Having no credit is treated similar to poor credit. So if you have no credit or poor credit you'll need to improve it to get the best rates for auto insurance in California. And when you do improve your credit, notify your insurance company so that they can recalculate your premium.