How Credit Scores Affect Auto Insurance Rates (2026)

When you think about all of the factors that go into your auto insurance, you usually think about various aspects of the car itself, or perhaps of your type of coverage.

Does credit score affect car insurance? You might not know it, but depending on where you live, your credit score might even be one of the things your insurance company uses to determine your rates. Keep reading to learn how credit scores affect auto insurance rates in your area.

You can find and compare auto insurance quotes from many different insurance companies. Enter your ZIP code above right now.

States That Use Your Credit Score

Today, there are 46 states in which auto insurance companies can look at your credit score and consider it a factor in your premiums. California, Massachusetts, Hawaii, and Maryland forbid this practice, but it’s open everywhere else.

Why is insurance affected by credit score? The auto insurance companies believe that a person who has a lower credit score is less of a risk to the insurance company.

What credit score do insurance companies use? The insurance companies use a form of the credit score (known as the “insurance score”) which takes into accounts things like late payments, type of credit, credit card utilization and collections.

Some states are still struggling with this issue. For example, in Michigan, the Attorney General addressed auto insurance laws and banned the practice of considering credit in determining insurance premium rates.

The Michigan Supreme Court suggested that these scores were part of a reasonable way of classifying risk.

Read more:

• What’s an auto insurance score?
• Why is my auto insurance score going down?

Auto Insurance Rates by Credit Score

Will insurance companies offer you lower rates if you have a good credit score? Yes, and the table below proves there’s quite a difference in your premium based on your credit score.

Auto Insurance Monthly Rates by Credit Score

When it comes to having poor credit, you would pay an average of $103 more a month than if you had good credit.

The most affordable difference is with Nationwide at $46 more a month, while the least affordable difference is with Liberty Mutual at $178 more a month.

Read more: Best Auto Insurance Companies for Drivers With Bad Credit

Other Factors to Take Into Consideration

Your credit score isn’t the only factor in your auto insurance premium rates. Your age, type of vehicle, and where you live all play a part when calculating our monthly premium.

The insurance companies each have their own formulas for how each factor is weighted. Are there insurance companies that do not use credit scores? Even in states where it’s legal for the company to consider your credit score, not all of them do. But, since the majority of providers do factor in your credit score, you need to do a company-by-company check of those who don’t.

If you’re concerned that your credit score is negatively impacting your auto insurance rates, you have a few options.

You can improve your credit score by paying your bills on time and utilizing the credit you already have appropriately. You can also consider switching to an insurance company that doesn’t use the score as a factor.

You can also balance out that higher cost with other choices such as getting auto insurance discounts for driving a vehicle with advanced safety features and completing a defensive driving class.

How Credit Scores Affect Auto Insurance Rates: The Bottom Line

When it comes to your auto insurance, your credit score can be a major factor in determining your costs.

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