While it is true that most car insurance companies use credit scores to evaluate risk when deciding whether or not to insure someone, the good news is that it is still possible to find a company that will help you save money or possibly even offer no credit check car insurance. There are also other options to explore when it comes to this sort of thing, so relax. First and foremost, an important thing to know is that the easiest way to get no credit check car insurance is to find and provide facts demonstrating that you are actually a low risk driver and that your credit score is actually a poor indicator of you. One of the best ways to do this is to gather all of your information in one place and have it ready when you start shopping for car insurance.
1.) A Bit of Background Information
If you are young and/or just starting out and have never had car insurance before — and your credit is poor or not really established yet — your best bet may be to have your parents add you to their policy or a policy of your own with their names attached to it as a reference. When I first started out driving, my dad took me to the insurance company and they added my name to one of his policies and as a result a lot of discounts were put on my account. By the end of it all, I was literally paying $57 a month for car insurance. It should also be noted that I owned my car, it was a used 95′ Chevrolet Monte Carlo, and I was living in a small town with less traffic and risk of accidents, so these were all factors that helped my case. I also did not have full coverage, only PLPD.
Deciding to forgo full coverage has helped a lot of people I know get cheaper rates, but there are always lots of pros and cons to weigh. For instance, my car being as old as it was it didn’t really matter if I didn’t have full coverage, but now that I own a 2004 Chevy Aveo that I have a loan on I am required to have full coverage, so as always think these things through and see what you can afford to go without. Another option is to pay a higher deductible. Sure it is going to suck if you crash your car and need to suddenly come up with a lot of money for a repair, but it will also save you from paying more on your car insurance bill each month in the meantime.
If you are having trouble obtaining car insurance due to poor credit or a poor driving record other things you may want to consider are getting a different car (older and used are usually better bets in this case) or maybe even moving to an area with less traffic. If you have been previously insured the good news is that your previous insurance records can usually help your case as it can provide accurate information to prove that you are a low risk driver or have good payment history. In order to prove this to a new car insurance company it is always a good idea to have copies of the relevant policy schedules in hand and to also gather any documents regarding your driving and insurance history in terms of accidents, violations, and/or claims that you have made.
If you have had any type of extenuating circumstances that kept you from being able to pay your bills on time in the past, sometimes explaining this in person can also help your case. Most insurers will understand that there is more to a consumer than bad credit. Perhaps you experienced an illness or a death in the family, maybe you were unemployed because you lost your job and were unable to make payments, it never hurts to try and state your case.
2.) Other Ways to Prove That You Are Low Risk
Your credit score is only one factor that car insurance companies will use to determine what type of risk you may pose to them. Try to find other ways to show them that you are a low risk driver. This could include showing them your spotless driving record (Which I had for a few years when I was just starting out), Keeping up with monthly car payments or other types of payments such as mortgages, rent, student loans, previous car insurance payments, etc.
I made poor decisions and racked up a lot of credit card debt and got behind in credit card payments, this I’m sure negatively affected my credit score. However, by being able to prove to the car insurance company that I could always pay my car insurance on time, always paid my rent on time, and was getting all A’s in school helped show them that I am a responsible person who always pays my other bills on time. In the meantime I was able to start working on building my credit back up by never missing a credit card payment again, making payment plans with any creditors I owed and bringing any delinquent accounts current.
3.) Shop Around and Be on the Lookout for Discounts
Never settle for the first car insurance company you come across. Shopping around is your best bet for finding the best price on car insurance. Filling out quotes online is a good way to shop around and see whats out there. Sometimes if you are already with a car insurance company and they try to raise your premium you can even haggle with them as they would rather charge you less in most cases than see you leave and switch to a different insurance company. I did this with my insurance company for the first 5 or 6 years that I was a licensed driver until finally switching companies after my premium sky rocketed when being involved in an accident.
I also tried to take advantage of any discounts I knew I qualified for. Having an anti-theft device was a discount in itself, along with other features my car had. Being on the dean’s list all throughout college really helped me save some big bucks with my insurance company’s “Good Student Discount” and required very little effort on my part as I’ve always been a good student. All it required was me having to send in a copy of my transcript every few semesters to prove that I was still in good academic standing. I also qualified for multiple discounts since my parents had home insurance and car insurance policies with the company and were long term customers with good credit and good payment history.
Another way consumers can sometimes save is by having a multiple car policy or by adding on a renter’s or home insurance policy. For just $20 a month my apartment is insured up to $40,000 in damage and theft and as a result my monthly car insurance bill is actually just a little bit cheaper than it would be otherwise. These are all valid things to consider.