You may know many home insurance companies check your credit score before providing coverage. They want to know if you are a financially responsible individual. But, if you want to receive quotes from several companies, could this create a problem on your score? Requesting numerous insurance
quotes will not impact your credit score. Here’s why.
Why Insurers Want Your Information
Home insurance agencies request to see your credit report and score because they want to determine if you are financially responsible. If you have a high score, chances are good you are a responsible manager of your assets. You make payments on time. You take your investments seriously. You make your mortgage payments on time, too. If you have a high score, you are more likely to obtain coverage from the lender.
Will Insurance Credit Score Pulls Hurt You?
When a home insurance agent pulls your credit report, it has no impact on your score. The credit report will acknowledge that the insurer pulled the report. An inquiry will be on your report. However, the insurer is not a lender. As a result, the action they take is not going to impact your credit score. It is an inquiry for basic information. It does not lead to a loan. As a result, the insurer’s actions are not going to move your score in any way. And, even if you receive (or do not receive) coverage, this will not impact your score either.
This means you can obtain multiple quotes. Even if your request quotes from a dozen insurers, it will not impact your score.
What You Can Do to Improve Your Score
If your credit score is not ideal, work to improve it. Doing so may help you qualify for lower home insurance rates.
- Make your payments on time every month. Set up automatic payments to help you do so.
- Avoid spending more than 30 percent of your available credit. Keep balances as low as possible.
- Avoid applying for numerous lines of credit at one time.
- Use a variety of types of credit such as secured loans and credit cards.
- Try to pay off your balances in full each month.
The good news is credit scores do not see an impact from any type of action a home insurance agency creates. You can confidently tell your agent you do not mind them pulling this report.
Also Read: Safeguards Against Burst or Frozen Pipes