Many factors affect the price that you will pay for car insurance. At Dalessandro Agency Inc., providing auto insurance to residents in the greater Grand Rapids, MI area, we have recently seen an influx of customers asking if their credit score will be checked when shopping for car insurance.
Your Insurance and Credit Score
In Michigan, it is essential to note that the use of credit scores in determining car insurance premiums is restricted by state law. Michigan law prohibits car insurance companies from using credit scores or credit information as the sole basis for determining rates or eligibility for coverage. Under the state’s Insurance Code, insurers in Michigan are required to use other factors such as driving record, vehicle type, annual mileage, and other relevant factors to calculate insurance premiums. The law aims to prevent discriminatory practices and ensure that rates are primarily based on factors directly related to driving risk.
The reason why people ask if their credit score will be checked is because this practice is legal in some states. Some states allow insurance companies to run a credit check and use that information when determining how much an individual will pay for car insurance. As such, if you plan on moving out of Michigan, this may be something that you encounter in the future. However, this is not currently legal in Michigan.
If you are looking for a new car insurance policy, you can rest easy knowing your credit score cannot be used against you. The team here at Dalessandro Agency Inc., serving the greater Grand Rapids, MI area, would love to help you find the right policy for you and within your budget. Call us now to obtain an estimate.