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Have ever play a “tamiya” racing game? When you release your mini - 4Wd into the racetrack, there’s no turning back. What I’, trying to say is that, you are responsible for the consequences of your actions. Your credit history also affects your car insurance rates. Many personal car insurance companies consider your credit information when determining how much premium to charge for your insurance. Some insurance companies are credit information because they believe that the consumer’s history behavior is directly related to the expected claims that may occur. They feel that people with better credit behavior are less likely to severe insurance losses. Many insurance companies use age, driving history, type of vehicles and your residency in determining the cost of your insurance. But the companies that use credit history may not be best for you if you have not established a credit history yet. It could only result in higher premiums because they may not allow you to be eligible for certain discounts. Maybe you would ask if it’s fair for an insurance company to look at your credit information without your permission. The answer is yes. The Federal Fair credit – reporting act says, “Reasonable procedures, it is the purpose of this title to require that consumer reporting agencies adopt reasonable procedure fro meeting the needs of commerce for consumer credit, personnel insurance and other information in a manner which is fair and equitable to the consumer, with regard to the confidentiality, accuracy, relevance, and proper utilization of such information in accordance with the requirements of this title.” This can be found at http://www.ftc.gov/os/stutes/fcrs.htm. If your are confident that your credit history is better than what the insurer can find, see to it that the insurer has your correct name, address, social security number, and date of birth. Though some insurance companies look directly at your actual credit reports in determining your rate, most companies use an “insurance credit score.” An insurance credit score is developed by using statistical techniques and methods to predict the likelihood a consumer will have a higher than anticipated losses. Credit history Factors and car Insurance Rates Insurance Companies use many factors in determining your credit history. One example is the public record which include bankruptcy, collections, foreclosures, liens, charge-off and the like. Another one is the payment history or the number and frequency of late payments and the days between the due date and late payments date. Next, the length of credit history or the time you have been in the credit system; the inquiries for credit or the number of times you have recently applied for new credit including mortgage loans, utility accounts and credit card accounts, the number of open lines of credit or the number of credits cards, whether you use them or not; type of credit in use which include major credit cards, store credit cards, finance company loans, etc; and unused credit or how much you owe compared to how much credit is available to you. Your insurance credit score may differ from company to company, as they use different factors in determining your premium. It is called insurance credit score because it encompasses many factors including credit. Your agent or company is not obliged to tell you your credit score. In fact, they might not even know what it is. Usually, what they only know is that you credit score qualifies you for a specific rate or policy. Tell the credit bureau immediately if you feel that there is incorrect information on your credit report. The credit bureau must investigate the error and get back to you within 30 days. You can ask the credit bureau to send a notice of the correction to any creditor or insurer that has checked your file in the past six months. Once the errors are corrected, it is a good idea to get a new copy of your credit report several months later to make sure that the wrong information has not been reported again. But then, do not wait until the credit bureaus investigate the errors to contact your insurer. Tell your insurance company right away and ask if the errors will make a difference in your insurance. If errors are intolerable, it can make a significant difference in your premium. Some companies are unable to adjust the premiums until the score is corrected, but it does not hurt to ask. If you have taken the steps to improve your credit score, you should ask your insurance company to re-evaluate your credit score on renewal. So, better build a good credit history as early as now.
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