Can Bad Credit Prevent You from Getting Car Insurance?

Car insurance companies assess a potential policyholder’s risks by checking into a variety of factors. While other states allow auto insurance providers to deny policies to applicants with bad credit, drivers in California don’t have to worry about this issue. Although your credit history is a good indicator of your financial responsibility, it isn’t fair to everyone on the road to deny someone insurance based on a few late payments. However, you may find that other factors influence your ability to get car insurance. Exploring your options and how insurance companies assess a person’s ability to drive safely helps you plan to maintain financial responsibility as a driver.

Know the Valid Reasons for Insurance Policy Denials

Most people in California find their driving histories are the primary reason for auto insurance denials. However, most insurance companies simply set higher rates for premiums to still allow someone to get insurance while offsetting the risk of paying out more claims. You could also be denied insurance if the company finds you made fraudulent claims about your vehicle or other details. Someone who has a suspended license or has yet to earn one may also be denied insurance.

Understand Why Having Car Insurance Is Essential

Hitting a few roadblocks to getting insurance may cause you to consider forgoing a policy completely. But this could make it harder to get insurance in the future and leave you dealing with serious penalties from the moment you try to drive. Car insurance is a requirement for drivers on public roads in the state. You’ll also want to have auto insurance to avoid being held responsible for covering all of the costs for an accident, since medical expenses and auto repairs are expensive.

Create a Plan to Overcome Insurance Obstacles

The good news is you have options for making sure you can purchase auto insurance with bad credit or a poor driving record. High-risk drivers have the option of using the California Automobile Assigned Risk plan to get coverage when it’s hard to find an insurer to provide a policy. There’s also the California Low Cost Automobile Insurance Program that helps people with financial challenges find affordable car insurance. With both of these options, you’ll need to meet specific criteria for eligibility. Talking to your insurance agent can help you find out if you could receive assistance through these options.

Focus on Improving Your Driving Record & Financial Standing

Getting insurance coverage already puts you one step forward for improving your driving history and maintaining your finances. But you might also want to take further action. For instance, taking a driver training course can demonstrate your desire to be a good driver. You can also avoid having new accidents or violations added to your history over the upcoming year. Although your credit won’t impact your ability to get insurance, you may also choose to work on improving your score to achieve the best rates for policies in the future.

It’s always critical to make sure you have reliable insurance for your vehicle. If you need affordable, high-quality auto or motorcycle insurance, trust the experienced team at Altra Insurance Services. For a free quote, reach out to us today.