Impress your insurer with good credit
A high credit score can get you more than a favorable interest rate on a car loan or mortgage. It also can result in lower home insurance premiums.
Insurance companies check credit reports to gauge whether a customer is likely to cost them in the future, Lemons says. Wilson adds: "The stats show people that have a better credit score have fewer claims." Given that connection, insurers are willing to charge less if you have good credit.
But what constitutes a good credit score, for insurance purposes? It varies. Each company uses its own calculation to determine how much a credit score will impact premiums, which is another reason it pays to shop around and ask questions.
Indeed, Wilson says a quote for his own home insurance was unusually high, and it turned out that the wrong credit score was being used. Once he inquired about it, the premium dropped -- by roughly $1,000.
For a married couple, the insurer will take the better of the two credit scores and use that to rate the policy.