Purchasing an insurance policy is an important decision, since you want to make sure it protects you from various risks and exposures without being overly expensive. However, if your policy is a bit pricey at the time of purchase, but you know it is the best one for your needs, do not get discouraged, as making your payments on time can help lower your insurance rates at the time of renewal.
Paying your premiums on time will positively contribute toward your credit history, and most insurance companies offer lower rates to people with good credit history. This is based on the assumption that people with good credit record are lower-risk customers compared to people with low credit scores, because they are responsible with their finances. According to statistics, people with poorer credit scores pay from $68 up to $526 more each year on car insurance compared to the drivers with similar policies and excellent credit history.
Maintain good credit record to receive lower rates on your insurance policy. However, keep in mind that if you are late with your payments, your credit score can lower which will lead to an increase in your insurance rates. If you would like to know more about how your credit score affects your insurance rates, you can speak to your carrier directly or consult an independent agent at Team Insurance.