Are There Companies That Have No Credit Check Car Insurance?

Drivers with bad credit scores typically pay higher car insurance premiums since insurers view them as more likely to file a claim. Thus, no credit check auto insurance tends to be appealing.

Although it’s difficult to find an insurance company that doesn’t check your credit score, there are other ways you can secure a more affordable quote. In this MoneyGeek guide, we dive into why credit scores are important, how credit influences your quotes and ways to find potential savings on car insurance.

• Are There Auto Insurance Companies That Don't Check Credit Scores?
• Why Do Auto Insurance Companies Check Credit Scores?
• How Does Credit Score Affect Auto Insurance Premiums?
• Ways to Save on Auto Insurance Premiums if You Have a Poor Credit Score
• Frequently Asked Questions

MoneyGeek found that no major auto insurance provider skips credit checks. However, laws in states such as California, Hawaii, Massachusetts and Michigan don’t allow insurance companies to use credit scores to set auto insurance rates. Therefore, providers operating in these states don’t conduct credit checks.

Meanwhile, certain states limit the use of credit checks. In Maryland, for example, some auto insurance companies can use credit scores to determine a driver’s premiums. However, insurance providers can’t refuse to insure or cancel a policy based on an applicant’s credit history. Additionally, Washington temporarily banned auto insurance companies from using credit scoring to set premiums in 2021.

While it’s tough to find an auto insurance company with no credit checks, you can still get a reasonable rate for car insurance, even with bad credit.

Insurance companies use credit-based insurance scores as a tool to determine policyholders’ risk levels, a practice that started in the early 1990s. In turn, these scores are used to compute a customer’s auto insurance premiums.

A 2007 report by Federal Trade Commission (FTC) found that drivers with poor credit scores filed more claims compared to those with excellent credit, marking the former profile as high risk. Underwriters use credit-based insurance scores to minimize risk to the insurance provider. It’s worth noting that since the FTC released this report, several state governments have been working to restrict or ban this practice.

Where you live can determine how your credit score affects your rates. Insurance companies in California, Hawaii, Massachusetts and Michigan can’t use credit scores to calculate your car insurance premiums.

The table below reflects how your credit score can affect your premiums depending on the state in which you live. In a national comparison, auto insurance costs an average of $1,424 per year for 100/300/100 full coverage with a $1,000 deductible.

If you’re concerned about your credit score, don’t worry. It’s not the only factor that providers consider when calculating your auto insurance premiums. There are other ways that you can obtain a lower car insurance rate. These are listed below.

No credit check car insurance can be enticing, especially for individuals with less-than-excellent credit scores. MoneyGeek answered some of the most commonly asked questions about no credit check car insurance.