First off let’s start with the importance of having auto vehicle insurance for every individual owning a vehicle. Insurance acts as financial support at the time of difficulty, it covers the expenses in case there is an accident or any other liability. And it has been found that people that have a bad credit history are facing problems in the process of achieving auto insurance. Visit Theislandnow for more information.

How does bad credit affect the insurer?

It is known that more than 90% of the insurance companies before offering their policies to their customers check their credit history. The impact of the insurance rate that is linked with the credit rate is great and this practice is banned in almost all the states except that of Massachusetts, Hawaii, and California. People with good credit history can easily avail of the policies as they are found to be more trustable and safe whereas people with bad credit are affected with an increase in cost for their car loan. Car insurance bad credit affects the amount of down payment and also increases the cost of the loan associated. Also one of the most asked questions is how bankruptcy plays a part in affecting the car insurance rates? The answer is simple it depends mostly on the credit ratings. The thing is once a person goes bankrupt it is recorded and this record lasts for up to 10 years and greatly affects your credit score as it is a negative thing for bad credit car insurance.