OAI Study: Nevada Car Insurance Rates Could Double Due to Deteriorating Credit

LAS VEGAS, April 3, 2013 /PRNewswire/ -- A new study from OnlineAutoInsurance.com shows that Nevadans could be seeing big differences in their auto insurance rates depending on how healthy their credit history is. The analysis of nearly 6,000 quotes showed that going from having the best possible credit history to having the worst possible credit history pushed annual car insurance premiums upward by an average of 129 percent.

The results shed light on one more blow that Nevadans going through tough financial times may have to suffer. Events like foreclosures can seriously damage a person's credit and, though most Nevadans may not know it, the effects can bleed over into areas as seemingly unrelated as how much they pay to insure their cars.

Insurers in Nevada and most other states use what are known as credit-based insurance scores to price policies. These scores aren't calculated the same way as traditional credit scores but are based off of the same types of information to help assess risk.

Here are some ways a deteriorating credit-based insurance score could affect your Nevada rates, according to the study:

• Going from having the best possible score to an average/neutral score led to an average premium increase of 35 percent.
• Going from having an average/neutral score to the worst possible score led to an average premium increase of 69 percent.

"Even though financial history may seem unrelated to how good of a driver you are, claims statistics and studies repeatedly show that how responsible you are with your finances can be a good indicator of how much you'll end up costing your car insurer," said OAI manager Cesar Diaz. As a result, insurers likely charge you more for coverage if you have worse-than-average credit.

According to the study results, most Nevada insurers do factor your credit into your auto premium. Out of the 21 insurers included in the study, only two didn't raise rates after a credit downgrade.

To view the entire study, click here or navigate to the following address: http://www.onlineautoinsurance.com/research/nevada-credit-rating-study/

Members of the press can email [email protected] for results for specific Nevada cities.

OnlineAutoInsurance.com provides easy-to-use car insurance quote-comparison services to consumers along with informative content that can help you better understand how auto insurance works in your state and across the country.

SOURCE Online Auto, LLC