While most major insurers use credit, companies like CURE Auto Insurance (NJ, PA, MI), Dillo Insurance (TX), and Root Insurance (focuses on driving) are known for not using credit scores, with some states like California, Hawaii, Massachusetts, and Michigan prohibiting their use entirely. Nationwide, Allstate, and Liberty Mutual also offer options or discounts for those avoiding credit checks, often through usage-based programs like Nationwide's SmartRide or Allstate's Milewise.
While major insurers including State Farm, GEICO, and Progressive use credit scores to determine rates, regional insurers CURE Auto Insurance (available in NJ, PA, MI) and Dillo Insurance (available in TX), do not. However, if you live in CA, HI, MA, or MI, laws prevent insurers from using credit to determine rates.
Most insurers use credit checks to create a credit-based insurance score to help set your rate. Some insurers provide auto insurance with no credit check, which might seem appealing if you have a poor credit history.
In most states you can't be denied insurance solely for credit, though many companies will use credit as a component of eligibility (ex: someone with poor credit has to meet stricter accident/violation criteria than someone with good credit).
The most affordable auto insurance for drivers with bad credit is from Nationwide, GEICO or USAA, according to our research.
According to a survey by Conning and Co., over 92% of all major insurers, including GEICO, use credit-based insurance scores to help determine insurance premiums in most states.
California
Insurance companies in California don't use credit-based scores or your credit history for underwriting or rating auto policies, or setting rates for homeowners insurance. As a result, your credit won't impact your ability to get or renew a policy, or how much you pay in premiums.
It's partly true: most negative items like late payments and collections are removed from your credit report after about seven years, but the underlying debt often still exists, and bankruptcies (Chapter 7) last 10 years, so your credit isn't entirely "clear" but mostly refreshed from old negatives. The 7-year clock starts from the date of the original delinquency, not when you paid it off or sent to collections, and the debt itself can still be pursued by collectors.
While the vast majority of insurance companies use credit-based insurance scores to help determine the price of insurance, it is banned in the states of Massachusetts, Michigan, Hawaii, and California. Some states only allow it as a factor for property insurance like auto and homeowners insurance.
It is a common pricing factor because of its apparent accuracy in helping auto insurers predict risk. Your credit score won't be considered if you live in certain states (California, Hawaii, Maryland, or Massachusetts) because state law prohibits it.
Make your monthly payments in the way that works for you. Payment options include Apple Pay, debit and credit cards, and other methods. See information about healthcare costs, medical claims, and more.
For most people, increasing a credit score by 100 points in a month isn't going to happen. But if you pay your bills on time, eliminate your consumer debt, don't run large balances on your cards and maintain a mix of both consumer and secured borrowing, an increase in your credit could happen within months.
Buy Here, Pay Here (BHPH) dealerships are another viable option for those without a credit history. These dealerships finance the cars themselves, bypassing traditional lenders. The key advantage here is that they often don't require credit checks.
Key Things to Know About How State Farm Uses Your Credit Score. State Farm will assign you an auto insurance score, which is based on your credit history, just like your credit score.
Pay your bills on time.
One of the most important things you can do to improve your credit score is pay your bills by the due date. You can set up automatic payments from your bank account to help you pay on time, but be sure you have enough money in your account to avoid over- draft fees.
A: True no credit check options are limited but available through specific regional insurers like CURE and Dillo, usage-based programs, and in states that prohibit credit-based pricing. All major insurers perform credit checks in most states.
Progressive Leasing will only make soft inquiries to the big three Credit Bureaus (Transunion, Experian & Equifax).