I Filed Bankruptcy Can I Get A New Auto Insurance Policy?

Auto Insurance & Bankruptcy

Auto Insurance & Bankruptcy

When you inquire about a new auto insurance policy the insurance company might run a consumer report check. During a consumer report check the three major credit bureau’s will report your individual scores and also your FICO score to the insurance company. Many insurance companies consider a driver with a score considered to be poor, a score under 600, to be a high risk. Some insurance companies will not offer a driver with this type of score a quote for auto insurance; however, some will but these companies will not give a driver with this type of credit history the lowest possible rates offered by this company.

Sometimes if a person files Chapter 13 which is a debt reassignment form of bankruptcy where the person pays back all or a portion of the debt the insurance company may look at this situation differently than any other form of bankruptcy. Many people who file Chapter 13 have more assets to protect and want to continue to stay in their house.

Bankruptcy does not mean the end of the road for you. Bankruptcy is more like a new beginning. When you first file for bankruptcy and are in the middle of the process no one will offer you a line of credit and it may not be a good time to open a new insurance policy; but when your bankruptcy is complete you will immediately begin to be offered credit. If you are going to open a revolving credit account your only option might be to put a security deposit down on a credit card. Your limit will match the security deposit. After several timely payments made on this card and on your first installment loan-which might be a vehicle loan-your credit score will begin to increase. If you feel as though you did not get the very best rate possible with the policy you purchased during or immediately following your bankruptcy case this is the time to again begin asking for quotes from other companies.

Many people are considering bankruptcy today and the insurance companies know this. The insurance companies are being a little more understanding of this and offering quotes to nearly everyone. Your best option might be to shop around and ask for several quotes. Every insurance company is different and therefore has different criteria on how they factor your credit score into your premium’s total. This is why it may be better for you to ask around to at least three carriers before making any commitments with an insurance company during and immediately following a bankruptcy.