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Your credit can be a great indicator of how likely you are to file a home insurance claim. That’s why home insurance companies often consider your credit history when setting your home insurance rates.
If you live in California, Maryland, or Massachusetts, your credit won’t be important, as these states ban the use of credit information as a home insurance rating factor.1 If you’re in any other state and have a less-than-perfect credit history, you can still find affordable home insurance coverage by comparison shopping.
Here’s what you need to know to begin the search in your area.
Cheapest homeowners insurance companies for bad credit
While it’s possible to secure a homeowners insurance policy with bad credit, you’ll likely have to pay more for it. But if you take the time to shop around and compare your options, you may be able to find an affordable coverage option for your unique situation.
To help you with your search, here’s a list of some of the cheapest home insurance companies for people with bad credit.
Best overall home insurer for bad credit: Allstate
Best insurer for low rates with bad credit: Westfield
Best insurer for high-risk homes: American Family
Best insurer for high-value homes: AIG
How bad credit affects homeowners insurance rates
Credit plays a major role in how home insurance companies determine premiums. If you have bad credit, your insurer may perceive you as a high-risk customer. As a result, you might face more expensive rates than someone with a good-to-excellent credit history who may be less likely to file a claim.
Average homeowners insurance rates by credit tier
Here’s a look at how different credit scores can affect home insurance rates.
What to know about credit-based insurance scores
Credit-based insurance scores aim to predict the likelihood that you’ll file a home insurance claim. A poor score can position you as a risky consumer.
Insurers consider a number of factors when creating your credit-based insurance score, including your payment history, the age of your credit accounts, the types of credit you have, your credit card balances and credit limits, and any accounts in collections.
If your credit-based insurance score includes a history of late payments, high credit usage, collections on accounts, and several recent credit applications, you can expect higher homeowners insurance rates than a low-risk person with a higher credit score.2
How to get cheap home insurance with bad credit
If you have bad credit, these tips may help you land more affordable home insurance coverage.
Shop around. Take the time to explore different companies to find the one that best matches your particular budget and preferences. You can use an online comparison platform to review several different insurance offerings quickly.
Look into discounts. Many home insurance companies offer discounts to help policyholders save money on their insurance. Find out if you qualify for any discounts, such as a new home discount, bundling discount, or loyalty discount. You may even qualify for a discount you didn’t know existed.
Improve your home. Adding safety features can often lower your home insurance rates. This is particularly true if you live in an older home that costs more to insure. Ask your insurer if there are any applicable discounts for the installation of new safety features.
Review your coverage. Make sure you only invest in the home insurance coverage you need. If you find that you have an add-on you don’t need, for example, drop it.
Boost your credit score. Pay your bills on time, don’t rack up too much debt, and only apply for new credit when you absolutely need to. All of this will improve your credit history and your credit-based insurance score.
Can you get homeowners insurance without a credit check?
It’s possible to get home insurance without a credit check. But this isn’t guaranteed if you live in a state other than California, Maryland, or Massachusetts. Most home insurers outside these states will consider your credit history, so you should work to improve it and be wary of any insurer who claims to not check your history.3
Bad credit homeowners insurance FAQs
If you want to learn more about your options, check out this additional information about home insurance policies for people with bad credit.
What’s a good credit score for homeowners insurance?
A good credit score for a home insurance policy starts at around 690. If you have a lower credit score, you’ll likely pay higher rates for coverage.
Which homeowners insurance companies are cheapest for people with poor credit?
Allstate, Westfield, American Family, and AIG offer the most competitive rates for homeowners with bad credit. Keep in mind that the rates you receive will depend on your specific credit history, ZIP code, preferred deductible, home’s age, available discounts, and other factors.
Which companies offer cheap homeowners insurance without a credit check?
Most reputable home insurance companies consider your credit history when determining your rates. It can be difficult to find a home insurer that skips a credit check during the underwriting process.
Can an insurance company deny you coverage because of your credit?
Yes, a home insurance company can deny coverage due to your credit. The exception to this is if you live in California, Maryland, or Massachusetts, where an insurer can’t deny you coverage because of your credit.
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