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What Is An Auto Insurance Score?

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Couple driving in a car

Your auto insurance score, also called a credit-based insurance score or an auto insurance credit score, measures how likely individuals are to file an insurance claim. Drivers who file fewer claims cost insurance companies less money and represent a lower insurance risk, so insurance companies use a variety of data available on applicants to determine which candidates have the lowest probability of filing a claim. To simplify that evaluation, specialized reports distill the relevant data into a number — the auto insurance score.

In other words, where credit scores rate a borrower’s creditworthiness, an auto insurance score rates an applicant’s coverage worthiness.

While your credit-based insurance score is not as widely influential as your credit score, it can still determine not just whether your application for car insurance will be approved but also the car insurance rates and premiums you’ll be expected to pay. Higher scores translate to more approvals and lower insurance rates, saving you money.

Here’s everything you need to know about your auto insurance score: what it is, how it’s calculated, how to check it and how to improve it if it’s not as high as you’d like.

How Your Auto Insurance Score Is Calculated

Auto insurance scores take eight factors into consideration:

  1. Negative public records, like foreclosures or liens
  2. History of late payments
  3. Length of credit
  4. Number of hard credit inquiries
  5. Number of credit accounts
  6. Number of open installment loans
  7. Types of credit
  8. Credit utilization ratio

You may recognize many of these as being determinants of your credit score. However, your credit-based insurance score takes these eight factors into account along with driving record and claims history to determine your auto insurance score.

Graphic: Research shows that credit-based insurance scores can effectively predict both the number of claims drivers file and the total cost of those claims.

Though auto insurance scores incorporate a broad range of personal information, there are many data points that are off-limits and will never be included in your auto insurance score:

  1. Race, ethnicity or nationality
  2. Religion
  3. Gender identity
  4. Marital status
  5. Home address or zip code
  6. Income, occupation or employment history
  7. Medical debt
  8. Bankruptcies older than seven years

While these factors can’t be used to determine your auto insurance score, they may be considered during the lender’s evaluation of your insurance application.

Your score will be calculated differently depending on which provider it comes from. There are three main agencies that provide auto insurance scores: the Fair Isaac Corporation (FICO), LexisNexis and TransUnion.

How It’s Used

Your auto insurance score is just one factor that insurance providers consider when evaluating whether or not to offer you coverage and how high your insurance premiums will be. Other factors an insurance provider may consider include:

  1. Driving history
  2. Accident and claims history
  3. Vehicle age, make, model and color
  4. Applicant’s zip code
  5. Gender and age
  6. Marital status
  7. Occupation
  8. Previous insurance coverage
  9. Annual mileage

Some states limit the information that car insurance companies can access when assessing an application. California, Hawaii and Massachusetts prohibit insurance providers from using credit scores in their approval or quotes processes. 

Graphic: People with no credit pay an average of 67% more for car insurance than people with excellent credit.

The Three Major Providers

Credit-based insurance scores vary depending on which of the three major providers the insurer chooses to use.

FICO Auto Score 9XT

FICO draws its data from TransUnion, which is one of the three primary credit bureaus responsible for traditional credit reporting. Its auto insurance scores range from 250-900, and its algorithm places special emphasis on borrowing habits that matter to auto lenders, like whether you’ve increased your overall debt in recent weeks and months.

The FICO Auto Score 9XT also places stronger weight on the individual’s past 30 months of behavior, so those with a checkered borrowing history who have made improvements in the year prior will benefit from the FICO algorithm.

LexisNexis Attract Auto Insurance Score

LexisNexis is a smaller credit reporting agency that specializes in industry-specific credit reports, including auto insurance scores. Its data is pulled from Equifax reports and its scores range from 500-997. 

When an auto lender orders an auto insurance score from LexisNexis, the report generated can include the borrower’s full credit report or it can consist of excerpts from the full report as well as analysis from the provider. LexisNexis also allows lenders to access report updates at each stage of the application process.

TransUnion CreditVision Auto Score

Unlike FICO and LexisNexis, TransUnion is one of the three major credit bureaus and also happens to provide credit-based insurance scores. TransUnion’s auto scores range from 300 to 850 and are, naturally, pulled from TransUnion’s own credit data.

Like other scores, CreditVision pulls data on past payment history and borrowing behavior, offering over five years of account patterns as well as scrutinous detail on the 30 months of history leading up to generation of the report. 

Graphic: The states where credit most impacts auto insurance premiums are New Jersey, Virginia, Michigan, Arizona, Texas, and Wisconsin

What’s a Good Auto Insurance Score?

Since the three major auto insurance scorers utilize different score ranges, a good score will vary depending on which bureau is issuing it. Generally, an auto insurance score of 770 or higher indicates that a borrower is a low-risk candidate for coverage, and will typically merit the borrower higher approval ratings and lower premiums.

Can I Check My Score?

Unfortunately, auto insurance scores aren’t accessible for free in the way that credit reports are. However, you can order your auto insurance score from the provider of your choosing. FICO offers access to an “Essentials” package that includes an auto insurance score for $19.95 per month, while individuals can order their LexisNexis score for a one-time fee of $12.95. TransUnion’s auto insurance score isn’t readily available — you’ll need to contact the bureau directly to find out how to order yours.

But while auto insurance scores aren’t free, they also aren’t nearly as important to check as credit reports are. Firstly, auto insurance scores don’t matter unless you’re planning on enrolling in or renewing an auto insurance policy. If you don’t own a car and aren’t in the market, there’s no reason to be concerned about your auto insurance score.

Even if you’re in the market for auto insurance, you don’t necessarily need to check your score directly. The factors that determine your auto insurance score overlap significantly with credit score factors, so you can assume that if your credit score is healthy, your auto insurance score is, too.

How to Improve Your Auto Insurance Score

Graphic: Credit Score vs. Auto Insurance Score

If you do check your credit score and find out it’s lower than you’d like (or if you apply for auto insurance and don’t receive the result you’re hoping for), there are a few ways you can raise your auto insurance score.

  1. Improve your credit score. The factors that influence your auto insurance score are largely the same as those that determine your credit score, so if you have bad credit, your auto insurance score will suffer. Raising your credit will improve your auto insurance score as well.
  2. Establish credit. If your problem is that you don’t have credit or your credit history is relatively short, focus on establishing credit by borrowing responsibly across a diverse range of debts and keeping your credit utilization ratio low.
  3. Ensure your credit reports are accurate. According to the Consumer Finance Bureau, one in five people has an error on at least one of their credit reports. If you maintain healthy financial habits but your scores are low, ensure there are no mistakes bringing down your credit report.
  4. Consider non-credit factors. Remember that auto insurance score is just one of several factors insurers consider when making decisions. If your auto insurance results are disappointing, the cause may lie outside the realm of your auto insurance score.

Since auto insurance scores are less commonly discussed than credit scores and aren’t free to order like credit reports, they can feel like they’re more confusing or complicated. But by maintaining the same financially healthy habits required to improve your credit, you can be sure your auto insurance score will be in good shape. 

If your finances aren’t as healthy as you’d like, you can figure out where to start making improvements by getting a free consultation and summary of the positive and negative elements affecting your credit report. Getting a clear look at the status of your credit from the perspective of a professional will give you a solid foundation with which to make a plan to improve your finances, credit, and auto insurance score, too.

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Credit Cards

Understanding Credit Card Security Codes

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The information provided on this website does not, and is not intended to, act as legal, financial or credit advice. See Lexington Law’s editorial disclosure for more information.

Credit card security codes are an important security measure to prevent fraud and identity theft. They add an additional layer of safety when making purchases and help ensure the buyer is, in fact, the cardholder.

These security codes—often called CVV codes, short for “card verification value”—are three- or four-digit codes located directly on your credit card. They’re typically, but not always, asked for when making card-not-present transactions, such as those made online and over the phone. Here, we detail where to find them, how they work and why they’re important for consumer protection.

Where to Find Your CVV Code

The location of your CVV code depends on the credit card issuer:

  • Visa, Mastercard and Discover: The code will be three numbers on the back of the card to the right of the “authorized signature.”
  • American Express: The code will be four numbers on the front of the card above and to the right of the card number.
Where to locate your card's security code.

How to Find Your CVV Code Without the Card

Credit card security codes were designed to ensure that the person making a purchase actually has the card in their possession. Because of this, it’s impossible to look up your CVV code without having the physical card. This is why it’s important to have the physical card on hand if you need to make a purchase that requires a CVV code.

If an identity thief obtains your credit card number—for example, via shoulder surfing—may try to call the bank and pretend to be you in order to get the CVV code. However, banks typically don’t give out this information. Each financial institution has their own policies, but if you can’t read or access your CVV code, they will usually issue you a new card.

While most retailers require a CVV code when making card-not-present transactions, many don’t. In these instances, crooks would still be able to use your card.

How Are CVV Codes Generated?

According to IBM, CVV codes are generated using an algorithm. The algorithm requires the following information:

  • Primary account number (PAN)
  • Four-digit expiration date
  • Three-digit service code
  • A pair of cryptographically processed keys

Other Names for CVV Codes

Depending on the credit card company and when your card was issued, your security code may go by a different name. Even though there are many different abbreviations, the basic concept remains the same. Below are all the abbreviations and meanings for credit card security codes:

  • CID (Discover and American Express): Card Identification Number
  • CSC (American Express): Card Security Code
  • CVC (Mastercard): Card Verification Code
  • CVC2 (Visa): Card Validation Code 2
  • CVD (Discover): Card Verification Data
  • CVV (All): Card Verification Value
  • CVV2 (Visa): Card Verification Value 2
  • SPC (Uncommon): Signature Panel Code

Credit Card Security Code Precautions

While CVVs offer another layer of security to help protect users, there are still some things to be aware of when making card-not-present transactions.

  • Sign the back of your credit card as soon as you receive it.
  • Keep your CVV number secure. Never give it out unless absolutely necessary—and if you fully trust the person.
  • Review each billing statement to ensure there are no transactions you don’t recognize or didn’t authorize. If there are, contact your financial institution immediately and consider freezing your credit.
Credit card security precautions.

Protecting your identity requires constant vigilance—but emerging technology may have the potential to mitigate some of the risk of credit card fraud.

Shifting CVVs: The Future of Credit Card Safety?

Since chip-enabled cards replaced magnetic stripes, in-person credit card fraud has taken a big dip. Crooks are turning toward online and card-not-present methods of fraud. CVV codes are good at combating this type of fraud—but shifting CVVs, also referred to as dynamic CVVs, may be even better.

The technology works by displaying a temporary CVV code on a small battery-powered screen on the back of the card. The code regularly changes after a set interval of time. This helps thwart fraud because by the time a hacker has illegally obtained a shifting CVV code and tried to make a purchase, it will likely have changed.

Despite the security benefits, shifting CVVs haven’t been widely implemented due to high cost, and it remains to be seen if the technology and process can scale. Financial institutions have many measures in place, such as fraud alert, to notify you of potentially suspicious activity.

If you suspect you’ve been a victim of identity theft, call your credit card company, change your passwords and notify any credit bureaus and law enforcement agencies. By regularly checking your credit card statements, being careful about who you give your information to and being vigilant when making purchases, you’ll help do your part in keeping your identity secure.


Reviewed by John Heath, Directing Attorney of Lexington Law Firm. Written by Lexington Law.

Born and raised in Salt Lake City, John Heath earned his BA from the University of Utah and his Juris Doctor from Ohio Northern University. John has been the Directing Attorney of Lexington Law Firm since 2004. The firm focuses primarily on consumer credit report repair, but also practices family law, criminal law, general consumer litigation and collection defense on behalf of consumer debtors. John is admitted to practice law in Utah, Colorado, Washington D. C., Georgia, Texas and New York.

Note: Articles have only been reviewed by the indicated attorney, not written by them. The information provided on this website does not, and is not intended to, act as legal, financial or credit advice; instead, it is for general informational purposes only. Use of, and access to, this website or any of the links or resources contained within the site do not create an attorney-client or fiduciary relationship between the reader, user, or browser and website owner, authors, reviewers, contributors, contributing firms, or their respective agents or employers.

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How Do Credit Card Miles Work?

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The information provided on this website does not, and is not intended to, act as legal, financial or credit advice. See Lexington Law’s editorial disclosure for more information.

Credit card miles are rewards points that help you earn credits toward travel and other purchases. How credit card miles work and whether this type of rewards card might be a good idea for you depends on a few factors, which we’ll cover below.

What Are Credit Card Miles, and How Do They Work?

Credit card miles are similar to credit card points. They’re a reward that you earn by taking certain actions, including making eligible purchases with the card.

Once you earn enough miles, you can redeem them for rewards. They’re called miles because typically these types of rewards credit cards are aligned with an airline or travel service. That usually means the most value comes from redeeming miles for airfare or rewards miles in an airline program.

However, you can often choose to redeem them for other rewards, such as merchandise, hotel and other travel credits or gift cards at a lesser value per point.

How Are Credit Card Miles Different From Frequent Flier Miles?

In some cases, credit card miles and frequent flier miles may be the same thing. If you have an airline-branded card, such as a Delta SkyMiles credit card, your points may be in the form of the airline’s frequent flyer miles. You can redeem those for flights or other rewards within the frequent flyer program.

If you have a non-branded card, then you may earn generic credit card miles. Those may be redeemed for flights with numerous airlines or other rewards, typically via the credit card rewards program’s online portal.

Hotel rewards cards work in a similar manner. If it’s a branded card, you may earn rewards directly via the hotel chain’s membership rewards program.

How Do You Earn Credit Card Miles?

The exact way you earn credit card miles depends on your card. But typically, you can earn by spending with your card to qualify for various rewards.

Use Your Credit Card Often

Rewards cards are designed to promote spending. You usually earn a certain number of miles or points for every dollar you spend on qualified purchases. In some cases, you can earn more by spending with certain retailers or on certain categories.

For example, it’s common for an airline-themed card to reward more for spending in travel categories. You might earn 3x miles or 5x miles for every dollar you spend with a certain airline, for example, and one mile per dollar on all other purchases.

The key to earning a lot of miles is using the card as much as possible for things you would already be buying and then paying the balance off immediately so you don’t owe interest. For example, if you earn two miles per dollar spent at grocery stores, you could use your credit card to cover your grocery shopping each week.

If you spend $200 a week, that’s roughly 1,600 miles earned per month just for doing grocery shopping you already do.

Take Advantage of Sign-Up Bonuses

Many rewards cards come with sign-up bonuses, and this is a great way to earn a lot of credit card miles right from the start. Typically, the bonus requires you to spend a certain amount of money when you first open the card.

For example, you might earn 50,000 miles if you spend $5,000 in the first three months as an account holder. That sounds like a lot, but it’s often achievable just by using the credit card to cover all normal expenses, such as fuel, groceries and even utility bills. Just make sure you’re paying off the card balance regularly so you don’t end up with a high utilization rate and expensive interest.

Refer Your Friends

Some credit card rewards programs offer extra miles if you refer friends. If your friend applies for the card using your referral code and is approved, then you may be awarded extra credit card miles.

How Much Are Credit Card Miles Worth?

The value of credit card miles varies, but typically they’re worth about one cent. That means if a flight costs $400, you need 40,000 miles to cover it. In some cases, you may be able to raise the value of your miles by redeeming them through a select online portal or via certain airlines.

Redeeming Your Miles

Follow the general steps below, as well as any unique instructions from your credit card company or rewards program, to redeem miles.

Check Your Balance

First, find out how many miles or points you have. This is typically listed on your last statement, but most credit cards support online account access where you can get up-to-date information about your points. You can also call your credit card company or rewards customer service line to find out.

Understand the Limitations

Before you plan on using miles to pay for travel, look at the fine print to understand restrictions. Some rewards programs have blackout dates, which means you might not be able to use miles to pay for airfare during peak times. Others require mile minimums, which means you need a certain amount of miles to redeem to cover part or all of your airfare.

And miles do expire, so make sure you keep track of when you earned the miles and when they will expire so you can redeem them beforehand.

Have a Flexible Schedule

Being flexible about when exactly you travel can also help you get the most out of credit card miles. For example, in some cases you can save hundreds on airfare by leaving a day earlier or later than planned. That means your miles can stretch further to cover more trips or tickets.

Choosing the Best Card for You

Earning and using credit card miles helps you boost your spending power. With the right credit card, you’re getting more than your original purchase when you buy things. But you do need to stick to recommended credit card use, such as paying off your bill every month and keeping your balance as low as possible.

Otherwise, you could end up paying high interest rates or driving down your credit score, and the miles you might earn in the process are not valuable enough to make up for those costs.

Which card you should get depends on your personal needs and preferences. Popular options include the Chase Sapphire Preferred Card, the Bank of America Travel Rewards card and the Capital One Venture Rewards card. These are unbranded cards that let you earn general miles.

If you fly regularly with a certain airline, you might be able to maximize value from a branded airline rewards card. Most rewards credit cards do require good or excellent credit. Check your credit before you apply so you know what cards you might qualify for.

And if you find anything inaccurate on your credit report that could be dragging down your score, reach out to Lexington Law for information on how we can help you dispute errors on your credit.


Reviewed by Kenton Arbon, an Associate Attorney at Lexington Law Firm. Written by Lexington Law.

Kenton Arbon is an Associate Attorney in the Arizona office. Mr. Arbon was born in Bakersfield, California, and grew up in the Northwest. He earned his B.A. in Business Administration, Human Resources Management, while working as an Oregon State Trooper. His interest in the law lead him to relocate to Arizona, attend law school, and graduate from Arizona State College of Law in 2017. Since graduating from law school, Mr. Arbon has worked in multiple compliance domains including anti-money laundering, Medicare Part D, contracts, and debt negotiation. Mr. Arbon is licensed to practice law in Arizona. He is located in the Phoenix office.

Note: Articles have only been reviewed by the indicated attorney, not written by them. The information provided on this website does not, and is not intended to, act as legal, financial or credit advice; instead, it is for general informational purposes only. Use of, and access to, this website or any of the links or resources contained within the site do not create an attorney-client or fiduciary relationship between the reader, user, or browser and website owner, authors, reviewers, contributors, contributing firms, or their respective agents or employers.

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Subsidized vs. Unsubsidized Loans – Lexington Law

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The information provided on this website does not, and is not intended to, act as legal, financial or credit advice. See Lexington Law’s editorial disclosure for more information.

The federal direct loan program offers subsidized and unsubsidized loans to college students. A federal direct subsidized loan is a loan where the government pays the interest while the student is in school. A federal direct unsubsidized loan is one in which the student is responsible for paying all interest, receiving no additional federal aid.

What Is the Difference Between Subsidized and Unsubsidized Student Loans?

The main differences between federal direct subsidized and unsubsidized loans are the qualification criteria, the maximum limits and how the loan interest works.

A chart displaying the differences between subsidized and unsubsidized student loans.

Loan Qualifications

Subsidized: To qualify for a subsidized loan, you must be an undergraduate student who can demonstrate financial need based on the information you submit through the Free Application for Federal Student Aid (“FAFSA”).

Unsubsidized: Unsubsidized loans are available to both undergraduate and graduate students, and there is no requirement to demonstrate financial need.

Maximum Loan Limits

Subsidized: Your school will determine exactly how much you can borrow each year, but there are federal limits. These limits are based on what year of school you are in and whether you file as a dependent or an independent. Subsidized loan limits tend to be lower than unsubsidized limits. The aggregate limit for an independent student with subsidized loans is $23,000.

Unsubsidized: Unsubsidized loan limits tend to be higher than subsidized loan limits. The aggregate limit for an independent student with unsubsidized loans is $34,500.

How Interest Accrues

Subsidized: The U.S. Department of Education pays the interest for subsidized loans as long as the student is enrolled in school at least half-time. They will also pay the interest during your grace period—defined as the first six months after leaving school—and any period of deferment. This means that the amount of the loan will not grow once the student graduates, since the government has been paying the interest.

Unsubsidized: Whether you’re an undergraduate or a graduate student, you’re responsible for paying all of the interest during the entire life of your unsubsidized loan.

What Are the Similarities Between Subsidized and Unsubsidized Student Loans?

When it comes to interest rates, fees and the “maximum eligibility period”—the amount of time you’re able to take out loans—subsidized and unsubsidized loans are virtually the same.

Fees

On top of interest, you can expect to pay a small fee for both types of loans. This is approximately 1.06 percent of your total loan amount, and it is deducted from each loan disbursement. 

Both subsidized and unsubsidized student loans have a fee of 1.06% of the total loan amount.

Undergraduate Interest Rates

The interest rates for both subsidized and unsubsidized loans for undergraduate students are the same. Currently, the rate is at 2.75 percent for loans first disbursed from July 1st, 2020, to June 31st, 2021. The one exception is for direct unsubsidized loans for graduate students, which have an interest rate of 4.30 percent. 

Maximum Eligibility Period

For both loan types, the time in which you’re eligible for your loans is equal to 150 percent of the time of your program. For undergraduates pursuing a four-year bachelor’s degree, this means they will be eligible for their loans for six years. Those pursuing a two-year associate’s degree will be eligible for three years. This ensures that students can still receive loans even if they’re unable or choose not to graduate within the program’s time frame. 

How to Apply for Subsidized and Unsubsidized Loans

Once you’re ready to apply for a federal direct loan, fill out the FAFSA. Your school will send you a detailed report of what student aid you’re eligible for. Any grants or scholarships are free money, so make sure to accept them. They’ll also decide which loans you’re eligible for, the amount you can borrow each year and what loan type you can get—subsidized or unsubsidized. 

No matter what type of student loan you go for, it’s important to understand how they affect your credit so that you can set yourself up for financial success after graduation. With responsible, on-time payments, you’ll be well on your way to healthy credit for life.


Reviewed by Cynthia Thaxton, Lexington Law Firm Attorney. Written by Lexington Law.

Cynthia Thaxton has been with Lexington Law Firm since 2014. She attended The College of William and Mary in Williamsburg, Virginia where she graduated summa cum laude with a degree in International Relations and a minor in Arabic. Cynthia then attended law school at George Mason University School of Law, where she served as Senior Articles Editor of the George Mason Law Review and graduated cum laude. Cynthia is licensed to practice law in Utah and North Carolina.

Note: Articles have only been reviewed by the indicated attorney, not written by them. The information provided on this website does not, and is not intended to, act as legal, financial or credit advice; instead, it is for general informational purposes only. Use of, and access to, this website or any of the links or resources contained within the site do not create an attorney-client or fiduciary relationship between the reader, user, or browser and website owner, authors, reviewers, contributors, contributing firms, or their respective agents or employers.

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