Cheapest auto insurance rates by zip code are a crucial consideration for drivers seeking affordable coverage. Understanding how location impacts premiums requires examining various factors, from socioeconomic conditions and crime rates to population density and geographic location. This exploration delves into the complexities of auto insurance pricing, providing insights into data sources, influencing factors, and strategies for finding the best deals.
We’ll uncover how different insurers weigh these factors, leading to significant rate variations even within neighboring zip codes.
This analysis will equip you with the knowledge to navigate the complexities of auto insurance pricing and make informed decisions to secure the most cost-effective coverage for your needs. We’ll examine the role of driving history, vehicle type, and coverage options in shaping your final premium, while also highlighting the limitations of relying solely on zip code data for accurate rate comparisons.
By understanding the interplay of these factors, you can confidently compare quotes and find the best possible auto insurance rates.
Understanding the Data
Finding the cheapest auto insurance rates by zip code requires careful consideration of data sources and methodologies. The accuracy and reliability of the information you find directly impact the effectiveness of your search for affordable insurance. Understanding potential biases is crucial for making informed decisions.Reliable sources are essential for obtaining accurate and unbiased information on auto insurance rates.
Using unreliable sources can lead to incorrect comparisons and ultimately, the wrong insurance choice.
Reputable Sources for Auto Insurance Rate Data
Choosing reliable sources for auto insurance rate data is paramount. Different sources employ varying methodologies, impacting the results. Below are five reputable sources, along with their strengths and weaknesses:
- Insurance Companies’ Websites: Strengths: Provides direct quotes based on your specific information. Weaknesses: Requires individual searches across multiple companies, which can be time-consuming and may not provide a complete picture of the market.
- Independent Insurance Agents: Strengths: Access to multiple insurers, personalized advice. Weaknesses: May not provide a completely unbiased comparison as they may favor certain companies.
- State Insurance Departments: Strengths: Often publish aggregated data on average premiums by zip code. Weaknesses: Data may be delayed and may not reflect real-time pricing fluctuations.
- Consumer Reports: Strengths: Provides independent reviews and ratings of insurance companies. Weaknesses: May not offer direct rate comparisons by zip code.
- Insurance Rate Comparison Websites (e.g., NerdWallet, The Zebra): Strengths: Aggregate quotes from multiple insurers. Weaknesses: May not include all insurers in a given area, and methodologies for ranking can vary significantly.
Comparison of Data Methodologies Used by Insurance Rate Aggregators
Insurance rate aggregators employ different methodologies, leading to variations in the presented rates. These differences can stem from the data they collect, the algorithms used for analysis, and the way they present the results. For example, some aggregators might prioritize companies that pay them higher fees for referrals, potentially skewing the results toward less competitive options. Others might weight factors differently, such as customer reviews or claims history, which could influence the final ranking.
A comparison of the methodology employed by each aggregator is necessary for accurate interpretation of the data. Understanding these differences is key to avoiding potential biases and ensuring a comprehensive comparison.
Potential Biases in Publicly Available Zip Code-Based Insurance Rate Information
Publicly available zip code-based insurance rate information often presents biases. These biases can arise from several factors. One significant factor is the inherent correlation between zip code and demographic factors. Insurance companies use a multitude of factors beyond location to calculate premiums, including credit score, driving history, age, and type of vehicle. Since certain demographics tend to cluster within specific zip codes, using zip code alone can create misleading generalizations about average rates.
Another bias stems from the limitations of publicly available data. The data often represents averages, masking the significant variations in individual rates within a single zip code. Finally, the selection bias of the data source itself can play a role. Aggregators may not include all insurance providers, leading to an incomplete picture of the market. Therefore, caution is advised when interpreting zip code-based rate information.
Factors Influencing Rates by Zip Code
Auto insurance rates aren’t uniform across a city or state; they vary significantly by zip code. This variation reflects the complex interplay of several factors, primarily socioeconomic characteristics, crime and accident statistics, and geographic considerations. Understanding these influences allows consumers to better interpret rate differences and make informed decisions about their insurance choices.
Socioeconomic Factors Influencing Auto Insurance Rates, Cheapest auto insurance rates by zip code
Three primary socioeconomic factors significantly influence auto insurance rates at the zip code level: average household income, poverty rate, and homeownership rate. Higher average household incomes often correlate with better vehicle maintenance, lower likelihood of driving older, less-safe vehicles, and a greater capacity to afford comprehensive insurance coverage. Conversely, lower average incomes and higher poverty rates may be associated with increased risk due to older vehicles, less preventative maintenance, and a greater reliance on minimum coverage.
Similarly, higher homeownership rates can suggest greater stability and a reduced risk profile compared to areas with high rental rates, where transient populations might present higher risks to insurers.
The Impact of Crime Rates and Accident Frequency on Insurance Premiums
High crime rates and frequent accidents within a specific zip code directly impact insurance premiums. Areas with elevated rates of vehicle theft, vandalism, or collisions lead insurers to assess a higher risk profile. This increased risk translates into higher premiums for all drivers in that area, regardless of their individual driving history. For example, a zip code with a high rate of hit-and-run accidents might see significantly higher premiums than a zip code with a lower incidence of such incidents.
Insurance companies utilize statistical models and historical data to quantify this risk and adjust premiums accordingly.
Population Density and Average Household Income’s Influence on Insurance Costs
Population density and average household income are interconnected factors influencing insurance costs. Highly populated urban areas often experience more traffic congestion, increasing the likelihood of accidents. This increased risk, combined with potentially lower average household incomes in certain densely populated areas, can contribute to higher insurance premiums. Conversely, less densely populated areas with higher average household incomes may enjoy lower rates due to reduced accident frequency and a lower risk profile.
The interaction of these two factors creates a complex picture; a high-density, high-income area might still have higher rates than a low-density, low-income area due to the higher accident frequency.
Geographic Location’s Effect on Insurance Rates
Geographic location, specifically the distinction between urban and rural areas, significantly impacts insurance rates. Urban areas typically present higher risks due to factors like increased traffic congestion, higher population density, and increased opportunities for theft and vandalism. These factors lead to higher accident rates and higher insurance claims, resulting in higher premiums. Rural areas, on the other hand, often have lower accident rates and fewer opportunities for vehicle-related crime, leading to lower insurance premiums.
However, factors such as longer distances to emergency services in rural areas can sometimes offset this lower risk. Furthermore, the prevalence of specific hazards, such as severe weather events in certain regions, can also impact rates.
Data Visualization
Understanding the distribution of auto insurance rates across different zip codes is crucial for consumers seeking the best deals. Effective data visualization techniques can make this complex information easily accessible and understandable. We will explore how a user-friendly table and a textual representation can clarify the range and distribution of rates.
Creating a User-Friendly Table
A well-designed table provides a clear and concise way to present key insurance rate data for different zip codes. The table below demonstrates a sample format, showcasing average, highest, and lowest rates. Note that these are sample figures and actual rates will vary significantly based on many factors.
| Zip Code | Average Rate | Highest Rate | Lowest Rate |
|---|---|---|---|
| 90210 | $1500 | $2200 | $900 |
| 94107 | $1200 | $1800 | $700 |
| 77005 | $1800 | $2500 | $1200 |
| 10001 | $1600 | $2300 | $1000 |
Visual Representation of Rate Distribution
Imagine a horizontal bar chart representing the distribution of insurance rates across various zip codes. The x-axis represents the range of average annual insurance premiums, from the lowest to the highest observed rates. The y-axis would represent the number of zip codes falling within each rate range. The majority of zip codes would likely cluster in the middle range, representing average rates.
However, some zip codes would extend far to the right, representing significantly higher rates (outliers). These outliers could be due to factors such as high crime rates, a high concentration of luxury vehicles, or a lack of competition among insurance providers in that specific area. Conversely, a few zip codes might fall far to the left, indicating unusually low rates, perhaps due to high competition or a low-risk demographic profile within that area.
This visual representation would clearly show the concentration of rates and identify those zip codes with exceptionally high or low premiums.
Analyzing Rate Variations
Understanding why auto insurance rates fluctuate so dramatically, even between neighboring zip codes, requires examining a complex interplay of factors. These variations aren’t simply random; they reflect the statistical likelihood of accidents and claims within specific geographic areas. This section will delve into the reasons behind these significant differences, exploring the influence of income levels and the varying approaches of different insurance companies.
Reasons for Rate Variations Between Adjacent Zip Codes
Even seemingly identical areas can experience vastly different insurance rates due to subtle variations in risk profiles. For example, one zip code might encompass a high-traffic intersection or a section with a history of vandalism, leading to a higher frequency of accidents and claims than an adjacent zip code with quieter residential streets. Furthermore, the presence of local businesses, such as auto repair shops, can influence rates, as increased accessibility to repair services can slightly impact claim costs.
The availability and quality of emergency services, such as response times for ambulances and police, also play a role, as quicker response times can potentially mitigate the severity of accidents and resulting claim costs. These seemingly minor differences in local conditions can significantly impact the statistical risk assessment conducted by insurance companies.
Comparison of Rates in High-Income vs. Low-Income Zip Codes
Insurance rates often correlate with income levels, though not always directly. High-income zip codes may see higher rates due to a concentration of luxury vehicles, which are typically more expensive to repair or replace. The likelihood of drivers in these areas owning multiple vehicles or driving longer distances for work or leisure also contributes to higher risk assessments.
Conversely, low-income zip codes might experience higher rates due to factors like a higher concentration of older vehicles (which are often less safe and more prone to accidents), a greater reliance on public transportation (which can lead to more pedestrian accidents), or a higher incidence of uninsured drivers, increasing the financial burden on the insured population in case of an accident involving an uninsured driver.
It’s crucial to understand that these are statistical correlations, and individual circumstances within any given zip code will vary widely.
Impact of Varying Weighting of Factors by Insurance Companies
Different insurance companies utilize proprietary algorithms and risk assessment models, leading to variations in rates even within the same zip code. One company might heavily weight the frequency of accidents in a particular area, while another might prioritize factors such as the average age of vehicles or the driving history of residents. For example, one insurer might place a greater emphasis on credit scores, leading to higher rates for individuals with lower credit ratings, while another insurer might give less weight to this factor.
This results in a diverse range of rates offered by different providers within the same geographic location, giving consumers the opportunity to shop around and find the best deal for their specific circumstances. This underscores the importance of comparing quotes from multiple insurers before selecting a policy.
Impact of Driving History and Vehicle Type
Your driving record and the type of vehicle you insure significantly influence your auto insurance rates. Even within the same zip code, these factors can lead to substantial differences in premiums. Understanding their impact is crucial for securing the most affordable coverage. This section will explore how your driving history and vehicle choice affect your insurance costs.
Insurance companies assess risk based on various factors, and your driving history is a primary determinant. A clean driving record typically translates to lower premiums, reflecting a lower likelihood of accidents or claims. Conversely, a history of accidents, traffic violations, or at-fault collisions will significantly increase your rates. The severity of these incidents also plays a role; a major accident will have a more substantial impact than a minor fender bender.
Similarly, the frequency of incidents matters; multiple minor infractions can accumulate and lead to higher premiums than a single serious accident.
Driving History’s Influence on Insurance Rates
A driver’s history is a key factor in determining insurance premiums. Each incident is weighted differently by insurance companies, using a points system or similar methodology. For example, a speeding ticket might add fewer points than a DUI, resulting in a smaller rate increase. Multiple incidents within a short period will generally result in a more significant premium increase than the same number of incidents spread over several years.
This reflects the insurer’s assessment of ongoing risky driving behavior. Furthermore, some insurance companies offer discounts for drivers who maintain a clean record for a specified period, rewarding safe driving habits.
Vehicle Type’s Impact on Insurance Costs
The type of vehicle you drive is another major factor influencing your insurance premiums. Generally, vehicles considered more expensive to repair or replace, or those with a higher risk of theft or accidents, command higher insurance rates. For example, sports cars and luxury vehicles often have higher premiums than sedans or smaller vehicles. SUVs and trucks, while often safer in accidents due to their size and construction, tend to have higher repair costs and may therefore have higher insurance rates than comparable sedans.
This is due to the cost of parts and labor involved in repairs. The safety features of the vehicle are also a factor; vehicles with advanced safety technologies may receive discounts.
Comparison of Factors and Their Impact on Rates
The following bulleted list summarizes the impact of driving history and vehicle type on insurance rates:
- Clean Driving Record: Lower premiums, reflecting lower risk.
- Accidents: Significant premium increase, proportional to severity and frequency.
- Traffic Violations (Speeding Tickets, etc.): Moderate premium increase, dependent on severity and frequency.
- DUI/DWI: Substantial premium increase, often leading to significantly higher rates for several years.
- Sedans: Typically lower premiums due to lower repair costs and theft risk.
- SUVs and Trucks: Generally higher premiums due to higher repair costs and potential for greater damage in accidents.
- Sports Cars and Luxury Vehicles: Highest premiums due to high repair costs, higher theft risk, and often higher performance capabilities.
The Role of Insurance Company Policies
Insurance companies utilize a variety of underwriting policies that significantly impact auto insurance rates, even within a single zip code. These policies, combined with individual risk assessments, determine the final premium a driver pays. Understanding these policies helps consumers make informed decisions when choosing an insurer and coverage.Different insurers employ different risk assessment models and scoring systems. These models consider factors beyond those discussed previously, such as credit scores, claims history with other insurers, and even the type of vehicle a driver owns.
For example, one company might heavily weigh a driver’s credit score, leading to higher rates for those with lower scores, while another might prioritize driving history. This variation in emphasis creates differences in rates even for drivers residing in the same zip code.
Underwriting Policy Examples and Their Impact on Rates
Company A might have a stricter policy regarding accidents. A single at-fault accident could result in a substantial rate increase with Company A, while Company B might be more lenient, resulting in a smaller increase or even no change for the same driver. Similarly, Company C might offer discounts for drivers who bundle their auto and home insurance, while Company D might not offer such a bundle discount.
These variations lead to considerable differences in premiums for drivers in the same area. A driver with a minor accident might find significantly higher rates with Company A compared to Company B, illustrating the impact of differing underwriting policies.
Impact of Coverage Options on Overall Cost
The choice of coverage significantly impacts the overall cost of auto insurance. Liability coverage, which pays for damages to others in an accident you cause, is typically required by law and is the most basic coverage. Collision coverage, which covers damage to your vehicle in an accident regardless of fault, and comprehensive coverage, which covers damage from events like theft or hail, are optional but can significantly increase premiums.
A driver opting for full coverage (liability, collision, and comprehensive) will inevitably pay more than a driver only carrying the state-mandated liability coverage. The price difference between these options varies by insurance company and location, but the trend remains consistent. For example, a driver in a high-risk zip code might see a much larger difference in premiums between liability-only and full coverage compared to a driver in a low-risk area.
This is due to the increased likelihood of accidents and claims in higher-risk areas, making optional coverage more expensive.
Finding the Best Deal
Securing the cheapest auto insurance rates requires a proactive and informed approach. While zip code significantly influences premiums, consumers possess considerable control over the final price by strategically comparing quotes from multiple insurers. Understanding this process empowers you to make the most cost-effective choice.Finding the lowest auto insurance rate involves more than just checking one company’s website.
A comprehensive comparison across several providers is essential to ensure you’re getting the best possible deal for your specific needs and risk profile. This involves a systematic approach that considers various factors beyond just the quoted price.
Comparing Insurance Rates Across Providers
To effectively compare auto insurance rates, follow these steps:
- Gather Necessary Information: Before starting, collect your driver’s license, vehicle information (make, model, year), and details about your driving history (accidents, tickets). Having this information readily available streamlines the quote process.
- Use Online Comparison Tools: Many websites allow you to enter your information once and receive quotes from multiple insurers simultaneously. This saves considerable time and effort. Be aware that these tools may not include every insurer in your area.
- Visit Insurer Websites Directly: Supplement online comparison tools by visiting the websites of individual insurance companies. This ensures you capture all available options and potential discounts.
- Contact Insurers Directly: For personalized service and to clarify specific policy details, consider contacting insurers directly via phone or email. This allows you to ask questions and discuss any unique circumstances that might affect your rate.
- Compare Apples to Apples: When reviewing quotes, ensure you’re comparing policies with similar coverage levels. A lower premium with significantly less coverage might ultimately prove more expensive in the event of an accident.
- Consider Discounts: Many insurers offer discounts for various factors such as safe driving records, bundling insurance policies (home and auto), and completing defensive driving courses. Inquire about all available discounts.
- Review Policy Details Carefully: Before committing to a policy, thoroughly review all the terms and conditions, paying close attention to deductibles, coverage limits, and exclusions.
The Importance of Shopping Around
Shopping around for auto insurance is crucial because rates can vary significantly between companies, even for drivers with similar profiles in the same zip code. Different insurers utilize varying algorithms and risk assessment models, leading to diverse pricing structures. By obtaining multiple quotes, you can identify the insurer offering the most competitive rate without compromising necessary coverage. For example, a driver in a high-risk zip code might find a difference of hundreds of dollars annually between the cheapest and most expensive insurer.
This underscores the critical need for comparison shopping.
Limitations of Zip Code-Based Data
While using zip codes to find cheaper auto insurance rates offers a convenient starting point, relying solely on this data presents significant limitations. It provides a broad overview of risk within a geographic area but fails to capture the nuances of individual driving habits and circumstances. This can lead to inaccurate rate estimations and potentially unfair pricing for some drivers.Zip codes primarily reflect the aggregate risk profile of a geographic region, encompassing factors like crime rates, accident frequency, and average income levels.
However, these are general indicators and do not account for the wide range of individual risk factors that influence insurance premiums. Using zip code alone ignores the considerable variation within a single zip code itself.
Inherent Variability Within Zip Codes
A single zip code can encompass diverse neighborhoods with vastly different risk profiles. For instance, a zip code might include both affluent, low-crime areas and high-crime, high-accident areas. Someone living in a safe, quiet neighborhood within that zip code might be unfairly penalized with higher premiums due to the overall risk associated with the zip code as a whole.
This highlights the need for a more granular approach to risk assessment that considers individual characteristics. Using only the zip code averages out these differences, leading to potential inaccuracies in rate calculations.
Ignoring Individual Risk Factors
Insurance companies base rates on a comprehensive assessment of risk, going far beyond simple geographic location. Crucial factors such as driving history (accidents, tickets, and claims), age, gender, credit score, vehicle type, and even occupation significantly influence premiums. A zip code cannot capture this individualized information. For example, two individuals living in the same zip code might have drastically different premiums based on their driving records.
One might be a safe driver with a clean record, while the other might have multiple accidents and traffic violations. Using only zip code data would fail to differentiate between these individuals.
Potential for Bias and Discrimination
Over-reliance on zip code data can inadvertently perpetuate biases and discriminatory practices. If certain demographics are concentrated in specific zip codes with higher accident rates, using zip codes alone might result in higher premiums for individuals from those demographics, regardless of their personal driving history. This could lead to unfair and inequitable pricing. This underscores the importance of using a holistic approach to risk assessment that avoids relying on potentially biased proxy variables.
Future Trends in Auto Insurance Pricing
The auto insurance industry is undergoing a significant transformation, driven by technological advancements and evolving consumer expectations. Traditional methods of risk assessment are being augmented, and in some cases replaced, by data-driven approaches that promise greater accuracy and fairness in pricing. This shift is leading to more personalized premiums and a greater emphasis on individual driving behavior.The use of telematics and personalized risk assessment are two key drivers shaping the future of auto insurance pricing.
These technologies allow insurers to move beyond broad demographic-based assessments and instead focus on the specific driving habits and risk profiles of individual policyholders. This leads to a more nuanced understanding of risk, allowing for fairer and more accurate pricing.
Telematics and Usage-Based Insurance (UBI)
Telematics involves the use of in-vehicle devices or smartphone apps to collect data on driving behavior. This data, which can include speed, acceleration, braking, mileage, and even time of day driving occurs, is then used to create a personalized risk profile for each driver. Insurers offering Usage-Based Insurance (UBI) programs use this data to adjust premiums based on individual driving habits.
For example, a driver who consistently maintains safe speeds and avoids harsh braking will likely receive a lower premium than a driver with a more aggressive driving style. Several major insurance companies already offer UBI programs, and their adoption is expected to increase significantly in the coming years. The increased accuracy in risk assessment leads to more equitable pricing – rewarding safe drivers with lower premiums and potentially incentivizing safer driving behaviors across the board.
Personalized Risk Assessment Using Advanced Data Analytics
Beyond telematics, insurers are leveraging advanced data analytics to refine their risk assessment models. This includes incorporating data from various sources, such as credit scores (where legally permissible), socioeconomic factors, and even social media activity (with appropriate privacy considerations). These data points, when combined with traditional factors like age and driving history, create a more comprehensive picture of a driver’s risk profile.
For instance, an analysis might reveal that drivers in a particular zip code with a certain credit score and social media engagement pattern have a statistically lower likelihood of accidents, allowing for more finely tuned premiums. However, it is crucial to ensure that these models are fair and do not discriminate against certain demographics. Transparency and ethical considerations are paramount in the development and application of these advanced analytics.
The Rise of AI and Machine Learning in Pricing
Artificial intelligence (AI) and machine learning (ML) are increasingly being integrated into auto insurance pricing models. These technologies allow insurers to analyze vast amounts of data to identify complex patterns and relationships that might be missed by traditional methods. This can lead to more accurate predictions of risk and more personalized pricing. For example, AI algorithms can identify subtle correlations between seemingly unrelated data points, leading to more precise risk assessments and potentially more competitive pricing for low-risk drivers.
The use of AI also facilitates the automation of many processes, streamlining operations and potentially reducing administrative costs, which could translate to lower premiums for consumers.
Regulatory Considerations: Cheapest Auto Insurance Rates By Zip Code
State regulations play a crucial role in shaping the auto insurance landscape and, consequently, the rates offered by zip code. These regulations directly influence the factors insurers consider when calculating premiums, ultimately affecting the cost of insurance for individuals within specific geographic areas. Understanding these regulations is vital for consumers seeking the most affordable options.State insurance departments establish minimum coverage requirements, permissible rating factors, and oversight of insurer practices.
These regulations vary significantly across states, leading to considerable differences in average insurance costs across the country. For instance, a state with mandatory minimum coverage limits that are substantially higher than another state will likely see higher average premiums, regardless of zip code. Furthermore, the allowed rating factors (such as credit scores, driving history, and age) and the weight given to each factor also differ significantly, resulting in varying rates.
Minimum Coverage Requirements
Minimum liability coverage requirements mandated by each state significantly influence insurance rates. States with higher minimum liability coverage requirements generally have higher average insurance premiums. Insurers must price their policies to cover potential claims, and higher minimums necessitate higher premiums to ensure adequate reserves. For example, a state requiring $100,000 in bodily injury liability coverage will likely have higher rates than a state requiring only $25,000.
This is because the potential payout for a serious accident is considerably greater in the former scenario.
Permitted Rating Factors
State regulations dictate which factors insurers can use to determine premiums. Some states allow the use of credit scores, while others prohibit it. Similarly, some states place restrictions on the weight given to factors like age or driving history. For instance, a state that prohibits the use of credit scores in rate calculations might see a more even distribution of premiums across different socioeconomic groups within a zip code, compared to a state that permits its use.
The permitted use of telematics data, which tracks driving behavior, also varies by state and can significantly impact rates.
Regulatory Oversight and Market Competition
State insurance departments oversee the practices of insurance companies, ensuring fair and competitive pricing. This oversight includes reviewing rate filings, investigating consumer complaints, and taking action against insurers engaging in unfair or deceptive practices. Stronger regulatory oversight can promote market competition, potentially leading to lower premiums for consumers. Conversely, less stringent regulations might allow insurers greater leeway in setting rates, potentially resulting in higher premiums, especially in areas with limited competition.
The level of market competition within a state also influences rates, as a more competitive market generally leads to lower prices.
Closing Summary
Finding the cheapest auto insurance rates by zip code involves more than simply searching online. It requires a comprehensive understanding of the factors that influence pricing and a strategic approach to comparing quotes from multiple insurers. By considering socioeconomic factors, driving history, vehicle type, and coverage options, consumers can make informed decisions and secure affordable yet comprehensive auto insurance protection.
Remember that while zip code provides a starting point, a thorough individual risk assessment is crucial for obtaining the most accurate and beneficial rates.
Detailed FAQs
What is the most reliable source for auto insurance rate data?
There is no single “most reliable” source. It’s best to consult multiple reputable sources (e.g., insurance comparison websites, state insurance departments) and compare their methodologies to get a well-rounded view.
Can I trust online auto insurance quote generators?
Online quote generators can be helpful for initial comparisons, but remember that they often provide estimates. Always verify the final quote directly with the insurance company.
How often should I shop around for auto insurance?
It’s recommended to compare rates annually, or even more frequently if your circumstances change significantly (e.g., new car, change in driving record).
Does my credit score affect my auto insurance rates?
In many states, your credit score is a factor in determining your insurance rates. Maintaining a good credit score can lead to lower premiums.