Home Insurance Score vs. Credit Score – What Is the Difference?


Your credit score and home insurance score are both statistical calculations taken from information on your credit report. The company inserts into an algorithm provided by FICO to arrive at a number that becomes your score. Despite these similarities, the two scores differ in the information considered to calculate the numerical value and the way the company uses scores.

Information Used in Each Score

When calculating your credit score, credit bureaus use your debt amount, payment history, how many accounts you have open, and the amount of time you have had credit. The home insurance score may use the same information from your credit report, along with your history of insurance claims, and the presence of safety features in your home, such as fire alarms. Other information may be used to figure out your home insurance score, but this depends on the type of scoring model used by your home insurance company.

There are also specific factors that your insurance company cannot consider when calculating your insurance score. These factors include personal characteristics such as age, marital status, race, and gender. The final score also does not include information about your employment, the location of your home, or any other information not found on your credit report.

How Each Score is Used

Both your credit score and home insurance score are used by companies to decide how much of a risk you pose to a lender or policyholder. However, the risks determined by the two scores are very different.

Your credit score is used by banks, mortgage companies, and other financial institutions to determine how likely it is that you will pay your debts back on time. In contrast, your home insurance credit score is reviewed by insurance companies to figure out how likely it is that you will need to file an insurance claim in the future.

How Does Your Home Insurance Score Affect Your Insurance Premiums?

Once calculated, your home insurance credit score is one of the factors the insurance company uses to determine your premium amount. A higher home insurance score means you pose a low risk for filing an insurance claim, while a lower score indicates you pose a high risk for filing a claim. Therefore, a higher score usually means your premiums are less than someone with a lower score.

Other Factors in Home Insurance Premium Amounts

Some states do not allow the insurance company to use the home insurance score as the sole factor to determine your premium amount. These are some other factors the insurance company may consider:

  • The cost of rebuilding your home
  • Materials used in your home
  • The year your house was built
  • Fire protection in your location
  • Claims history in your area
  • Pets you own

If you have additional questions about your home insurance premiums or would like to receive a free Greenville insurance quote, please call us or reach out using the quote form. We’re happy to answer any questions you might have about your homeowner’s and other insurance policies.

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