When most people think about their credit score, they think about qualifying for a mortgage, getting a car loan, or applying for a credit card. But there’s another area where your credit score can have a big impact, your auto insurance rates.

It might surprise you to learn that in most states, including Oklahoma, insurance companies can use a version of your credit score, called a credit-based insurance score, to help determine your premiums. That means your financial habits could be affecting how much you pay for car insurance every month.

At McCann Insurance, we’ve helped drivers in Durant and across Oklahoma understand why credit matters, how it’s used, and what you can do to improve your rates. In this article, we’ll break it down in simple terms.

What Is a Credit-Based Insurance Score?

A credit-based insurance score is similar to your regular credit score, but it’s designed specifically for predicting insurance risk rather than lending risk.

While a traditional credit score predicts how likely you are to repay a loan, a credit-based insurance score predicts how likely you are to file an insurance claim. Insurance companies have found that people with higher credit scores tend to file fewer claims, while those with lower scores file more.

Your insurance score is calculated using many of the same factors as your regular credit score, including:

• Payment history (on-time payments vs. late payments)
• Outstanding debt
• Length of credit history
• Types of credit accounts
• Recent credit inquiries

It’s important to note that your driving record and other factors, like your vehicle type, mileage, and where you live, also play a big role in your premium. Your credit score is just one piece of the puzzle.

Why Do Insurance Companies Use Credit Scores?

The short answer is: because statistics show it works. Multiple studies over the years have shown a strong link between credit-based insurance scores and the likelihood of filing a claim.

From the insurer’s perspective, it’s all about risk assessment. If you’re statistically less likely to have an accident or file a claim, you represent a lower risk to the insurance company, and lower risk often means lower rates.

Think of it this way: just like your driving history reflects your habits on the road, your credit history reflects your habits in managing responsibilities. Insurance companies see both as indicators of how likely you are to have future claims.

How Your Credit Score Impacts Your Rates

Here’s a simplified example:

Let’s say two drivers in Durant, Oklahoma, are the same age, drive the same vehicle, have similar driving records, and live in the same neighborhood. The only big difference? Their credit scores.

• Driver A has an excellent credit score.
• Driver B has a poor credit score.

Even with all other factors being equal, Driver A is likely to pay significantly less for the same coverage. In some cases, the difference can be hundreds of dollars per year.

For Oklahoma drivers, this is especially important because our state allows insurance companies to use credit scores when calculating rates. That means improving your credit score can directly lead to lower car insurance premiums.

Factors That Matter More Than You Think

It’s not just about paying your bills on time (though that’s a big part of it). Insurance companies may also consider:

1. Credit Utilization – The percentage of your available credit that you’re using. Keeping this number low can help your score.
2. Length of Credit History – Older accounts can help, as they show a long track record of responsible use.
3. Types of Credit – A healthy mix of credit cards, installment loans, and other accounts can improve your score.
4. Hard Inquiries – Applying for too much credit in a short time can temporarily lower your score.

These factors aren’t unique to insurance; they’re the same things that matter for your regular credit score. But because they also influence your insurance score, improving them can have a double benefit.

Other Factors That Affect Auto Insurance Rates

While your credit score is important, it’s far from the only thing that determines your auto insurance rates. Insurance companies in Oklahoma also consider:

• Driving history (accidents, tickets, violations)
• Age and experience
• Vehicle type and value
• Annual mileage
• Location (Durant city limits vs. rural areas can differ)
• Coverage limits and deductibles

That’s why we always look at the full picture when helping clients shop for coverage. At McCann Insurance, we don’t just check one company; we compare rates from multiple carriers to find the best overall fit for your situation.

How to Improve Your Credit Score (and Your Insurance Rates)

The good news is that your credit score isn’t set in stone. By making a few consistent changes, you can improve your score over time and potentially lower your premiums. Here are some proven strategies:

1. Pay Bills on Time – Your payment history is one of the biggest factors in your score. Even one missed payment can have a big impact.
2. Reduce Credit Card Balances – Aim to use less than 30% of your available credit.
3. Avoid Opening Too Many New Accounts – Each hard inquiry can temporarily lower your score.
4. Check Your Credit Report for Errors – Mistakes happen, and correcting them can give your score a quick boost.
5. Keep Old Accounts Open – A longer credit history generally works in your favor.

Improving your credit score takes time, but the payoff can be worth it, not just for lower insurance rates, but for better loan terms and financial opportunities in general.

What If You Have No Credit or Poor Credit?

If your credit score is low or you have no credit history, don’t panic. You can still get auto insurance in Oklahoma, it just might cost a bit more initially.

That’s where an independent insurance agency like McCann Insurance can help. Because we work with multiple carriers, we can shop around to find the company that offers the most competitive rates for your situation. We can also help you adjust your coverage and deductibles to make your policy more affordable while you work on improving your score.

The McCann Insurance Advantage

As a local, independent agency in Durant, Oklahoma, we’re not tied to one insurer’s rates or rules. That means we can:

• Compare multiple quotes side-by-side
• Explain exactly how your credit score is impacting your premiums
• Recommend carriers that are more forgiving of lower scores
• Help you plan a path to lower rates in the future

Our goal isn’t just to sell you a policy; it’s to make sure you understand how it works, why it costs what it does, and how you can save money long-term.

The Bottom Line

Your credit score is more than just a number on a loan application; it’s also a factor that can directly affect how much you pay for auto insurance in Oklahoma. By understanding the connection between credit and insurance rates, you can take steps to improve your score and, in turn, lower your premiums.

At McCann Insurance, we believe informed drivers make smarter financial decisions. Whether your credit is excellent, average, or needs some work, we’ll help you find coverage that fits your needs and your budget.

Ready to see how your credit score affects your auto insurance rates? Contact McCann Insurance in Durant today at 580-916-9808 for a free, no-obligation quote. We’ll compare options from top-rated carriers and help you find the right coverage at the right price, no matter where your credit stands.