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Can my credit score affect my life insurance premium?

Find out if your credit score can affect your eligibility for life insurance or how much you’ll pay for coverage.

Does credit score affect life insurance premiums?

Your credit history reveals information about how you handle your financial responsibilities, and your credit score is one of the major factors a bank relies on to determine how much interest you’ll pay on that loan you want. Increasingly, credit history is being factored into many more decisions about our lives including auto insurance, adoption, and employment. Yet, when it comes to life insurance, insurers may not look at this type of information the same way other industries do.

Keep in mind: underwriting guidelines vary from insurance company to company, and so we can’t speak to what each individual insurer will look at. For this, we’ll focus on the guidelines for the Haven Term policy, which is issued by our parent company MassMutual, and how credit attributes may be used to help flag if underwriters need to understand more about an applicant. During the application and underwriting process, your credit score is not used to determine premium pricing or eligibility. When you apply for a Haven Term policy, your credit info is only used to determine whether additional information is needed.

Why might life insurance companies check your credit?

During the underwriting process, many insurers analyze self-reported lifestyle and health information and pair it with third-party data sources that provide insights about your prescription history, past applications for life insurance, driving records, and criminal history.

Once a life insurance application is submitted, an insurer reviews these public records to determine if they need to ask follow-up questions to understand more about your financial or health picture. Your credit attributes, not your credit score, may be one of the things they will review in the underwriting process.

An example of a credit attribute that life insurance companies would look at is whether or not you have filed for bankruptcy. While for many people, bankruptcy can be a result of unfortunate events beyond their control, for others it can indicate poor decision-making or even be a red flag for medical problems because many bankruptcies are the result of medical bills.

Personal records that do impact life insurance premiums

While a life insurance company isn’t looking to see whether you have a balance on your credit card, there are other public records that can have an impact on eligibility and pricing.

DUI/DWI convictions, for example, are part of these public records and will show up in the underwriting process. Multiple convictions of drinking and driving can illustrate to an insurer a pattern of high-risk behavior that can ultimately increase mortality risk. The same can be said for having a criminal history.

Additionally, your prescription history will be reviewed and compared with the health information reported in the application. For example, at Haven Life, once an application is submitted, these public records are reviewed in real-time. If there are follow up questions on a prescription drug you have taken in the past, you’ll receive them in the same session.

(Read more on factors that impact your life insurance premium here.)

When it comes to buying life insurance, for most people, your credit attributes are far less important than your age and health history. The amount of information reviewed by an insurer can be intimidating, but it’s important to understand that, generally, the less assumptions an insurer is making about your health and lifestyle choices, the more affordable and personalized-to-you the pricing will be.

If you’re shopping for coverage and worried about how your public records may impact your pricing or eligibility, reach out to our customer support team. They are happy to help you understand if it could either be an issue or slow down the approval process.

Finally, you can check with your state’s insurance department to find out your state’s laws on whether and how insurers can use your credit information in the underwriting process.

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Kimberly Rotter is an editor at Haven Life and a consumer credit and personal finance expert. She provides consumers with understandable, actionable information that can help them improve their financial and credit health.

Chelsea Brennan

About Chelsea Brennan

Chelsea Brennan is the founder of Smart Money Mamas, a personal finance blog that focuses on family finance, investing, and reducing money stress. Chelsea is an ex-hedge fund investor whose work has appeared in a wide array of publications, including Forbes, Business Insider, and more.

Read more by Chelsea Brennan

Our editorial policy

Haven Life is a customer-centric life insurance agency that’s backed and wholly owned by Massachusetts Mutual Life Insurance Company (MassMutual). We believe navigating decisions about life insurance, your personal finances and overall wellness can be refreshingly simple.

Our editorial policy

Haven Life is a customer centric life insurance agency that’s backed and wholly owned by Massachusetts Mutual Life Insurance Company (MassMutual). We believe navigating decisions about life insurance, your personal finances and overall wellness can be refreshingly simple.

Our content is created for educational purposes only. Haven Life does not endorse the companies, products, services or strategies discussed here, but we hope they can make your life a little less hard if they are a fit for your situation.

Haven Life is not authorized to give tax, legal or investment advice. This material is not intended to provide, and should not be relied on for tax, legal, or investment advice. Individuals are encouraged to seed advice from their own tax or legal counsel.

Our disclosures

Haven Term is a Term Life Insurance Policy (DTC and ICC17DTC in certain states, including NC) issued by Massachusetts Mutual Life Insurance Company (MassMutual), Springfield, MA 01111-0001 and offered exclusively through Haven Life Insurance Agency, LLC. In NY, Haven Term is DTC-NY 1017. In CA, Haven Term is DTC-CA 042017. Haven Term Simplified is a Simplified Issue Term Life Insurance Policy (ICC19PCM-SI 0819 in certain states, including NC) issued by the C.M. Life Insurance Company, Enfield, CT 06082. Policy and rider form numbers and features may vary by state and may not be available in all states. Our Agency license number in California is OK71922 and in Arkansas 100139527.

MassMutual is rated by A.M. Best Company as A++ (Superior; Top category of 15). The rating is as of Aril 1, 2020 and is subject to change. MassMutual has received different ratings from other rating agencies.

Haven Life Plus (Plus) is the marketing name for the Plus rider, which is included as part of the Haven Term policy and offers access to additional services and benefits at no cost or at a discount. The rider is not available in every state and is subject to change at any time. Neither Haven Life nor MassMutual are responsible for the provision of the benefits and services made accessible under the Plus Rider, which are provided by third party vendors (partners). For more information about Haven Life Plus, please visit: https://havenlife.com/plus.html

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