Auto insurance can be expensive if you have bad credit. Car insurance companies use credit as a major rating factor, setting prices based in part on clients' credit scores. Since auto insurance companies rely on data that show clients with low credit scores have a greater likelihood of filing car insurance claims, the companies compensate for this risk by charging more expensive rates.
Car insurance rates with bad credit depends on where you live, which insurance company you use, and a variety of other factors. See below typical insurance prices for drivers with bad credit in major New Mexico cities and rates from top auto insurance companies, plus a few tips on how to save on auto insurance with bad credit in New Mexico.
Drivers in New Mexico pay an average penalty of $920 annually for having a credit score at the low end of the scale. Drivers in either the “poor” or “below fair to poor” credit tier will also pay higher-than-average rates.
|Credit Tier||Average Annual Rate in New Mexico|
|Below Fair to Poor||$1,878|
|Average — All Credit Tiers||$1,331|
Car insurance rates also depend on the geographic area where you park your car. Insurance companies use your address to estimate your odds of filing a claim: the more claim-prone your area,, the more expensive rates you’ll pay.
Listed below are major New Mexico cities and their typical auto insurance rates for drivers with poor credit ratings.
|City||Average Annual Rate — Worst Credit||Average Annual Rate — Poor Credit||Average Annual Rate — Below Fair to Poor Credit|
Another factor contributing to how much you pay for auto insurance is the company you choose. Every auto insurance company rates policies differently, giving rating factors varying weights in their calculations. Credit can be a primary differentiator in price from one insurance company to the next. In New Mexico, the most affordable major insurance company with bad credit is USAA, which offers a discount of $348 per year versus the second-most affordable company, GEICO.
See below prices from popular car insurance companies in New Mexico for drivers with bad credit.
|Company||Average Annual Rate — Worst Credit Tier|
If you're dealing with the difficulty of buying auto insurance with a bad credit history, remember these tips: