How Credit-Based Insurance Scores Work in Arkansas, and the Rights the Law Gives You
When an insurer says your rate is credit-based, it is easy to hear that they pulled your credit score and charged you for it. That is not quite what happens, and the difference decides what you can do about it. Arkansas has a whole statute on this, and most of it works in your favor.
What is a credit-based insurance score?
Arkansas law defines the score as a number or rating, produced by a model or similar process, that is based solely on credit information and used to predict an applicant’s or insured’s future insurance losses.
Built from credit information only
Credit information means credit-related information taken from a credit report. Information that is not credit-related does not count, even if it sits in a credit report or an application. Claims history, driving record, the vehicle and the home are rated separately, beside the score rather than inside it.
Not the same as your lending score
Both draw on the same credit file, but they are built for different purposes and may weigh credit factors differently. A strong lending score does not guarantee a strong insurance score, and the reverse is true too.
One factor among many
Insurers typically combine the score with claims history, driving record, property details, location, limits and deductibles. Arkansas law also expressly allows insurers to underwrite each risk on its own individual characteristics.
Personal insurance only
The Arkansas rules apply to personal insurance: private passenger auto, homeowners, motorcycles, mobile homes, non-commercial dwelling fire and farm policies, boats and personal watercraft, snowmobiles and recreational vehicles. Commercial insurance is outside the Act.
Why the definition matters
Every restriction in the Arkansas Use of Credit Information in Personal Insurance Act attaches to credit information and the score specifically. Knowing what is and is not inside the score tells you which protections apply to a given part of your premium.
What can and cannot go into an insurance score in Arkansas?
The left column lists credit report categories the FTC found scoring models typically use. The right column lists what Arkansas law bars from the score. A factor kept out of the score can still affect a premium some other way, such as location through rating territory.
| Typically drawn from your credit report | Barred from the score by Arkansas law |
|---|---|
| Payment history, including past delinquencies and public records such as bankruptcy | Income |
| Debt levels, such as how close balances are to credit limits | Gender |
| Length and age of your credit history | Address and ZIP code |
| New credit activity: inquiries and newly opened accounts | Ethnic group, religion and nationality |
| Use of certain types of credit, such as auto loans | Marital status |
Arkansas also says medical collection accounts cannot be treated as a negative factor. Insurers that use credit scores must file their scoring models with the Arkansas Insurance Department, along with loss experience that supports using credit at all.
Does shopping for insurance quotes hurt your insurance score in Arkansas?
No. Arkansas law lists inquiries that an insurer may not treat as a negative factor in any credit scoring method for personal insurance.
Insurance inquiries do not count against you
Inquiries relating to insurance coverage, when the credit report identifies them that way, cannot be used as a negative. Getting quotes from several companies, or from an independent agency that compares multiple insurance companies, is safe for the score.
Neither do inquiries you did not start, or checks on your own credit
Inquiries you did not initiate, and requests you make for your own credit information, are also off-limits as negatives.
Rate shopping for a mortgage or car loan counts once
Multiple lender inquiries coded as coming from the home mortgage industry, or from the automobile lending industry, and made within 30 days of each other, cannot be counted as negatives unless only one of them is considered. Families buying a home in Bentonville or a car in Rogers can shop lenders without each pull counting separately in an insurance score.
Opening new accounts is different
New credit activity is one of the categories scoring models read. A burst of new cards or loans is not the same as collecting insurance quotes, and the protection covers the quotes, not the new accounts.
What protections does Arkansas law give you?
Credit alone cannot be the reason an insurer declines, cancels or nonrenews a personal policy, and you have a right to a re-rate on current credit when you ask in writing.
Credit cannot stand alone
An insurer may not deny, cancel or nonrenew a personal policy based solely on credit information without considering another applicable underwriting factor independent of credit, and may not base a renewal rate solely on credit. It also may not take adverse action solely because you have no credit card account.
Thin or missing credit is not held against you
If there is little or no credit information, or no score can be calculated, the insurer must treat you as otherwise approved by the Insurance Commissioner, treat you as having neutral credit information, or leave credit out as a factor.
The data has to be current, and you can ask for a re-rate
Adverse action based on credit needs a report or score obtained within 90 days before the policy is written or renewed. Insurers must refresh credit information within 36 months, with some exceptions. On your written request, the insurer must re-underwrite and re-rate the policy on current credit, no more than once in any 12-month period.
Will you be told when credit is used, and what if your report is wrong?
Yes on both counts. Arkansas requires a notice at application, a specific explanation after an adverse action, and a re-rate when a dispute proves your report was wrong.
Notice at the application
If an insurer writing personal insurance uses credit information, it or its agent must tell you on the application, or when the application is taken, that it may obtain credit information. The notice is written or given in the same medium as the application, and need not be repeated at a renewal if you already received it.
Specific reasons after an adverse action
If credit information led to an adverse action, such as a higher premium or a declination, the insurer must give you the reasons in clear and specific language, up to four primary factors. Phrases like “poor credit history” are not enough. You must also be told which credit bureau supplied the report, that you can get a free copy and that you can dispute it.
A corrected report means a re-rate and any refund
If a dispute under the Fair Credit Reporting Act finds your credit information was incorrect or incomplete, the insurer must re-underwrite and re-rate you within 30 calendar days of written notice of the finding, and refund any overpaid premium.
Hard times that hurt your credit
Illness, job loss or a wider economic shock can damage credit without making a claim any more likely, a concern the NAIC notes regulators and consumer advocates have raised. Ask your insurer whether it will consider those circumstances.
How can you improve your credit-based insurance score?
The same habits that help any credit file help an insurance score, then a written request puts the improvement to work.
- Pay on time
Payment history and past delinquencies are among the categories scoring models read.
- Keep balances low against your limits
How close balances run to credit limits is read straight from the report.
- Let accounts age
Closing an old account can shorten the credit history a model sees.
- Open new credit only when you need it
New accounts are part of the new-credit data, unlike insurance quotes.
- Check your report and dispute errors
A corrected report triggers the 30-day re-rate and any refund described above.
- Ask in writing for a re-rate, and compare insurers
Once your credit improves, request a re-rate on current credit. Then compare, because insurers weigh credit differently. Our Arkansas insurance discounts guide lists other changes worth requesting.
What does full-coverage auto cost through Cribb?
Across auto policies placed through Cribb, full-coverage auto has averaged $79 to $105 a month.
Cribb’s agency average across policies we placed. Where credit moves a particular household inside or outside that range depends on one insurer’s filing, which is why comparing insurers matters.
The ranges shown here are an average of premium on policies Cribb Insurance Group Inc actually wrote, over the 18 months ending September 2026, across 2,500 policies. They describe what other people paid for their own coverage, not what you will pay. Exclusions, limits and conditions apply, and the insurance company sets your premium after its underwriting review.This is a planning range, not a quote, and not any insurer’s filed rate. Your premium depends on your drivers, vehicles, limits, deductibles, garaging address, claims history and, where the insurer uses it, a credit-based insurance score.
Find out what your insurer does with your credit.
Cribb Insurance Group is an independent agency in Bentonville serving Northwest Arkansas. Send us your declarations page and we will tell you whether your insurer uses credit information, when your rate was last based on current credit, whether a written re-rate request is worth making, and how the same household prices across multiple insurance companies. Insurance inquiries identified as such on your credit report do not count against your score.
Ask Cribby about insurance scores
Cribby is Cribb Insurance Group’s AI assistant for general insurance questions. Start with one of these, or ask your own. For your own policy, talk with our team.
Want to see what your current policy says? Upload your declarations page to Coverage Compare. It lays out your coverages, limits and deductibles, so when you compare insurers on credit you are comparing the same policy.
Use Coverage CompareCredit-based insurance score questions
Is my insurance score the same as my credit score?
No. A credit-based insurance score is a separate number built from credit report information to predict future insurance losses, while a lending score predicts whether a borrower repays. They draw on the same file and may weigh it differently, so the two can diverge. Arkansas defines the insurance score as based solely on credit information.
Are my claims and driving record part of my insurance score?
No, though insurers rate on them. Arkansas defines the score as based solely on credit information, and information that is not credit-related does not count as credit information even if it appears on a report. Claims history, driving record, the vehicle and the property sit beside the score as separate rating factors.
Does shopping for insurance hurt my score in Arkansas?
No. Arkansas bars insurers from treating insurance-related inquiries identified as such on your credit report, inquiries you did not initiate and checks on your own credit as negative factors. Multiple mortgage or auto loan inquiries within 30 days of each other cannot count as negatives unless only one is considered. You can compare insurers freely.
Does my income or ZIP code affect my insurance score?
Not the score itself. Ark. Code § 23-67-405 bars insurers from using a score calculated using income, gender, address, ZIP code, ethnic group, religion, marital status or nationality. Your location can still affect the premium through rating territory, which is a separate factor from the score.
Can an Arkansas insurer decline or nonrenew me just because of my credit?
No. An insurer may not deny, cancel or nonrenew a personal policy based solely on credit information without considering another underwriting factor independent of credit, and may not base a renewal rate solely on credit. It also may not take adverse action solely because you have no credit card account.
What if I have little or no credit history?
The insurer must treat you as otherwise approved by the Insurance Commissioner, treat you as having neutral credit information, or leave credit out as a factor. Arkansas law gives the insurer those three choices when there is little or no credit information, or when no score can be calculated.
How do I get re-rated after my credit improves?
Ask in writing. On a consumer’s written request, an insurer using credit information must re-underwrite and re-rate the policy on a current credit report or score, no more than once in any 12-month period. If a dispute shows your report was wrong, the insurer must re-rate within 30 days of written notice and refund any overpayment.
Sources we checked for this guide:
- Ark. Code § 23-67-404, definitions
- Ark. Code § 23-67-405, use of credit information
- Ark. Code § 23-67-406, dispute resolution and error correction
- Ark. Code § 23-67-407, initial notification
- Ark. Code § 23-67-408, adverse action notification
- FTC report to Congress: Credit-based insurance scores (2007)
- NAIC: Credit-based insurance scores
Insurance answers you can understand. From a local agency you can know.
We believe good insurance decisions start with clear information. Our Northwest Arkansas insurance guides explain coverage, pricing considerations and policy differences in everyday language, so you can shop with greater confidence.
Put your improved credit to work.
Send us your declarations page or start a quote. We will check how your current insurer uses credit, help you decide whether to request a written re-rate, and compare the same coverage across multiple insurance companies. Insurance inquiries identified as such on your credit report do not count against your score.
A quote is an estimate. It is not a guarantee of final premium, coverage or eligibility. The insurance company sets the actual rate and the actual coverage terms after its underwriting review, and they may differ from any figure shown here. Cribb Insurance Group Inc is an independent insurance agency, not an insurance company. Your insurance company issues the policy and pays covered claims. Coverage cannot be bound, changed or cancelled through this website, email, social media or voicemail, and is not in force until Cribb Insurance Group Inc or the insurance company confirms it in writing. Coverage, eligibility, discounts and prices vary by insurance company, policy and individual situation. Cribb Insurance Group Inc, 1601 SW Regional Airport Blvd, Bentonville, AR 72713, (479) 286-1066.