When a person applies for a credit card or home mortgage, the lender will typically pull their credit report. This important record of debt and payment history is also accompanied by a three-digit credit score. Higher scores are a good sign the person has been responsible with their financial obligations while lower scores reveal the opposite. Pulling a credit report can cause a score to drop a few points. Some wonder if the inquiry also applies to insurance quotes. Here’s a helpful guide to clear up any confusion.

Do Insurance Quotes Hurt Your Credit Score?

The short answer is no. There are two types of credit report requests lenders do: hard pulls and soft pulls. A hard pull occurs when a person is filling out an application for a loan or credit card. To determine eligibility, interest rates, and potential approval, lenders will pull the applicant’s credit report to review their payment and debt history. In the case of a hard pull, the request may reduce a person’s credit score.

With a soft pull, a person is not trying to apply for a loan or credit card. Lenders initiate the request for pre-approved offers, such as credit cards and car loans. They’ve already looked at the person’s credit report and score and determined they are eligible for certain loans and credit cards. Another example of a soft pull is when an employer initiates one during a new employee background check. Insurance quotes also fall into the category of a soft pull because the person is not applying for a loan or credit.

How Do I Know Which One Was Requested?

Before you apply for any type of loan, credit card, or ask for insurance quotes, ask the lender or provider if they will do a soft or hard pull. They are obligated by law to tell you. Some will even provide detailed information on how much a hard pull will cause your credit score to drop. The key is to ask before the pull takes place.

David R Johnson Insurance in Beech Grove, IN is the premier State Farm® agent serving the Indianapolis area. He and his team of agents strongly believe in providing clear and upfront information. This includes free, no-obligation insurance quotes for homes, cars, and businesses. With more than 30 years of industry experience, David is 100% committed to securing customized and affordable coverage for all clients. Get your complimentary insurance quotes today by visiting the agency’s website or calling (317) 782-8858.