Most car insurers consider those with poor credit ratings to be higher risk, and raise rates accordingly. Why? If your credit rating isn't great, you've probably missed a few credit card or mortgage payments, or perhaps written some bad checks. That means you're a less reliable insurance customer, as you may neglect to pay them at some point [source: Roberts-Grey].
However, the practice of looking at credit ratings to determine insurance premiums is a bit controversial. There's not a rock-solid link between credit scores and timely bill payments [source: Dykman]. Plus, insurance companies often neglect to inform their customers that credit ratings are a factor in setting their premium rates. If this is a concern for you, ask your agent whether the company looks at credit scores. If they do -- or if the agent hedges -- go elsewhere.