What If I Don't Have Any Credit?

WV & OH ONLY

"I've always paid cash and I don't really have a credit history. Can I still get car insurance in West Virginia or Ohio?"

Being careful with money and then hearing you have no credit is a strange spot.

Yes, you can still get car insurance with no credit history, because credit is only one of several things companies look at. West Virginia and Ohio each have rules for what a company does when there's no credit information to use. If your credit report is wrong instead of empty, those same states have rules for fixing your price and refunding what you overpaid.

Not every company sees it the way you do, and that bugs me. We'll work to get you the best rate possible anyway.

Companies have choices about how to handle someone with no credit file, so the answer changes from one to the next. We can check 13 companies and show you which ones treat it best.

Yes, this article is here to get you to call me. Paying cash your whole life shouldn't feel like a penalty. Let's find the company that sees it that way too.

WV & OH ONLY

Not even close. The Consumer Financial Protection Bureau estimated that in December 2020, 2.7 percent of U.S. adults, about 7 million people, had no credit record at all. Another 9.8 percent had a record but no score.

In my experience, it's often young drivers, people who've always paid cash, and widows or widowers whose accounts were all in a spouse's name.

They're different things. The Federal Trade Commission's 2007 report gives the two terms you might hear. A "no-hit" means a credit report couldn't be found for you. A "thin file" means there is a report, but not enough in it to calculate an insurance score.

The FTC found that people without scores looked only slightly riskier in its models once scores were taken into account. Think of that as one study, not a promise about what you'll pay.

Under Bulletin 20-12, if there's no credit information or not enough to produce an accurate score, a company has to do one of three things:

1. Treat you as neutral

2. Leave credit out and use its other underwriting criteria

3. Treat you another way the Commissioner has approved, if the company shows that missing credit relates to its risk

So neutral is on the list, but it isn't guaranteed. That's why two companies can answer this differently. Scoring also can't be the sole reason a company declines you.

Ohio's rule says that someone with no available credit history (a "no hit") or too little to score (a "no score") has to be underwritten and rated in accordance with actuarial principles and standards of practice. In plain English, the company needs a sound reason for how it treats you. The rule doesn't say neutral, and it doesn't say what your price will be.

Fix that first, or at least start. Here's the order, from the CFPB:

1. Dispute it with the credit reporting company. Explain in writing what's wrong and include copies of your proof.

2. Dispute it with the company that furnished the information, like a bank or card issuer.

3. If it looks like identity theft, report it at IdentityTheft.gov.

Under federal law, the reporting company generally has 30 days, sometimes up to 45, and it's free.

You can. Both states have nearly the same rule. Once a credit bureau determines the information was inaccurate or incomplete and your company gets notice of that, the company has 30 days to re-underwrite you, re-rate you and adjust the premium. If you overpaid, you get a refund going back up to 12 months, or less if you haven't had the coverage that long. In Ohio, the limit is 12 months or your current policy term, whichever is shorter.

Notice the catch: the company has to get notice. Don't assume the bureau told them. Send it yourself.

West Virginia also says a company can't use credit information that the bureau's records show is in dispute by you.

That's more of a banking question, and I'd only be guessing at what fits you. What I can tell you is you don't need to fix it before you call me. Even if a company has turned you down or dropped you, that's one company's answer.

No credit? Wrong credit? Either way, I can tell you who'll write you and what it costs.

WV & OH ONLY

Next in the series: Part 16, Will My Insurance Go Up If Someone Else Hits Me?