Bankruptcy can impact your credit score and insurance companies use credit-based insurance scores to determine your insurance premiums. A bankruptcy can lower your credit score, which could lead to higher insurance rates. Providing the information helps the insurance company accurately access the risk associated with insuring your vehicle.
However, it's worth noting that the impact of bankruptcy on your insurance rates may vary depending on several factors, such as:
- The type of bankruptcy you file (Chapter 7 vs. Chapter 13)
- The insurance company's policies
- Your driving history
- The value of your vehicle
It's best to contact your insurance company directly to understand how bankruptcy will affect your insurance policy and premiums.
