A Social Security number (SSN) is a nine-digit number assigned to American citizens by the Social Security Administration. Giving your Social Security Number to the wrong person could result in identity theft – and with it, many headaches.
However, there are times when giving out your SSN might be necessary, such as when you’re applying for a loan, getting a driver’s license, applying for utility services and getting a quote for car insurance.
Here’s what you need to know about auto insurance companies and your Social Security Number.
Do insurance companies need your Social Security Number?
Not all car insurance companies ask you for your Social Security number (SSN) as part of the quoting or application process, but many will, especially if they use credit-based insurance rates.
CarInsurance.com partners with car insurance companies that check credit-based insurance scores as a factor in your insurance rate. However, in some states, carriers are restricted from using credit information in their calculations.
States that limit how your car insurance companies can use your credit score to determine rates include:
Why do car insurance companies need your Social Security Number?
Your Social Security Number doesn’t have much to do with your driving record, but it does help an insurer determine some important information about you.
For example, a Social Security Number often is required because it makes it easier to pull reports that verify the information you have provided during the quoting process. This is an important step in finalizing the premium amount you will pay.
While auto insurance companies can use your name and home address to pull your motor vehicle record, they are likely to get a higher level of accuracy if they also use your SSN.
Obtaining your Social Security Number allows the insurance company to run a credit check. Credit history has been shown to offer information that is a good predictor of the likelihood that someone will file an insurance claim.
Many auto insurance companies use insurance scores based on your credit report. If your credit is not verifiable, you might pay a higher car insurance rate. The carriers that don’t require a Social Security Number will use your address and name to calculate an insurance score.
Do I have to provide my Social Security Number to buy car insurance?
You can refuse to give your Social Security Number to a prospective car insurance company, but that can backfire in the form of higher insurance rates.
If the car insurance provider uses credit-based insurance rates and the company cannot look at your credit report due to a lack of SSN information, the insurer may either decline to sell you a policy or offer coverage at a higher rate. The same is true if they can’t pull your motor vehicle record.
Insurance rates are all about risk assessment, and not having vital information inhibits the insurance company from accurately assessing the risk you pose as a driver.
As a result, the insurer typically will err on the side of caution and consider you high risk, which will result in higher insurance rates. If you are looking for the best car insurance rates, provide your SSN.
Frequently Asked Questions: Social Security Numbers and car insurance
Why would an insurance adjuster ask for my Social Security Number?
It is common for an insurance adjuster to ask for a Social Security Number as a security measure to ensure they are speaking with the right person. Adjusters also might use a SSN to check the insurer’s database for prior claims.
Is it safe to give an auto insurance company my Social Security Number?
To keep your Social Security Number safe, deal only with reputable insurance companies. If you have not requested an insurance quote and someone contacts you — via phone, email or text — and requests your SSN, do not provide the number.
What if I do not have a Social Security number?
If you need to get a SSN, contact the Social Security Administration.