Does filing bankruptcy lower my chances of getting insurance?

Many people in Coppell, Texas wonder if filing bankruptcy will affect their ability to purchase insurance. While there is some reason to be concerned, in practical terms, you can still get insurance in Texas after filing for bankruptcy.

Over the past four or five years, DFW, Coppell and many other parts of the state were impacted by the weak economy. Although the state of Texas had a lower unemployment rate and a stronger overall economy than the nation as a whole, there was still a significant percentage of people living in DFW, Coppell and all parts of Texas that fell on hard times and had to file for bankruptcy.

When you file for a Chapter 7 bankruptcy and have all of your debts discharged, you are actually in a much better financial position than if you were behind or in default on payments to your creditors. As your independent insurance agent, here in Coppell, we can help you find affordable insurance even if you have filed for bankruptcy.

While you may have a more difficult time securing the most favorable rates, there are many insurance companies that are more than happy to work with people who have taken a misstep in their financial lives. In Texas, an insurance company can not discriminate against people with bad credit or people who have filed for bankruptcy. They can, however, charge higher premiums and also ask for more of a down payment when you take out a policy.

Insurers issue policies based on risk. One of the factors that they consider when evaluating risk is financial stability. People with bankruptcies on their record are considered to be in a higher risk group than people with perfect credit. Although a bankruptcy can affect your rates, if you are a safe driver and do not have any traffic violations, you should have no trouble finding insurance at a reasonable rate.

If bankruptcy forces you to initially pay a higher premium, as time goes by, your rates will come down, especially if you stick with the same insurance company that wrote your original policy.