1)      Planning Ahead:  Small business owners who managed to grow in the face of economic weakness were adept at planning for what might go wrong, rather than simply reacting to trouble. When times were good, these well-prepared biz owners squirreled away cash reserves and opened credit lines that helped them weather tough times without having to make cutbacks.  In contrast, owners with declining revenues found themselves madly rushing to slash expenses as difficulties mounted.

2)      Borrowing Strategically:  Growing businesses understand that borrowing can be a good thing (especially since interest is tax deductible) if the money is put to good business use.  And the use that has paid off best for growth firms is R&D. About 58% of high-growth small business owners report that R&D type investments yielded the most positive returns. On the other hand, borrowing to open new offices, build production facilities or add new capabilities was more likely to correlate with a DROP than an increase in sales. Likewise, borrowing to add staff was generally a money-losing endeavor.

3)      Sharpening Management Skills: Professional development also leads to more income. Business owners who improved their skills at strategic planning and money management, for example, had a better chance of achieving revenue growth than those who didn’t.  But the most compelling results came from those who got better at hiring the right people. Team building skills, it turns out, are great for boosting a bottom line.

4)      Getting Good Advice:  Small biz owners have always relied on advice from friends and fellow business owners. That never changes.  But the best of them also make sure they plug into a savvy accountant or other financial advisors to provide the kind of professional fiscal advice that every business needs, no matter what size.  For example, 68% of businesses with rising revenues sought out financial advisors, while only 51% of those with declining revenues took that step.  

5)      Balancing Business and Life: Revenue-boosting business owners tend not to be all-consumed by their businesses.  They’ve learned to balance involvement with family, friends and their communities.  In short, they run their businesses – not the other way around.  Conversely, business owners whose revenues decline tended to be more fiercely independent and obsessed with their companies at the expense of other parts of their lives.

6)      Sharing Vision:  The Guardian study also found a strong correlation between success (in terms of revenue growth) and business owners who were strong leaders and adept at sharing their vision with employees, colleagues and others.  In addition, it was critical for business owners to demonstrate commitment to the business and inspire teams to perform at their highest level.

If you’re not among the ranks of revenue risers, take these six differentiators to heart as you plan your year ahead. By following in the footsteps of success, you’ll have a better chance of increasing revenues no matter what’s happening in the economy around you.

Copyright © 2000-2012 BizBest® Media Corp.  All Rights Reserved.

1.      Daily deals dive: The daily deal space exploded last year, but 2012 will see deal shrinkage of 30% or more. Rapid contraction will leave just a couple of “big guys,” some vertically positioned players and a long tail of locals finding ways to thrive by serving a few small regions or cities.

2.  Surviving deals get a makeover:  Burned by go-for-broke deals, many local businesses will fine tune and target their offers to strengthen loyalty. The more geographically concentrated your customer-base is, the better your chances of turning deal-seekers into repeat buyers. Look for an increase in frequent buyer and perk programs to support this movement in 2012.

3.   Small businesses move to the cloud. The ability to self-publish quickly via the cloud is moving businesses out of traditional media.  Productivity services such as Google Docs, Zoho Creator, Office 365 (from Microsoft) and many others are making it easier than ever to operate entirely online.  Low cost tablet computers will let more service professionals and small business owners run their businesses from a mobile device. 

4.      Breakthrough tools arrive. Emerging technology will spawn more break-through productivity tools.  Business owners will see new, off-the-shelf ways to connect with consumers.  With the launch of Siri, Apple’s new voice-activated personal assistant application, developers will be hard at work on amazing voice-activated apps that will offer a unique way for local businesses to stand out.

5.      The “Digital Coupon Book” takes off:  The move to more online shopping turns passive discount recipients into active coupon seekers.  Digital “coupon books” will dominate within the next two years, offering small businesses another way to leverage existing customer relationships with hyper-local offers.  We’ll see a growth in local offer networks, personalized consumer dashboards and highly targeted deals.

6.      The appointment book disappears.  The success of sites such as Schedulicity, OpenTable and ZocDoc reinforce the idea that the traditional pen and paper appointment book may soon disappear.  The number of appointments booked online is soaring.  Schedulicity alone has seen nearly 7 million appointments booked online since mid-2009. 

7.      Mobile commerce soars.  Mobile payment, location-based promotions, and mobile scheduling will all change the way small business owners conduct business in 2012.  Whether iPad or iPhone, Kindle Fire or Droid, the move to mobile will continue apace.  Making your business website mobile-friendly is only a start.  As more and more consumers are making mobile a mainstay, it will be essential for small businesses to have a mobile commerce strategy to tap into this opportunity.

8.      Thinking “local” gains steam.  With a still-shaky economy and unbending unemployment rates, 2012 is poised to be trying for small business.  Small business owners need to think local – the headlines in the local newspaper and the vibe on Main Street are more important than what’s being talked about on CNBC.

9.      Social media gets marketing money.  Social media marketing isn’t just for early adopters anymore.  Big brands and Fortune 500 companies have spent the past three years discovering (and utilizing) the marketing capabilities of Facebook, Twitter, and other online tools.  In 2012, more small businesses will expand online and embrace Facebook as the dominant social media marketing tool for local business.

10.  The client continues to be king.  Small business and independent service professionals are no longer “too busy for new clients.”  Taking advantage of networking opportunities and exploring new online listing options will help small businesses make themselves known and available to new clients. 

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According to Joseph Wells, a CPA and founder of the Association of Certified Fraud Examiners, these three major risk factors can lead to fraud in a small business:

1)    Inadequate screening of employees before they are hired. Doing background checks is advised.

2)    Inadequate financial controls around record-keeping, bank accounts and how cash is handled.

3)    Too much trust. Sadly, the very thing that makes a small business a nice place to work also helps thieves succeed.

Some common back office fraud schemes include billing for non-existent goods or services, creating fake vendors, writing checks to dummy businesses or taking kickbacks from vendors.

A recent survey of small business owners by TD Bank, one of America’s 10 largest financial institutions, found that 75 percent are taking at least some steps to protect themselves against financial fraud.  But most aren’t doing nearly enough.

“It pays to be vigilant,” says Robert Dunlop, who heads corporate security and investigations for TD Bank. “Given the influx of new technologies available to small business owners, it’s important to learn about the latest techniques used by criminals, and to be more diligent in defending against fraud.”

Here are some tips for protecting your business against financial fraud:

Employ financial checks and balances.  Perform an internal review of company finances monthly. Make sure payment amounts match all invoices, and check for missing documents.  Running random audits or having a third party audit the books yearly shows employees that you are serious about fraud and deters would-be thieves.

Protect computer systems and practice web awareness.  Being complacent about cyber protection has cost many small companies dearly.  Every computer should have the latest firewalls and anti-virus software. Beware of “phishing” schemes that try to obtain confidential information from you or your employees. These usually take the form of an email that appears to be from a financial institution or service provider, but is fraudulent.  While most are easy to spot, some contain enticing headlines or appear to come from a legitimate address.

Guard sensitive hard copy documents, too.  The digital realm isn’t the only place your information is at risk.  Employees and others can steal your mail, credit card information or checks.  Printed financial statements and other sensitive papers should be shredded or stored securely.  Most financial institutions now let you opt out of receiving paper statements entirely, so that’s something to consider.

Even innocent photocopiers pose risk. “Most copiers built since 2002 contain a hard drive that stores every image scanned, copied or emailed. When you sell or upgrade your copier, the machine is usually reconditioned, but often the hard drive is left intact,” says Dunlop. Once the machine is resold, anyone can simply pop out the hard drive and access confidential information such as income tax and bank records, social security numbers, and medical records.

Use secure online banking.  Online banking is a secure way to manage small business finances. Most major banks now provide numerous levels of online security. Benefits include 24/7 access to real-time information, account transfers and payment management. You can easily schedule and manage payments and will have an audit trail of all transactions.  Be sure to check account activity regularly. Having instant access to payment histories helps you monitor spending for any discrepancies.  

Get proper insurance. Crime and fraud-related losses generally aren’t covered by property insurance policies, so it’s important to protect money losses from workplace fraud.  “Fidelity Insurance” protects your business against criminal acts such as robbery, embezzlement, forgery and credit card fraud. Liabilities secured under this type of insurance usually include money loss coverage (burglary or theft) and employee dishonesty (embezzlement and forgery).

Copyright © 2000-2011 BizBest® Media Corp.  All Rights Reserved.

I agree – it’s not a sexy topic like social media.  But if you ever seek bank financing, angel investors, venture capital or a loan from friends and family, these are things you need to know.

Your balance sheet shows what your business owns and what it owes at a fixed point in time, and provides details about your assets, liabilities and owners’ equity. It does not show money that flows in and out of the accounts during that period (we’ll get to that shortly).

• Assets are things your business owns that have value and could be sold, including tangible assets such as vehicles, equipment, inventory and cash, plus intellectual assets such as trademarks and patents.
• Liabilities are amounts your business owes to others, including loans, rent, vendor accounts, payroll and taxes, as well as obligations to provide goods or services to customers in the future.
• Owners’ (or shareholders’) equity is your capital or net worth. It’s the amount that would be left if the business sold all assets and paid off all liabilities. This leftover money belongs to the owners.

An income statement shows revenues over a specific time period – i.e. a month, quarter or year – and shows what you spent to generate that revenue. The literal “bottom line” of an income statement shows what the business earned or lost over that period.

Think of an income statement as a stairway. You start at the top with total sales, and then go down one step at a time. At each step, you make a deduction for costs or other operating expenses that were necessary to earn the revenue. At the bottom of the stairs, after deducting all of the expenses, you learn how much the business earned or lost.  

A Cash flow statement shows inflows and outflows of cash over a fixed period. This is critical because any business needs cash to cover ongoing costs. While an income statement (above) shows profit or loss, a cash flow statement merely indicates if the business generated cash. You should also know that a cash flow statement shows changes over time, not absolute dollar amounts at a given point. The bottom line of the cash flow statement shows how much it went up or down for the period. Generally, cash flow statements review the cash flow from three key activities: operating, investing (back into the business) and financing.

4 Key Terms and Ratios to Know

Here’s a mini glossary of four key financial statement terms and ratios you’ll also want to know:

• The Debt-to-equity ratio compares total debt to owners’ equity. Both numbers come from your balance sheet. To calculate a debt-to-equity ratio, divide total liabilities by owners’ equity. If a business has a debt-to-equity ratio of 2-to-1, for example, it means that it is taking on debt at twice the rate that its owners are investing in the company.
• Inventory turnover ratio compares a company’s cost of sales on its income statement with its average inventory balance for the period. To calculate this ratio, divide cost of sales by average inventory for the period. A 2-to-1 ratio means the company’s inventory turned over twice in the reporting period.
• Operating margin shows percentage of profit for each dollar of sales. It compares operating income to net revenues. Both numbers come from the income statement. To calculate operating margin, divide income from operations (before interest and income tax expenses) by net revenues. Operating margin is usually expressed as a percentage.
• Working capital is the money leftover if the business paid its current liabilities (debts due within one-year) out of its current assets.

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1)      If your employees earn tips, the IRS has you in its sights (again). The tax agency has launched a new effort to bill employers for Social Security (FICA) and Medicare taxes on tip income reported by employees to the IRS, but not to you.  The genesis of this is an IRS form you probably never heard of:  Form 4137: Social Security and Medicare Tax on Unreported Tip Income.  This is how tip-earning employees tell the IRS about tips they earned but did not report to an employer – including any “unallocated” tips shown on their W-2. And the threshold is low:  Any employee who received cash and charge tips of $20 or more in calendar month and didn’t report that income to you (the employer) must file a 4137. In past years, the IRS didn’t have an easy way to match that income to an employer.  But the form was changed and now requires the employee to include your tax ID number. This, of course, creates a new tax event for you (never mind you didn’t know about it), since you are responsible for paying the employer portion of FICA and Medicare taxes on this income.   IRS is collecting the information from the new 4137 forms it receives, and is sending tax bills or letters to employers telling them how much they owe.  Employers who pay up quickly – usually with the next scheduled payroll tax deposit – are not charged any penalty or interest.

2)      S-Corp business owners who pay themselves extremely low salaries in order to take more profits as lower-taxed dividends are also in the IRS crosshairs these days.  Be aware the IRS might argue that your pay is unreasonably low if it doesn’t come close to standards in your business or profession, and will seek back taxes on the income that it says should have been classified as salary.

3)      And here’s a reason to question the health insurance tax credit for small business that’s received such great fanfare since passage of health insurance form:  If you receive such a credit, it will also count against you by reducing the amount your small business can deduct for health insurance premiums.  Be sure to factor this in when calculating the value of the credit toward purchasing health insurance for your employees.

4)      And finally the good news:  Thanks to 2011 100% bonus depreciation, if your business buys a new heavy (gross vehicle weight over 6,000 pounds) SUV this year, you’ll qualify for a much larger tax break than before.  As long as the SUV is used 100 percent for business purposes, your company can write off the entire cost immediately under the bonus depreciation rule now in place.  Forget the old $25,000 maximum you may have seen as a lid on the amount of an SUV purchase that can be expensed. That doesn’t apply under 2011 bonus depreciation rules.  Both new and used heavy pickup trucks also qualify for full write-off.

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Web-based P2P lending is booming.  Consider it the democratization of the lending industry — average Americans making loans to each other in a controlled marketplace made possible by the evolution of several websites created to facilitate P2P lending.

One such site, Prosper.com, has a membership base of over a million individuals, including both those who lend and those who borrow, and has funded over $230 million in loans.  The system works like an auction where credit-worthy borrowers post a loan request or “listing,” and would-be lenders bid for the business. So if you have a good-looking credit history, want to borrow $10,000 and are willing to pay, say, 10 percent interest, you could end up with a loan at a lower rate as lenders compete for your business.

As a borrower, you set the amount of want and the rate you want to pay and wait for lenders to step up.  And it works. Much like eBay spawned an army of small e-Bay businesses, P2P sites are attracting small investors who see it as a way to earn a higher return on their money. 

P2P sites have created a turnkey structure to facilitate the loan process. In addition to matching peer borrowers with peer lenders, the process provides all of the loan documents and payment systems to make the loan happen.

In addition to criteria commonly used by banks, such as credit scores and histories, Prosper lenders, for example, can consider borrowers’ personal stories, endorsements from friends and group affiliations. Once the auction ends, Prosper takes the bids with the lowest rates and combines them to facilitate the funding of one simple loan to the borrower, and then issues what are called “Notes” to all the winning bidders. Prosper handles all on-going loan administration tasks including loan repayment and collections on behalf of the matched borrowers and investors. Prosper members can also trade Notes with other members on the Folio Investing Note Trader platform. 

Another leading P2P site is LendingClub.com, which works similarly to Prosper.com. RaiseCapital.com specifically targets small business loans and connecting entrepreneurs to potential investors.    

Beware of “me-to” sites that attempt to jump on the P2P bandwagon but might not have the member base or resources to stay in business. A site called Pertuity Direct, for example, came and went quickly as its investors pulled the plug. Because P2P lending sites have to meet state government lending rules (as well as federal SEC requirements), they aren’t operating in all 50 states. Check their web sites for a list of areas they operate.

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In a nutshell, the new system takes more small business credit decisions out of human hands and turns them over to computers armed with vast quantities of data never before used for this purpose.  The new business risk assessment scores allow banks and other businesses to go well beyond traditional industry reports when deciding whether to approve a small business loan or not.    

BizBest inquiries have found that banks and other lenders aren’t satisfied with how small business credit scores are currently compiled and have been quietly working  with Equifax to develop a new, automated “early warning” scoring method that uses more data on each small business and new techniques to “predict” future changes of default.  Small business lenders themselves, through an industry association they’ve created called the Small Business Financial Exchange, are supplying new types of data that hasn’t been part of past scoring efforts.

According to Equifax documents, the new small business credit risk scores differ in four key ways from prior scoring systems:

1. The new approach uses several different automated scoring systems that are built on pre-recession, recession and post-recession data. They represent a new type of business scoring that provides a more complete view of how a company meets its credit obligations during changing economic conditions.
2. The new scoring system incorporates twice as many data attributes as other industry scores, including large and small business, public and private organization and time series variables.
3. A new minimum scoring standard and threshold will be used to validate the legitimacy of a small business and verify information supplied on the credit application errors, omissions or inconsistencies.
4. The new small business credit “scorecards” will be applied automatically based on business size. This is basically meant to encourage banks, lenders and other creditors to skip using other scoring systems and stick with this one alone. 

This is not an experiment, trial or proposal. The new scoring methods are already in play. Specifically, Equifax is providing the following to lenders:

• The Business Delinquency Score, which predicts the likelihood of severe delinquency on an account, and;
• The Business Delinquency Financial Score, which determines the likelihood of severe delinquency on financial accounts.
• A next-generation Business Failure Score, which incorporates many of the same data elements as the delinquency scores – enhancing its ability to predict the likelihood of business failure within the next 12 months.

And here’s something else business owners should know:  Both of these new credit scoring products give lenders the additional choice of obtaining credit information on the business owner and other officers and principals, along with credit information on the business itself.  Equifax says it plans to introduce other scoring changes and enhancements throughout the year.

The inability of banks and other lenders to anticipate how a small business might fare under changing economic conditions in the future has been a driving force behind the new scoring system.  Burned by defaults in the “Great Recession,” creditors are seeking a new crystal ball to help them tag businesses that – although faring well now – might stumble if marketing conditions change.

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Once you’ve established a track record, you can seek to expand the credit line in small steps.  Many major banks that serve small business offer unsecured business credit lines of $5,000 to $100,000 for firms that have been around at least 2 years.  These include well known commercial banks such as – including Bank of America, Wells Fargo, US Bank, Chase and Key Bank, as well as community banks, credit unions, online banks and some you might not have thought of such as American Express Bank, Capital One Bank, Discover Bank and Advanta Bank.

A business credit line is a flexible financial tool that can help a small business grow and keep you in control.  So even if you don’t have an immediate need for a credit line, it’s handy to have in your hip pocket if business conditions change.  Establishing the revolving credit line is cheap, you only pay interest on what you borrow and you can use the line for almost anything.  

Here are six things a small business line of credit can be used for:

1. Remodel, expand or upgrade your store, offices or other facilities.
2. Buy new computers, servers, office technology or other equipment.
3. Purchase extra inventory for upcoming promotions or seasonal spikes.
4. Launch a new online marketing campaign.
5. Create a new product prototype, pursue a promising business opportunity.
6. Cover unexpected expenses.

Banks are still a good place to look for credit lines.  Sure, bankers are being more tight-fisted these days, but they do have money to lend – especially for established businesses – and credit lines are one way they are doing it. Wells Fargo, for example, offers small business credit lines up to $100,000 that you can apply for online, even if you’re not a current customer.

Credit lines are also appealing because of their low costs.  Interest rates will vary with prevailing market rates, but many lenders allow you to tap the line – via paper check writing, online, check card or other method – for no fee.  However, you can expect to pay a modest fee to open the account once you’ve been approved. Wells Fargo, for example, charges $150 for lines under $25,000 and $250 for larger lines.  Any annual fee is often waived for the first year, and may run $100-$150 annually thereafter.

You should also ask if the lender offers some kind of interest rate protection or lock-in feature to protect you against rising rates in the future.  Some lenders will let you lock in an interest rate on your business line of credit for a year.    

Beware of using a credit line for cash advances however, as many banks charge a cash advance fee that can run 3% or more.

How to apply for a Business line of Credit

To obtain a credit line, you will probably need to supply some financial information about your business as well as yourself, so be prepared with income and other statements or tax returns.  Sources of small business credit lines are numerous. To find the perfect fit and absolute best terms, you should plan to comparison shop among several lenders.

Some banks also offer unsecured revolving lines of credit backed by the U.S. Small Business Administration (SBA).   This SBA’s CAPLines program helps business owners meet short-term and working capital needs and can be a great option for newer businesses less than four years old.  Choices include these five different types of credit lines:

1. Seasonal Line.  Loan proceeds can only be used to finance seasonal increases of accounts receivable and inventory (or in some cases associated increased labor costs), but can be revolving or non-revolving.
2. Contract Line. This line finances the direct labor and material cost associated with performing an assignable contract and can be revolving or non-revolving.
3. Builders Line.  If you are a small general contractor or builder constructing or renovating commercial or residential buildings, this can finance direct labor and material costs. The building project serves as the collateral and loans can be revolving or non-revolving.
4. Standard Asset-Based Line. This is an asset-based revolving line of credit for businesses unable to meet credit standards associated with long-term credit. It provides financing for cyclical growth, recurring and/or short-term needs. Repayment comes from converting short-term assets into cash, which is used to pay back the lender. Your business can continually draw from this line of credit, based on existing assets. This line is generally used by businesses that provide credit to other businesses.
5. Small Asset-Based Line. This is an asset-based revolving line of credit of up to $200,000. It operates like a standard asset-based line except that some of the stricter servicing requirements are waived, as long as your business can show repayment ability from cash flow for the full amount.

 Credit Line Tips and Warnings

• Avoid carrying a constant balance on your credit line. Periodically paying down the debt completely will keep the credit in place and your lender happy.
• One key factor in obtaining a credit line will be your business cash flow.
• If your small business doesn’t quality for a standard credit line, ask for an “asset-based” line.
• Remember, the best time to set up a small business line of credit is before your business actually needs it.

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The so-called Section 179 deduction limit, slated to revert to $25,000, was increased to $500,000, and the total amount of equipment that can be purchased was increased to $2 million (up from $200,000). This includes most new and used capital equipment, and also includes software.  In addition, bonus depreciation was increased to 100 percent on qualified assets (new equipment only). When applying these provisions, Section 179 is generally taken first, followed by bonus depreciation. 

Bonus depreciation, a special depreciation allowance, is a limited-time tax benefit for business purchases of qualified items during 2011, or in some cases 2012 as well.  Basically, bonus depreciation offers a giant tax incentive for businesses to buy new property and other assets now by allowing you to write off (or “expense” in accounting lingo) the entire purchase (100 percent) immediately rather than having to take those write-offs in little pieces over many years (called depreciation). Normally, businesses recover these types of capital investments through annual deductions spread over as many as 20 years. 

Now 100%:  This provision of the Tax Relief Act passed late last year doubles the amount of bonus depreciation allowed – from half of the purchase cost, to the full amount (100 percent) for this year. That’s up from 30 percent a few years ago. In other words, if you buy some PCs, servers, phone equipment, machinery, or all kinds of other qualifying items, you can take the entire amount as a deduction on your 2011 tax return.   

The temporary rule change also makes 50 percent bonus depreciation available for qualified property placed in service during 2012. Some long-lived property and transportation property is eligible for 100 percent expensing if placed in service by the end of 2012. What’s more, there is no cap on the amount you can spend and deduct, and the benefit applies to businesses of any size.

Where Section 179 Fits:  Other benefits available only to small businesses fall under different provisions known as the Section 179 rules.   The maximum amount of property that small businesses could deduct immediately under Section 179 was scheduled to revert to its old limit of $25,000, but that’s now been raised to $500,000. This includes vehicles, machinery, furniture and other equipment.  A detailed list of qualifying types of property is available at IRS.gov.

To qualify for the Section 179 deduction, your property must have been acquired for use in your trade or business. Property you acquire only to produce income, such as investment property, rental property (if renting property is not your trade or business), and property that produces royalties, does not qualify.

When you use property for both business and non-business purposes, you can take the Section 179 deduction if you use the property more than 50 percent for business.  If you use it more than 50 percent for business, multiply the cost of the property by the percentage of business use. Use the resulting business cost to figure your Section 179 deduction.

When to Forego the Bonus: The IRS also ruled recently that you can forego bonus depreciation if you want to.  That’s something you might want to consider if your business has an expiring net operating loss, an expiring capital loss carryover, or you believe that much higher tax rates in the future will make deductions more valuable in later years.

The website Section179.org is a helpful resource for figuring out Section 179 deductions, and covers the details in plain language, including what property qualifies and the many ways that the deduction can impact your bottom line. The site also has IRS tax forms, and tools for you to use, including a free Section 179 deduction calculator.

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Credit scores and insurance scores are not the same thing.  Not knowing the difference can cost you and your business money.  Both are derived from the same data, but are intended to predict different things.  Credit-risk scores aim to predict the likelihood you’ll default on a loan or other credit.  Insurance scores, however, are built to predict whether you are likely to file more (or less) claims with the insurance company than the average customer.

More and more insurance companies are now using credit-based scoring to screen customers and set rates.  All of the 15 largest auto insurance companies in the U.S. now use it. Even if your business has a good claims history, you could end up paying higher rates – or could be turned down for coverage elsewhere – if the insurance company doesn’t like what it sees in your credit file. 

For business owners with good credit, however, credit-based insurance scoring can be good news.  “Good credit can also reduce insurance premiums, since many insurers offer good credit discounts,” says Loretta Worters, vice president of the Insurance Information Institute.  A study in Oregon, for example, showed that auto insurance policyholders with a good credit-based insurance score paid as much as 48 percent less for coverage.   

Ask your insurance company or agent if you are getting the best rate and terms available. If you aren’t, find out why: It could be due to a poor insurance score.  If you are denied coverage or offered a higher rate, consider reapplying after your credit picture improves. The simple step of paying all your bills on time is your best defense against trouble caused by a low credit-based insurance score.  Find out more about insurance scoring.

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