Insurers told to stop using credit scores to set rates
OLYMPIA — Insurers must stop using credit scores to set rates for home, auto and renter’s insurance policies under an emergency rule issued Tuesday by Insurance Commissioner Mike Kreidler.
The rule would keep the prohibition in force until three years after the state of emergency for the coronavirus pandemic is declared over, by the president or the governor — whichever is later.
Kreidler, a Democrat, has long argued that use of credit scores is discriminatory and results in people with low incomes and people of color paying more for coverage. With federal law preventing the reporting of certain negative credit information during the pandemic, he’s concerned inaccurate credit histories and unreliable credit scores are getting generated for consumers.
“I’m taking action because I recognize the great potential for harm from the unreliable use of credit reporting by the insurance industry,” Kreidler said in a statement. “The federal emergency declaration related to the pandemic will eventually end and leave many consumers vulnerable to harmful data used by insurers.”
https://www.heraldnet.com/news/insurers-told-to-stop-using-credit-scores-to-set-rates/