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Mike Kreidler
Washington Insurance
Commissioner
News Release
For More Information, Contact:
Public Affairs: (360) 725-7055
Office of Insurance Commissioner
Web Page:
www.insurance.wa.gov
12/9/2004
Rule proposed to amend credit scoring regulation
Tumwater, Wash. — An amended credit scoring rule that would provide more
consumer protection will be given a public hearing in Olympia next week.
Under the amended rule, any insurer that denies someone coverage or
bases a consumer’s premium on their credit history must explain why
their credit history affected their insurance score.
PUBLIC RULE HEARING Time: 9:00 a.m. Date: Thursday, December 16 Place:
John L. O’Brien Building House Hearing Room C, 504 15th Avenue SW
Olympia, WA 98504
“Simply telling consumers they have an unfavorable number of revolving
credit accounts does not provide them with enough information,” said
Insurance Commissioner Mike Kreidler. “Consumers need to know what is
specifically causing the problem.”
Insurers no longer will be able to use the term “unfavorable” to
describe an attribute of a consumer’s credit history. Instead, they must
tell the consumer why his or her credit history affected their ability
to get insurance or to get the lowest price. Along with the reason for
the adverse action, the amended rule orders insurers to tell consumers:
• What item in their credit history adversely affected their insurance
score • How the item in their credit history affected the insurance
score • What the consumer can do to improve this attribute of their
score
If an insurer uses insurance industry research or studies to justify the
effect insurance scores have on premiums or eligibility for coverage,
the insurer must file the cited study or information with the Office of
the Insurance Commissioner so they are available for public disclosure.
“This rule ensures consumers will be provided with the best information
available to make credit decisions that can produce a better insurance
score and possibly, a lower premium,” said Kreidler.
The proposed rule is scheduled for adoption after December 27, 2004, and
will take effect 31 days from the adoption date.
Editor’s note: Washington consumers have the right to one free copy of
their credit report per year under a recent amendment to the Fair Credit
Reporting Act. To order a free copy, visit
www.annualcreditreport.com or call 1-877-322-8228. |