NAMIC Publishes State Laws and Legislative Trends Report

The National Association of Insurance Companies (NAMIC) has published a State Laws and Legislative Trends report on the “Use of Credit History by Insurance Companies.”

The NAMIC analysis shows:

Prior to 2002, no states have strictly prohibited insurance companies from using credit information as a tool in the underwriting or rate making process.

20 states have no statutory or regulatory provision to address the practice.

30 states have adopted rules that simply regulate or restrict the use of credit history.

More than 60 related bills have been introduced in 26 states so far this year.

“Credit histories are one of many important tools for insurance companies and how the law permits them to be used is critical to understand,” according to NAMIC’s Regulatory Affairs Vice president Roger Schmelzer, who noted that Maryland is expected to soon join Idaho, Utah and Washington as the fourth state in 2002 to pass a new law governing the use of credit histories by insurance companies.

“We are happy to provide this legislative information free of charge so that insurers can not only be up to date, but to allow for the opportunity to impact the substance of the proposals if they wish,” Schmelzer said.

Legislation is still officially pending in 18 states. NAMIC will provide updates on the progress of these bills. In that legislative attention is not apt to subside by year’s end, the report also provides a watch list of states where the issue is likely to surface again next year.

NAMIC tracks the progress of its priority advocacy issues on the Legislative Scorecard section of its Web site, NAMIC Online. The “Laws and Trends” reports are designed to give insurers an in-depth analysis of how national issues are developing in the states. Schmelzer said that other “Laws and Trends” reports will be available on the NAMIC Web site at www.namic.org.

Topics Trends Carriers Legislation