Gov. Dirk Kempthorne signed Senate Bill 1408, restricting insurers’ use of credit-based insurance scores, earlier this week despite being urged by several insurers and trade groups to veto it.
National Association of Independent Insurers (NAII) Northwest Regional Manager Michael Harrold expressed his disappointment at the governor’s action because ambiguity in the new law will be harmful to consumers. In particular, he objected to the law’s provision prohibiting insurers from taking certain actions based “primarily” on the use of credit history.
“Since insurers are unsure how to comply with the ‘primarily’ language, which may also lead to litigation, they may decide not to use insurance scores at all,” Harrold said. “That would be unfortunate for most consumers because they then will not receive the lower insurance premiums to which their favorable scores would entitle them. Most consumers will end up paying more for their insurance to subsidize individuals who are higher risks.”
Harrold, along with several other representatives of the insurance industry, had written to Kempthorne asking him to veto SB 1408.
Topics Carriers
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