New Mexico Set to Better Protect Credit
New Mexico’s Personal Insurance Credit Information Act (PICIA) took effect Jan. 1. According to the Rocky Mountain Insurance Information Association, PICIA requires insurance companies to limit the use of credit information when selling, rating or renewing auto or homeowners insurance.
RMIAA also says the new law helps protect New Mexicans by:
•Insurers that use credit information must disclose that to consumers at the time of application.
•Insurers cannot deny, cancel or fail to renew coverage based solely on credit information.
•If an insurer is unable to determine a credit-based insurance score, the insurer is required to give the consumer an average or better-than-average rate.
•Insurers that use credit information must take into account the effect of any “extraordinary life circumstance.”
•If an insurer denies, cancels, or increases a consumer’s premium, or decreases a consumer’s coverage based on credit information, it must send an “adverse action” notice to the consumer.
•Insurers cannot use a credit-based insurance score to deny, restrict or alter fees charged for a premium payment plan.
•A consumer may request the insurer obtain current credit information and recalculate the credit-based score upon policy renewal.
Topics Carriers
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