View this article online: https://www.insurancejournal.com/news/midwest/2003/06/04/29501.htm
The Nebraska Legislature enacted two significant bills during the 2003 legislative session that will provide guidelines for credit-based insurance scoring and further modernize the regulatory environment for commercial lines insurance.
Nebraska is one of approximately 12 states that enacted the National Conference of Insurance Legislators’ (NCOIL) model act on insurance scoring this year. The NCOIL model requires an insurer to notify an applicant for insurance that credit information will be used in underwriting and rating. Credit information cannot be used as the sole basis for denying, canceling or non-renewing a policy or increasing rates.
The model requires customer notification of the primary factors that resulted in an adverse action being taken. The scoring model used must be filed with the department of insurance that will protect the model as a trade secret.
The insurance department’s omnibus bill (LB216), which among many things moved commercial lines form filing from prior approval to file and use, was enacted. This change brings form filing in line with the regulatory approach that has been in place for rate fillings for the past several years. The bill also corrected a negative court decision that held that the insurance director could not approve any forms that provided less coverage than under the standard fire policy.
The legislature also sent to the governor legislation that increases the cap on non-economic damages in medical liability cases from $1.25 million to $1.75 million.