TDI Seeks Input on Credit Score Rules

The Texas Department of Insurance announced it is seeking public input on Article 21.49-2U of the Texas Insurance Code, which addresses the use of credit information and credit scoring in underwriting and rating for residential property and personal automobile insurance policies. TDI wants to determine if rules are necessary and/or to determine appropriate content of such rules in regards to the frequency at which an insurer must update credit information and recalculate credit scores.

Of concern is the reasonableness and accuracy of credit information and credit scores that may be years old and whether it is fair to use such dated information and credit scores to underwrite and rate insurance consumers. To effectively evaluate these issues, the department seeks input from insurance consumers and the insurance industry about the frequency at which credit information is collected, the frequency at which consumers’ credit scores are calculated, the costs of collecting credit information and calculating credit scores, the impact on underwriting and rating decisions if the collection of credit information and/or the recalculation of credit scores were to occur more or less frequently, and the fairness and reasonableness of these decisions on insurance consumers.

The input requested will be treated as informal comment and not subject to the responsiveness requirements of the Government Code that are applicable to the adoption of agency regulations. In the event the Department proposes rules to address these issues, that proposal will be officially published in the Texas Register and the public will have the opportunity to make formal public comment.

Written comments should be submitted by 5:00 p.m. on Oct. 14, 2005, to:

J’ne Byckovski
Senior Actuary
Property & Casualty Actuarial
Mail Code 105-5F
P.O. Box 149104
Austin, TX, 78714-9104

Comments may also be submitted via e-mail to: J’ne.Byckovski@tdi.state.tx.us.