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Court Issues Stay on Washington Insurance Credit Scoring Ban

March 3, 2022

A Washington judge issued a stay on a rule banning the use of credit scoring by insurers in that state, and consolidated cases challenging the ruling, until the merits of the cases are decided.

The rule handed down from Insurance Commissioner Mike Kreidler was set to take effect Friday. It bans the use of credit-based insurance scores in the rating and underwriting of insurance to be in effect starting March 4 through three years after either the federal or state emergency declaration ends, whichever is longer.

Last week the American Property Casualty Insurance Association along with co-petitioners the Professional Insurance Agents of Washington, and the Independent Insurance Agents and Brokers of Washington joined with the National Association of Mutual Insurance Companies in filing a joint motion to transfer and consolidate separately filed petitions in Thurston County Superior Court.

Washington Insurance Commissioner Mike Kreidler
Washington Insurance Commissioner Mike Kreidler

The court consolidated the cases and e until the merits of the case are decided.

The group’s issued a statement from Claire Howard, APCIA senior vice president, general counsel, and corporate secretary.

“Commissioner Mike Kreidler’s permanent rule is raising rates for over a million Washington consumers,” Howard’s statement reads. “We are pleased the court consolidated the legal challenges, transferred the separately filed petitions to a single court, and approved an immediate stay on the permanent rule. We look forward to explaining our legal arguments against this onerous and unnecessary rule that is ignoring risk-based pricing and raising premiums for lower risk Washington consumers.”

A spokesperson for Kreidler’s office declined to comment.

In mid-February the APCIA along with co-petitioners the PIA, and the IIABW together with NAMIC filed a joint motion to transfer and consolidate separately filed petitions in Thurston County Superior Court challenging Commissioner Kreidler’s permanent rule banning credit history for at least 3 years.

The joint motion was submitted to Judge Wilson. On Feb. 23, Judge Wilson denied the transfer of both petitions to her court and assigned the consolidation and embedded transfer issue to NAMIC’s Judge Indu Thomas. A hearing took place before Judge Thomas on Feb. 25, 2022.

Thomas consolidated the APCIA, PIA, IIABW and NAMIC petitions in her court and stayed the permanent rule effective immediately. The permanent rule, which would have been effective on March 4, will remain stayed until the Judge reaches a final decision on the merits. We do not expect any order setting forth the schedule for briefing and arguing the merits will be entered until the Office of the Commissioner produces the agency record compiled in support of the permanent rule that is the subject of the stay.

Kreidler is also proposing a new “transparency rule” requiring insurers to provide policyholders with a written explanation for any premium change.


Topics Agencies Washington

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