Connecticut House Bill HB06089

Connecticut 2019 Regular Session

• Introduced: 1/24/19
• Refer: 1/24/19

Caption

An Act Prohibiting Insurance Companies From Using Certain Credit Scores As A Factor In Underwriting Or Rating Private Passenger Nonfleet Automobile Insurance Policies.

Impact

If enacted, HB 06089 would alter existing state insurance laws by eliminating credit scores as a possible determining factor for auto insurance underwriting and rating for specific applicants. Advocates of the bill argue that credit scores can unfairly disadvantage individuals who may have low credit scores due to factors other than their driving records or the risk of insuring them. This change is expected to benefit a segment of the population, particularly those with limited financial resources who maintain a satisfactory credit score but may have trouble securing fair insurance rates.

Summary

House Bill 06089 seeks to restrict the factors that insurance companies can use when underwriting or rating private passenger nonfleet automobile insurance policies. Specifically, the bill aims to prohibit insurers from utilizing an applicant's or insured's credit history as a consideration in determining their insurance rates, provided that the credit score is not less than 600 points. This legislative measure reflects a growing concern about the fairness and implications of using credit scores in insurance underwriting practices.

Contention

However, opposition to the bill may arise from insurance companies who argue that credit scores reflect a person's likelihood of filing claims, and thus provide crucial data for risk assessment. Insurers may contend that removing credit score consideration could lead to increased rates for lower-risk insured individuals as well, effectively shifting the burden of underwriting losses. Therefore, the bill has the potential to ignite debate about balancing consumer protection with the interests of insurance providers and the overall stability of the insurance market.