A new credit-based insurance scoring rule was signed into law on December 29 and will take effect on July 1 in Washington State. Insurance Commissioner Mike Kreidler said under the new rule, insurers can no longer use the term “unfavorable” to describe an attribute of a consumer’s credit history. Instead, they must tell the consumer why his or her credit history affected their ability to get insurance or to get the lowest price, even if the credit score is provided by a vendor.

“Despite having one of the nation’s toughest credit-based insurance scoring laws, many Washington consumers have not understood how their credit history affected their insurance rates or their ability to get insurance,” said Kreidler. “If insurers want to continue to use credit-based insurance scoring, then consumers deserve the best information available to help them get a better credit score and possibly, a lower insurance rate.”

New Credit Scoring Rule Signed (Washington DOI 12/29/04)

Text of WA Rulemaking (12/29/04)

January 6, 2005