Devoted to the Insurance industry and all thing related

Legislation that was snaking its way through the Senate has finally been approved in Delaware.  However, the approved legislation doesn’t quite resemble the original intention of the backers.  Initially the bill “would have banned insurers from using credit information to underwrite auto and homeowner policies” according to National Underwriter.

After some compromising the bill now “allows insurance companies to continue using credit-based insurance scores while putting in place additional consumer safeguards.”  The compromise was made to “allow insurers to use credit information for writing new business but not on policy renewals.”  I don’t understand how that’s a safeguard?  The insurers are still able to use a consumers credit score as part of the underwriting process.

I’m not making a judgment on whether insurance credit scores are good or bad but how is the compromise a safeguard?  According to “Richard Stokes, regional manager and counsel for the Property Casualty Insurers Association of America, the state already has comprehensive regulation governing how insurers use credit information.”