OLYMPIA, Washington – Insurance Commissioner Mike Kreidler today sent a letter to 136 insurers requesting specific information on consumer premiums after removing credit as a rating factor. He took this step in response to testimony he heard from consumers during the public hearing on November 23. In particular, he wants to fully understand the impact of this rule on the home, auto and tenant insurance markets. Responses are expected on December 20.
“I have heard testimonials from people who have seen their rates change because of this rule,” Kreidler said. “I ask insurers to share data on how they have applied these changes to their policyholders. “
The rule proposed by Kreidler would prevent insurers from using an individual’s credit history in the formulas they use to set auto, home and tenant insurance rates for three years. He proposed the rule in response to the economic damage suffered by many during the COVID-19 pandemic – damage that was borne disproportionately by communities of color and those who were already financially vulnerable.
Although the federal CARES law offers certain protections to consumers, these protections do not apply to everyone. This makes the credit histories used by insurers temporarily unreliable and inaccurate. Since we don’t know when the public health emergency will end, insurers should temporarily remove the inaccurate credit score factor.
Kreidler added, “I am carefully reviewing all of the public comments we have received and will not make any final decisions regarding the rule until I have assessed the information provided by the insurers. “
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