Hello Pibbers! Some time ago, I wrote an article on the use of credit scoring in insurance and it generated a slew of responses. Most of the comments were directed at the state and their authorizing carriers to use credit as an initial underwriting tool. Since that legislation was signed into law, there have been some instances of insurers, well, not playing by the rules! (shock!) To read the previous post, click HERE. Read on for information concerning the scofflaws (read “insurer”) that blamed their “error” on a computer glitch!
While insurers can and do use credit as an underwriting tool and have been doing so for some time now, the average consumer has no clue as to either (1) why insurers do this, and (2) how they are allowed to use credit in determining insurance premiums. I direct you to the following links that will describe the legalities of using credit and what is and what isn’t allowed under the law.
For the laws and rules detailing how credit may be used, click HERE for more information. This is the statutory language drafted by the Oregon Legislature, and you’ll have to scroll down a bit to get to the proper citation. The reference you’re looking for is ORS 746.641
For the announcement of that carrier who just got whacked for improper use of credit scoring, click HERE.