The Delaware Senate this week approved legislation that allows insurance companies to continue using credit-based insurance scores while putting in place additional consumer safeguards.
Senate Bill 31 as originally introduced would have banned insurers from using credit information to underwrite auto and homeowner policies. However, lawmakers were able to find consensus on compromise language that will enable insurers to use credit information for writing new business, but not on policy renewals.
Currently, Delaware has regulations governing how insurers use credit information. This legislation would add to these restrictions.
Insurers welcomed the compromise.
“We support the compromise,” said Richard Stokes, regional manager and counsel for the Property Casualty Insurers Association of America (PCI). “Simply put, insurers only want the ability to use the most accurate underwriting tools.”
The bill must still be considered by the House of Representatives.
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