The Ohio General Assembly’s Joint Committee on Agency Rule Review accepted an administrative rule sought by the Ohio Department of Insurance regarding an insurance company’s use of a consumer’s credit score for personal automobile and homeowners insurance.
“Credit scores” are numbers or ratings that insurance companies use for the purpose of predicting the future insurance loss exposure based in whole, or in part, on the consumer’s credit history, creditworthiness, credit standing or credit capacity.
The rule prohibits insurance companies from using a consumer’s credit score as the sole criterion for rating or underwriting personal auto and homeowners insurance policies. The rule also will require certain disclosures be made to consumers, including an explanation of what factors in their credit report have contributed to a higher rate or rejection of coverage.
It will go into effect in September 2003.
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