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Use of Credit Information in Insurance

For the last several years, insurance companies have been using credit information to determine a consumer's level of risk before selling or renewing auto, home or renter insurance policies. The insurance companies believe that there is a direct correlation between a consumer's financial stability and risk of filing an insurance claim. Insurers may use a consumer's credit score as one factor in assigning premiums, deciding whether to accept or decline coverage or in the decision to place a consumer with a nonstandard (generally higher priced) insurer.

NCSL Information

State Legislation || NCSL Publications

Other Information

Reports

Last Update: December 18, 2007

NCSL Staff Contact: Heather Morton, (303) 364-7700, Denver

State Legislation

2007 Legislation 2006 Legislation

2005 Legislation 2004 Legislation

2003 Legislation 2002 Legislation

2001 Legislation

NCSL Publications

Credit Reporting: A Primer for Policymakers, August 2006

The Roar Over Credit Scores, State Legislatures, October/November 2004

Reports

State Reports:

Report to the 79th Legislature - Use of Credit Information by Insurers in Texas
Texas Department of Insurance, December 30, 2004

Report on the Credit Scoring Data of Insurers in Maryland
Maryland Insurance Administration, February 2004

Insurance-Based Credit Scores: Impact on Minority and Low Income Populations in Missouri
Missouri Department of Insurance, Statistics Section, January 2004

Effect of Credit Scoring on Auto Insurance Underwriting and Pricing
Office of Washington State Insurance Commissioner, January 2003

Federal Report:

Credit-Based Insurance Scores: Impacts on Consumers of Automobile Insurance
A Report to Congress by the Federal Trade Commission, July 2007

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