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Credit-Based Insurance Scoring [F/S]

Our Position

NAMIC supports the “Model Act Regarding Use of Credit Information in Personal Insurance” that was adopted by the National Conference of Insurance Legislators and is largely the basis for credit-based insurance scores laws adopted today in 47 states. NAMIC opposes any attempts by state or federal lawmakers or insurance regulators to further restrict the use of credit-based insurance scores. Credit information has been widely used in other segments of the financial services industry for years, and insurance scores have proven to be a strong predictor of risk of loss. In a competitive marketplace, NAMIC finds no reason why insurers should be prohibited from using credit-based insurance scores in underwriting and rating a risk. It is a far more accurate and objective methodology than traditional underwriting practices, and credit-based insurance scores have been shown that they do not penalize financially responsible individuals through premium subsidization.