OLYMPIA – Washington’s insurance commissioner Mike Crydler on Tuesday issued a temporary emergency order banning insurers from using credit units to set rates for personal property insurance in the wake of the COVID-19 epidemic.
The emergency order, introduced this week, will take effect on June 20, but Crydler is working to turn it into a three-year ban to help consumers as they recover from the epidemic of restrictions that have left people unemployed.
The new rule requires insurers to submit amended policy plans to the Crydler office by May 6. The ban then applies to any new policies or policy extensions that were developed on or after June 20.
“We are trying to protect the consumer here from what insurance companies are now using,” Kreidler said in an interview. “Which is to say that if you have a low credit score, you are obviously making bad choices.
“Many do not make it a personal choice out of a desire to do so,” he added. “They do it because they are financially pushed to their corner.”
The order applies to private car insurance, as well as to tenant ակալ homeowner coverage, as a rule; ապահով prohibits insurers from using credit history to determine premiums, rates, or eligibility for personal insurance coverage. The ban applies to all new policies or policy updates that were developed on or after June 20.
Tuesday’s orders are the latest in a series of crackdowns on Democrats over long-term credit crunch as they seek to end the practice in Washington. An organization that opposed the order on Tuesday called it a deadline for the Legislature to suspend a similar proposal requested by Kreidler this year.
Senate Bill 5010, sponsored by Sen. Mona Dass, D.C., is required by Kraidler a Governor Aysay Insley to end the use of credit bills for personal insurance, which stopped this year after being amended. The proposal was one of the proposals presented at this year’s session, which aimed to improve justice in government “society”.
NT Insurance Company, chairman of the non-profit industrial organization Kenton Bryan, called the Kreidler emergency order an “attempt to circumvent the legal process and set unilateral rules.”
Bryan described credit scores as “proven” tools that “often do not save consumers money.”
JT Wilcox, head of the GOP minority in the Elm House on Tuesday, said he had not yet read the details of the order, but he criticized the use of another emergency order in the epidemic for more than a year.
“And I think the responsible members of the legislature և the public should be deeply concerned about the normalization of the rules of emergency by various elected officials,” Wilcox told a regular news conference. “People in Washington do not expect their government to behave.”
The order, however, was met with satisfaction by Consumer Reports.
“Credit rates based on insurance rates increase the negative impact of income mismatch and systemic racism in our society,” said Chuck Bell, director of consumer reporting programs. “Today’s action will ensure that the price of insurance is fairly priced in Washington and will help everyone afford the coverage they need. We hope the state legislature will take steps to make the credit ban permanent before the end of this order. ”
Most states allow insurers to use what they call credit-based insurance to partially determine homeowners’ premiums.
Bryan said it was too early to say whether the insurance industry could sue.
“I would certainly anticipate that they would file a lawsuit,” Kreidler said.