76th OREGON LEGISLATIVE ASSEMBLY--2011 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 1265
Senate Bill 486
Sponsored by Senator BONAMICI (Presession filed.)
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
Requires insurer using credit information in issuance of
personal insurance policies to rerate any personal insurance
policy held by consumer with insurer if requested by consumer
even if credit information was not used by insurer in initial
rating of policy.
Declares emergency, effective on passage.
A BILL FOR AN ACT
Relating to personal insurance policies; amending ORS 746.661;
and declaring an emergency.
Be It Enacted by the People of the State of Oregon:
SECTION 1. ORS 746.661 is amended to read:
746.661. (1) An insurer that issues personal insurance policies
in this state:
(a) May not cancel or nonrenew personal insurance that has been
in effect for more than 60 days based in whole or in part on a
consumer's credit history or insurance score.
(b) May use a consumer's credit history to decline coverage of
personal insurance in the initial underwriting decision only in
combination with other substantive underwriting factors. An offer
of placement with an affiliate insurer does not constitute a
declination of insurance coverage.
(c) May not use the following types of credit history to
decline coverage of personal insurance, calculate an insurance
score or determine personal insurance premiums or rates:
(A) The absence of credit history or the inability to determine
the consumer's credit history, if the insurer has received
accurate and complete information from the consumer, unless the
insurer does one of the following:
(i) If the insurer presents information that the absence of
credit history or the inability to determine the consumer's
credit history relates to the risk for the insurer, uses the
absence of a credit history or inability to determine a
consumer's credit history as allowed by rules adopted by the
Director of the Department of Consumer and Business Services;
(ii) Treats the consumer as if the applicant or insured has
neutral credit history, as defined by the insurer; or
(iii) Excludes the use of credit information as a factor and
uses only other underwriting criteria.
(B) Credit inquiries not initiated by the consumer or inquiries
requested by the consumer for the consumer's own credit
information.
(C) Inquiries identified on a consumer's credit report relating
to insurance coverage.
(D) Multiple lender inquiries identified as being from the home
mortgage industry and made within 30 days of one another, unless
only one inquiry is considered.
(E) Multiple lender inquiries identified as being from the
automobile lending industry and made within 30 days of one
another, unless only one inquiry is considered.
(F) The consumer's total available line of credit. However, an
insurer may consider the total amount of outstanding debt in
relation to the total available line of credit.
(d) May not rerate an existing policy or rerate a customer
based on a customer's credit history or the credit history
component of a customer's insurance score when the marital status
of the customer changes due to death or divorce.
(2)(a) If an insurer { + currently + } uses { - the
consumer's - } credit history or insurance { - score at any
time in the rating of a personal insurance policy - } { +
scores in the initial rating of personal insurance policies + },
{ - the - } { + a + } consumer may request, no more than once
per insurer per policy line annually, that the insurer rerate
{ - the consumer - } { + every policy held by the consumer
with the insurer, whether or not the policy has ever had a credit
history or insurance score applied to it, + } according to the
standards that the insurer would apply if the consumer were
initially applying for the same insurance policy.
(b) The insurer shall rerate the consumer within 30 days after
receiving a request from the consumer. After rerating the
consumer based upon the request, the insurer may not use credit
information from rerating to increase the premium on any personal
insurance policy the consumer holds. If the consumer qualifies
for a more favorable rating category, the insurer shall reduce
the premiums on all the personal insurance policies the consumer
holds in the related policy line for which the consumer's credit
history and insurance score would entitle the consumer to lower
premiums if the consumer were applying for a new policy. The
effective date of any rate change is the date of the consumer's
request.
(c) If a request to rerate a policy is received within 60 days
prior to a renewal date, or if the difference between the current
rate and the improved rate is less than $10, the insurer may
provide the consumer with the difference between the current rate
and the improved rate over the remainder of the current period as
a credit upon renewal. If the policy is canceled or not renewed,
the insurer shall refund the unearned premium. Any existing
claim-related discounts or surcharges shall carry forward for
each rerated policy.
(3) If an insurer uses disputed credit history to determine
eligibility for coverage of personal insurance and places a
consumer with an affiliate that charges higher premiums or offers
less favorable policy terms:
(a) The insurer shall rerate the policy retroactive to the
effective date of the current policy term; and
(b) The policy, as reissued or rerated, shall provide the
premiums and policy terms for which the consumer would have been
eligible if accurate credit history had been used to determine
eligibility.
(4) If an insurer charges higher premiums due to disputed
credit history, the insurer shall rerate the policy retroactive
to the effective date of the current policy term. As rerated, the
insurer shall charge the consumer the same premiums the consumer
would have been charged if accurate credit history had been used
to calculate an insurance score.
(5) Subsections (3) and (4) of this section apply only if the
consumer resolves the credit dispute under the process set forth
in the federal Fair Credit Reporting Act (15 U.S.C. 1681) and
notifies the insurer in writing that the dispute has been
resolved.
(6) Except as provided in subsections (2), (3) and (4) of this
section, an insurer may only use rating factors other than credit
history or insurance score to rerate the policy at renewal.
SECTION 2. { + This 2011 Act being necessary for the immediate
preservation of the public peace, health and safety, an emergency
is declared to exist, and this 2011 Act takes effect on its
passage. + }
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