Credit-based Insurance Scoring in Renewal Policy Underwriting Essential for Accuracy

The National Association of Mutual Insurance Companies will testify at an Alaska Division of Insurance hearing that, “at renewal, insurance carriers need the flexibility to engage in a total circumstances analysis of the basis for the change in a consumer’s credit score to ensure that consumers receive a premium rate that is commensurate with their current potential risk of loss exposure.”

NAMIC’s Aug. 30 testimony is in response to proposed regulations that would prohibit the use of credit-based insurance scoring in renewal of insurance policy underwriting.

The proposed regulations concern NAMIC, because “they categorically prohibit the consideration of credit scores in policy renewal situations without consideration of the factual basis for the change in the consumer’s credit score,” stated State Affairs Manager, Christian J. Rataj.

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