Déjà vu: Commissioner bans use of credit to calculate insurance rates, again

OLYMPIA, Wash. — After a year of fighting the insurance industry and the legislature, Washington’s Insurance Commissioner continues his all-in assault on getting credit scoring out of insurance.

“People are hurting and they need relief,” says Commissioner Mike Kreidler.

Last legislative session, the bill he sponsored died.

Months later, he temporarily banned the use of credit-based insurance scores in home, auto, and renter’s policies through an emergency rule.

And a Thurston County judge threw it out by fall.

New year, new rule.

This ban on using credit to calculate insurance premiums would last three years.

“Which is very unfair, considering it doesn’t have anything to do with the risk involved of how well you drive a car, or how you maintain your home,” says Kreidler.

Kreidler says using credit hurts low-income families, and people of color.

And with a pandemic economy, he says now is the time to act.

“They were able to write insurance and offer competitive rates before credit scoring. They’ll be able to do it afterwards,” says Kreidler.

Insurance industry groups fought Kreidler’s legislative measure and emergency rule. And they’re not happy this time around either.

“This is going to be harmful to consumers and it’s deeply disappointing to the Northwest Insurance Council,” says Council President Kenton Brine.

Rate changes

While the emergency rule was in effect, he says more than a million people saw premiums go up - some by hundreds of dollars.

“Particularly hurt were senior citizens on fixed incomes, single parents with a teen driver in the house,” says Brine.

And Brine predicts more people may feel the sting of those increasing bills.

“Because a lot of policies out there have not renewed yet so they have not seen these new rate increases affecting their insurance rates. Now they will,” says Brine.

But Commissioner Kreidler says this rule is revenue neutral, which means there are also thousands of people getting a break.

“We’re going ahead full speed, this is something where people are being harmed. We have a chance to help them with this rule today. That we’re not going to back off, we’re going to stick with it,” says Kreidler.

So – what’s going on with your premiums?

These rates could go into effect by as early as March.

Now, we do not know what the insurance industry will do - if they’re going to take Kreidler back to court again.

We also know there’s a bill in the legislature that would stop all of this so that lawmakers could study the use of credit scores and insurance rates for a year.

That bill’s in the Senate. It has to get out of committee by Thursday. If not, that legislation dies.

Follow the insurance credit saga:

• Why some people with good credit are still seeing sky-high insurance premium increases
• Judge overturns emergency order removing credit scoring from insurance rates
• Taking credit scoring out of insurance rates is an expensive change for some policyholders
• Emergency rule temporarily bans credit scoring to set insurance rates
• Bill to take credit scoring out of insurance rates dies in the Senate
• Race, credit scoring, and the most expensive neighborhood for car insurance in Washington
• Could you pay less for insurance, under a proposal to ban using credit scores to calculate premiums?

Email Jesse right now at consumer@kiro7.com

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