73rd OREGON LEGISLATIVE ASSEMBLY--2005 Regular Session
Enrolled
Senate Bill 573
Sponsored by COMMITTEE ON BUSINESS AND ECONOMIC DEVELOPMENT (at
the request of Department of Consumer and Business Services
Insurance Division)
CHAPTER ................
AN ACT
Relating to insurance trade practices; amending ORS 746.661.
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.
Enrolled Senate Bill 573 (SB 573-B) Page 1
(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) If an insurer assigns a consumer to a less favorable rating
category for a policy of personal insurance based in whole or in
part on the consumer's credit history or insurance score, the
consumer may request, no more than once annually, that the
insurer rerate the consumer according to the standards that the
insurer would apply to the consumer if the consumer were
initially applying for the same personal insurance.
(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.
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Enrolled Senate Bill 573 (SB 573-B) Page 2
Passed by Senate April 18, 2005
Repassed by Senate June 22, 2005
...........................................................
Secretary of Senate
...........................................................
President of Senate
Passed by House June 14, 2005
...........................................................
Speaker of House
Enrolled Senate Bill 573 (SB 573-B) Page 3
Received by Governor:
......M.,............., 2005
Approved:
......M.,............., 2005
...........................................................
Governor
Filed in Office of Secretary of State:
......M.,............., 2005
...........................................................
Secretary of State
Enrolled Senate Bill 573 (SB 573-B) Page 4