75th OREGON LEGISLATIVE ASSEMBLY--2009 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 1951
A-Engrossed
Senate Bill 377
Ordered by the Senate April 22
Including Senate Amendments dated April 22
Sponsored by Senator BONAMICI; Senators MONNES ANDERSON, MORSE,
ROSENBAUM, Representatives HARKER, HOLVEY, KENNEMER, TOMEI
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.
Prohibits insurer that issues personal insurance policy from
{ - increasing - } { + using credit information to
increase + } consumer's premium after rerating consumer at
consumer's request.
{ + Specifies that insurer must, in event that consumer
qualifies for improved rate, apply improved rate to related
policies for which consumer also would qualify for improved rate.
Specifies that improved rate is effective on date of request.
Allows insurer to credit renewal policy with difference between
current rate and improved rate in specified circumstances. + }
A BILL FOR AN ACT
Relating to insurance trade practices; creating new provisions;
and 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.
(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. - }
{ + (2)(a) If an insurer uses the consumer's credit history
or insurance score at any time in the rating of a personal
insurance policy, the consumer may request, no more than once per
insurer per policy line annually, that the insurer rerate the
consumer 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. { + The amendments to ORS 746.661 by section 1 of
this 2009 Act apply to personal insurance policies issued or
renewed on or after the effective date of this 2009 Act. + }
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