If you have personal insurance in Washington State (auto, motorcycle, RV, home, mobile home, condo, renters insurance), THIS IS FOR YOU:
What is credit scoring?
“Currently, insurance companies are allowed to use credit information when deciding whether or not to offer someone insurance and to calculate how much to charge them.
Credit scores, along with other factors including where you live, your claims history, driving record and age, are used by insurers in a secret formula to create an "insurance score" they say predicts the likelihood of claims.” - OIC
Why is the Insurance Commissioner implementing an Emergency Credit Ban?
Kreidler said his decision was necessary since current temporary federal protections that placed a temporary hold on the reporting of certain negative credit information will end 120 days after the president declares an end to the coronavirus pandemic national emergency. Staff with the insurance commissioner's office said the rule takes effect immediately and will end three years after the federal or Washington’s state of emergency is declared over, whichever is later.
“The insurance industry’s dependency on the discriminatory practice of credit scoring has always been unfair,” said Kreidler in a statement. “But given that the federal protections from plummeting credit scores could end soon, we need to take action now to protect the public.”
– US News
Will this impact my insurance?
Policies that will be impacted are personal auto, motorcycles, RVs, homes, mobile homes, condos and renters insurance.
Insureds with better credit will likely see premium increases, and those with lower credit scores will likely see decreases, as credit will be removed from the price of personal insurance policies.
This is for personal insurance and impacting all insurance company’s in Washington State.
When will this start?
As of June 20th, you can expect to see the changes in new purchased policies.
For your existing policy(ies), you will see the changes go into effect as of your policy renewal date(s).
What is the plan for my policy?
We are anticipating your insurance company will send out renewal notices farther in advance (45-60 days), and you can expect to hear from Megan within 30 days of your renewal to review options.
Since this order is temporary, our advice may be to remain with your current insurance until the long-term decision is made. Switching carriers will have some impact on your insurance score/longevity benefits. However, we will review the best options during your renewal review.
Discount opportunities to consider are bundling accounts, adjusting deductibles, trying a telematics/driver-habit-monitoring program.