Credit Scoring Ban on Insurance Calculations – What Removal of Credit Scoring Means for Your Insurance Policy
Recently the Insurance Commissioner of Washington State has banned the use of credit as part of an individual’s insurance score and using those scores to determine premium. This will go into effect on June 20, 2021. Most all insurers in Washington State and across the country have utilized credit as part of the premium calculation process because it has proven to be a strong indicator of future losses.
As an Independent Agent in Washington State, we represent many insurance carriers. These carriers are working quickly to address these changes to insurance premium calculations. Additionally, we are reviewing how the ban on credit-based insurance information will affect our policyholders.
We will continue to work with companies, regulators, and elected officials on this important issue to find a solution that results in a fair and competitive marketplace.
During this time, it is possible you may see some wild fluctuations in premiums as the companies we represent create new algorithms to calculate your premiums without the usage of a credit score. We ask that if you see a large fluctuation on your policy, that you give us a call to see if another company may be a better fit for you and provide you with a premium that you are happy with.
To learn more about this credit scoring ban, you may visit the Washington State Insurance Commissioners website at: https://www.insurance.wa.gov/credit-scoring-ban