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STATE OF
OKLAHOMA
1st Session of the 50th
Legislature (2005)
SENATE BILL 676
By: Gumm
AS
INTRODUCED
An Act relating
to insurance; amending Section 4, Chapter 127, O.S.L. 2003 (36 O.S.
Supp. 2004, Section 953), which relates to use of credit
information; prohibiting use of credit information for certain
purposes; repealing Sections 1, 2, 3, 5, 6, 7, 8, 9 and 10, Chapter
127, O.S.L. 2003 (36 O.S. Supp. 2004, Sections 950, 951, 952, 954,
955, 956, 957, 958 and 959), which relate to the Use of Credit
Information in Personal Insurance Act; and providing an effective
date.
BE IT ENACTED BY
THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 3.
AMENDATORY Section 4, Chapter 127, O.S.L. 2003 (36 O.S. Supp. 2004,
Section 953), is amended to read as follows:
Section 953. An
insurer authorized to do business in this state that
uses shall not use a consumer’s credit
information to underwrite or rate risks, shall
not:
1. Use
an insurance score that is calculated using income, gender,
address, zip code, ethnic group, religion, marital status, or
nationality of the consumer as a factor;
2. Deny,
cancel or fail to renew a policy of personal insurance solely on
the basis of credit information, without consideration of any other
applicable underwriting factor independent of credit information
and not expressly prohibited by paragraph 1 of this
section;
3. Base
an insured’s renewal rates for personal insurance solely upon
credit information, without consideration of any other applicable
factor independent of credit
information;
4. Take
an adverse action against a consumer solely because he or she does
not have a credit card account, without consideration of any other
applicable factor independent of credit
information;
5.
Consider an absence of credit information or an inability to
calculate an insurance score in underwriting or rating personal
insurance, unless the insurer does one of the
following:
a.
treats the consumer as otherwise approved by the Insurance
Commissioner, if the insurer presents information that such an
absence or inability relates to the risk for the
insurer,
b.
treats the consumer as if the applicant or insured had neutral
credit information, as defined by the insurer,
or
c.
excludes the use of credit information as a factor and use only
other underwriting criteria;
6. Take
an adverse action against a consumer based on credit information,
unless an insurer obtains and uses a credit report issued or an
insurance score calculated within ninety (90) days from the date
the policy is first written or renewal is
issued;
7. Use
credit information unless not later than every thirty-six (36)
months following the last time that the insurer obtained current
credit information for the insured, the insurer recalculates the
insurance score or obtains an updated credit report. Regardless of
the requirements of this subsection:
a. at
annual renewal, upon the request of a consumer or the consumer's
agent, the insurer shall reunderwrite and rerate the policy based
upon a current credit report or insurance score. An insurer need
not recalculate the insurance score or obtain the updated credit
report of a consumer more frequently than once in a twelve-month
period,
b. the
insurer shall have the discretion to obtain current credit
information upon any renewal before the thirty-six (36) months, if
consistent with its underwriting guidelines,
and
c. no
insurer need obtain current credit information for an insured,
despite the requirements of paragraph 7 of this section, if one of
the following applies:
(1) the
insurer is treating the consumer as otherwise approved by the
Commissioner,
(2) the
insured is in the most favorably priced tier of the insurer, within
a group of affiliated insurers. However, the insurer shall have the
discretion to order such report, if consistent with its
underwriting guidelines,
(3)
credit was not used for underwriting or rating such insured when
the policy was initially written. However, the insurer shall have
the discretion to use credit for underwriting or rating such
insured upon renewal, if consistent with its underwriting
guidelines, or
(4) the
insurer reevaluates the insured beginning no later than thirty-six
(36) months after inception and thereafter based upon other
underwriting or rating factors, excluding credit information;
and
8. Use
the following as a negative factor in any insurance scoring
methodology or in reviewing credit information for the purpose of
underwriting or rating a policy of personal
insurance:
a.
credit inquiries not initiated by the consumer or inquiries
requested by the consumer for his or her own credit
information,
b.
inquiries relating to insurance coverage, if so identified on a
consumer’s credit report,
c.
collection accounts with a medical industry code, if so identified
on the consumer’s credit report,
d.
multiple lender inquiries, if coded by the consumer reporting
agency on the consumer’s credit report as being from the home
mortgage industry and made within thirty (30) days of one another,
unless only one inquiry is considered,
and
e.
multiple lender inquiries, if coded by the consumer reporting
agency on the consumer's credit report as being from the automobile
lending industry and made within thirty (30) days of one another,
unless only one inquiry is considered.
SECTION 3.
REPEALER Sections 1, 2, 3, 5, 6, 7, 8, 9 and 10, Chapter 127,
O.S.L. 2003 (36 O.S. Supp. 2004, Sections 950, 951, 952, 954, 955,
956, 957, 958 and 959), are hereby repealed.
SECTION 3. This
act shall become effective November 1, 2005.
50-1-258 TEK
02/11/200538394.95
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