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House approves limits on use of credit scores in auto insurance underwriting (HB110) after extensive debate
Summary
The House passed a first substitute of House Bill 110 limiting the use of credit scores to determine eligibility, underwriting, rating and renewals for motor vehicle insurance while permitting limited discounts; the final tally on the first substitute was 61–11 after debate over consumer protection and market impacts.
Representative Wallace introduced first substitute House Bill 110 to curb the use of credit scores in automobile insurance underwriting and placed amendment number 4 on the record to remove credit scores as a basis for eligibility, underwriting, rating and renewals while allowing insurers to use scores as a discount mechanism if they choose and permitting the insurance commissioner to adopt rules to enforce the provisions.
Wallace said the issue came from constituent complaints and independent agents who observed unexplained premium increases tied to credit‑score usage. Proponents stressed consumers currently cannot see the proprietary scoring algorithms and that scores often reflect life events (illness, job loss) unrelated to driving safety. Supporters argued the tool is not predictive of driving behavior and that using it to raise premiums punishes consumers for unrelated credit history snapshots.
Opponents and industry‑friendly members warned of unintended market consequences: non‑domiciled insurers could continue to use scoring outside the state's reach and "cherry‑pick" profitable customers, leaving domiciled insurers at a competitive disadvantage. They warned a ban could shrink choice and raise overall rates if premium redistribution occurs.
Multiple substitute motions were offered. Representative Harper moved a second substitute that would have restored more permissive treatment; that substitute failed on a roll call reported as 36 yes, 38 no. After further debate the House voted on the first substitute and the chair announced the result: first substitute House Bill 110 passed with 61 yes and 11 no votes; the bill will be referred to the Senate.
Floor discussion emphasized consumer anecdotes of arbitrary rate increases tied to credit scores, the insurance commissioner's ability to require disclosure or rulemaking, and a compromise approach preserving discounts while guarding against punitive uses of credit scores for underwriting.
