Effective on an emergency basis as of June 20, 2021, the use of credit scoring as a rating factor for insurance premiums and coverage is no longer allowed.
The ban affects new policies and old policies upon their renewal date following June 20, 2021.
While credit scores have been used by the insurance industry to help determine premium rates for decades, the Insurance Commissioner of Washington has determined that concerns about credit scoring perpetuating structural inequity and access to insurance is a real problem and this the ban was instituted. The goal of the ban is to lower premium rates and increase access to protection for people with lower credit ratings who are also often in more vulnerable populations. The ban, however, may also have the effect of raising rates for some who have excellent credit scores since this factor will no longer be used in the premium evaluation. Over the next several years, consumers can expect to see some fluctuation in their rates as the industry adjusts to a new evaluation model, although no large fluctuations are expected.
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