I 

108TH CONGRESS 

1ST SESSION H. R. 2796

To amend the Fair Credit Reporting Act to prohibit the use of consumer 

credit history for any insurance purpose and to require the disclosure 

of consumer reports and the credit scoring procedure in order to prevent 

inaccuracies and mistakes in consumer credit reports, and for other 

purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 18, 2003

Mr. THOMPSON of Mississippi introduced the following bill; which was referred 

to the Committee on Financial Services 

A BILL

To amend the Fair Credit Reporting Act to prohibit the 

use of consumer credit history for any insurance purpose 

and to require the disclosure of consumer reports and 

the credit scoring procedure in order to prevent inaccuracies and mistakes in consumer credit reports, and for 

other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Consumer Credit Pro5 tection Act Amendments of 2003’’. 
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1 SEC. 2. FINDINGS. 

2 Section 602(a) Fair Credit Reporting Act (15 U.S.C. 

3 1681) is amended—

4 (1) by redesignating paragraph (4) as para5 graph (6); 

6 (2) by striking paragraphs (2) and (3) and in7 serting the following new paragraphs: 

8 ‘‘(2) Consumer credit reporting agencies have 

9 assumed a dominant role in evaluating consumer 

10 credit and other information on consumers. 

11 ‘‘(3) Credit reports may report on as factors to 

12 establish a consumer’s eligibility for credit, insur13 ance, and even employment. 

14 ‘‘(4) The automated calculation of credit scores 

15 has become the primary way of quickly evaluating all 

16 of the subjective factors taken into account in deter17 mining a consumer’s creditworthiness, credit stand18 ing, credit capacity, debts, character, general reputa19 tion, or mode of living. 

20 ‘‘(5) When a credit reporting agency undertakes 

21 a business that has the potential to profoundly affect 

22 a consumer’s life, it is incumbent that these agencies 

23 ensure that the information provided is accurate.’’; 

24 and 
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1 (3) by inserting after paragraph (6) (as so re2 designated by paragraph 1 of this section) the fol3 lowing new paragraph: 

4 ‘‘(7) Due to the inequality of the rates of prop5 erty and casualty insurance, many State insurance 

6 commissioners have concurred that prohibiting the 

7 use of credit history and credit scores for personal 

8 lines of insurance and improving the disclosure of 

9 credit information will provide greater protection for 

10 the consumer.’’. 

11 SEC. 3. DEFINITIONS. 

12 (a) NEW DEFINITIONS.—Section 603 of the Fair 

13 Credit Reporting Act (15 U.S.C. 1681a) is amended by 

14 adding at the end the following new subsection: 

15 ‘‘(q) CREDIT SCORE, RISK PREDICTOR, AND RISK

16 SCORE.—The terms ‘credit score’, ‘risk predictor’, and 

17 ‘risk score’ mean the numerical value or categorization de18 rived from a statistical tool or modeling system used to 

19 predict the likelihood of certain credit behaviors, including 

20 default.’’. 

21 (b) AMENDMENTS TO EXISTING DEFINITIONS.—Sub22 section (m) of section 603 of the Fair Credit Reporting 

23 Act (15 U.S.C. 1681a(m)) is amended to read as follows: 

24 ‘‘(m) CREDIT TRANSACTION THAT IS NOT INITI25 ATED BY THE CONSUMER.—The term ‘credit transaction 
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1 that is not initiated by the consumer’ does not include the 

2 use of a consumer report by a person with whom the con3 sumer has a credit account for purposes of—

4 ‘‘(1) reviewing the account; or 

5 ‘‘(2) collecting the account.’’. 

6 SEC. 4. IMPERMISSIBLE USES OF CREDIT SCORES IN CON7 SUMER INSURANCE DETERMINATIONS; COM8 PLIANCE WITH EQUAL CREDIT OPPORTUNITY 

9 ACT. 

10 (a) IN GENERAL.—Section 604 of the Fair Credit 

11 Reporting Act (15 U.S.C. 1681b) is amended by adding 

12 at the end the following new subsections: 

13 ‘‘(h) IMPERMISSIBLE USES OF CONSUMER CREDIT

14 SCORES IN CONSUMER INSURANCE DETERMINATIONS.—

15 With respect to all personal lines of insurance, including 

16 any auto, homeowners, dwelling fire, life, disability, and 

17 health insurance or annuity, intended for consumer, fam18 ily, or household use, an insurance provider may not take 

19 any of the following actions on the basis, in whole or in 

20 part, of the consumer report obtained from a consumer

21 reporting agency), or a credit score, of any consumer, in22 cluding an applicant for such insurance: 

23 ‘‘(1) Refuse to underwrite or renew any such 

24 insurance. 

25 ‘‘(2) Cancel an existing policy of insurance. 
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1 ‘‘(3) Increase the premium for any such insur2 ance, either while the policy is in effect or at the 

3 time of renewal, or fail to offer or provide any dis4 count otherwise available. 

5 ‘‘(4) Rate the risk of the occurrence of the 

6 event covered by such insurance. 

7 ‘‘(5) Assign the insured or applicant to a rating 

8 tier. 

9 ‘‘(6) Place insurance for an insured consumer 

10 or applicant with an affiliated company. 

11 ‘‘(7) Require a particular payment plan under 

12 circumstances where any additional payment plans 

13 are available for such insurance. 

14 ‘‘(i) COMPLIANCE WITH EQUAL CREDIT OPPOR15 TUNITY ACT.—Any credit scoring system used to generate 

16 any risk or credit score shall comply with the Equal Credit 

17 Opportunity Act.’’. 

18 (b) TECHNICAL AND CONFORMING AMENDMENTS.—

19 (1) Section 604(a)(3) of the Fair Credit Re20 porting Act (15 U.S.C. 1681b) is amended—

21 (A) by striking subparagraph (C); 

22 (B) by redesignating subparagraphs (D), 

23 (E), and (F) as subparagraphs (C), (D), and 

24 (E), respectively; and 
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1 (C) in subparagraph (D) (as so redesig2 nated, by striking ‘‘or current insurer,’’. 

3 (2) Section 604(c) of the Fair Credit Reporting 

4 Act (15 U.S.C. 1681b(c)) is amended—

5 (A) in paragraphs (1) and (3) by striking 

6 ‘‘or insurance’’ each place such term appears; 

7 and 

8 (B) in paragraph (1), by striking ‘‘sub9 paragraph (A) or (C) of subsection (a)(3)’’ and 

10 inserting ‘‘subsection (a)(3)(A)’’. 

11 (3) Paragraphs (1) and (5) of section 604(e) of 

12 the Fair Credit Reporting Act (15 U.S.C. 1681b(e)) 

13 are each amended by striking ‘‘or insurance’’ each 

14 place such term appears. 

15 (4) Section 604(g) of the Fair Credit Reporting 

16 Act (15 U.S.C. 1681b(g)) is amended by striking 

17 ‘‘or insurance’’. 

18 (c) CLERICAL AMENDMENTS.—The heading for sec19 tion 604(c) of the Fair Credit Reporting Act (15 U.S.C. 

20 1681b(c)) is amended by striking ‘‘OR INSURANCE’’. 

21 (d) COMPLIANCE STUDY.—The Federal Trade Com22 mission shall conduct a study of the compliance of insur23 ance providers with the amendment made by this section 

24 and shall submit a report containing the findings and con25 clusions of the Commission to the Congress before the end 
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1 of the 1-year period beginning on the date of the enact2 ment of this Act. 

3 SEC. 5. AMENDMENTS TO THE DISCLOSURE OF CREDIT 

4 SCORES AND CREDIT REPORTS TO CON5 SUMERS. 

6 (a) IN GENERAL.—Section 609(a) of the Fair Credit 

7 Reporting Act (15 U.S.C. 1681g(a)) is amended by strik8 ing all of the provisions of such subsection that precede 

9 paragraph (2) and inserting the following: 

10 ‘‘(a) INFORMATION ON FILE; SOURCES; REPORT RE11 CIPIENTS.—Every consumer reporting agency shall, upon 

12 request, and subject to section 610(a)(1), clearly and ac13 curately disclose to the consumer the following: 

14 ‘‘(1) INFORMATION.—All information in the 

15 consumer’s file at the time of the request including 

16 credit consumer reports, any information concerning 

17 credit scores and credit consumer reports, and any 

18 other risk scores or predictors relating to the con19 sumer including any credit scores used, and a clear 

20 and concise summary of how the scores and predic21 tors are derived, including—

22 ‘‘(A) The factors taken into account in de23 riving a score or predictor; 

24 ‘‘(B) How such factors are applied to the 

25 consumer; 
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1 ‘‘(C) The relative weight given to each fac2 tor; 

3 ‘‘(D) The manner and extent to which 

4 such factors raise or lower the score or pre5 dictor; 

6 ‘‘(E) The names of all persons that pro7 vided the credit score or credit file upon which 

8 the credit score was created; and 

9 ‘‘(F) A statement indicating that the infor10 mation and credit scoring model may be dif11 ferent from the credit score that may be used 

12 by the lender.’’. 

13 (b) ANNUAL DISCLOSURE OF RIGHTS REQUIRED.—

14 Section 609 of the Fair Credit Reporting Act (15 U.S.C. 

15 1681g) is amended by adding at the end the following new 

16 subsection: 

17 ‘‘(d) ANNUAL DISCLOSURE OF RIGHTS REQUIRED.—

18 ‘‘(1) IN GENERAL.—A credit reporting agency 

19 shall annually provide a consumer with the written

20 summary of rights required under section 609(c), by 

21 letter sent by first-class mail, whenever one of the 

22 following events occurs within any 12-month period: 

23 ‘‘(A) The credit reporting agency has re24 ceived 3 credit inquiries pertaining to the con25 sumer. 
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1 ‘‘(B) The credit reporting agency has re2 ceived a report that would add negative infor3 mation to the consumer’s file. 

4 ‘‘(2) FORMAT OF LETTER.—Any letter mailed 

5 to a consumer pursuant to this subsection may be a 

6 form letter, except that each letter shall include a 

7 notice or separate form the consumer may complete 

8 and return to the consumer reporting agency to re9 quest a copy of the credit consumer report. 

10 ‘‘(3) ADDITIONAL CONTACT INFORMATION

11 UNDER CERTAIN CIRCUMSTANCES.—In the case of 

12 any consumer reporting agency which compiles and 

13 maintains files on consumers on a nationwide basis, 

14 the letter or notice shall include a toll-free telephone 

15 number and worldwide web address established by 

16 the agency for the consumer to request a free report 

17 under the terms of section 612(c).’’. 

18 (c) FREE DISCLOSURES UNDER CERTAIN CIR19 CUMSTANCES.—Section 612(c) of the Fair Credit Report20 ing Act (15 U.S.C. 1681j(c)) is amended to read as fol21 lows: 

22 ‘‘(c) FREE DISCLOSURE OF CONSUMER REPORTS.—

23 In addition to the disclosures required under subsection 

24 (b) or the law of any State, upon the request of a con25 sumer, a consumer reporting agency shall make all disclo-
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1 sures pursuant to section 609 without charge to that con2 sumer under the following circumstances: 

3 ‘‘(1) Annually, upon the written, oral, or elec4 tronic request of the consumer. 

5 ‘‘(2) Up to 3 additional times a year, if a con6 sumer certifies in writing that the consumer—

7 ‘‘(A) is unemployed and intends to apply 

8 for employment in the 60-day period beginning 

9 on the date on which the certification is made; 

10 ‘‘(B) is a recipient of public welfare assist11 ance; or 

12 ‘‘(C) has reason to believe that the file on 

13 the consumer at the agency contains inaccurate 

14 information due to fraud or identity theft.’’. 

15 (d) DUTIES OF USERS TAKING ADVERSE ACTIONS

16 ON THE BASIS OF INFORMATION CONTAINED IN CON17 SUMER REPORTS.—Section 615(a) of the Fair Credit Re18 porting Act (15 U.S.C. 1681m(a)) is amended to read as 

19 follows: 

20 ‘‘(a) DUTIES OF USERS TAKING ADVERSE ACTIONS

21 ON THE BASIS OF INFORMATION CONTAINED IN CON22 SUMER REPORTS.—

23 ‘‘(1) IN GENERAL.—If any person takes any ad24 verse action with respect to any consumer that is 
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1 based in whole or in part on any information con2 tained in a consumer report, the person shall—

3 ‘‘(A) provide oral, written, or electronic no4 tice of the adverse action to the consumer; and 

5 ‘‘(B) provide a copy of the consumer’s 

6 complete report that the consumer reporting 

7 agency provided to the user, including any in8 formation concerning credit scores and credit 

9 consumer reports, and any other risk scores or 

10 predictors relating to the consumer including 

11 any credit scores used; and 

12 ‘‘(2) SUMMARY OF RIGHTS.—A user who pro13 vides a notice and a copy of a consumer report and 

14 credit score to a consumer under paragraph (1) shall 

15 also provide to the consumer—

16 ‘‘(A) a written summary of all of the rights 

17 that the consumer has under this title; 

18 ‘‘(B) an explanation of how the consumer 

19 may exercise the rights of the consumer under 

20 this title; 

21 ‘‘(C) a list of all Federal agencies respon22 sible for enforcing any provision of this title 

23 and the address and any appropriate phone 

24 number of each such agency, in a form that will 
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1 assist the consumer in selecting the appropriate 

2 agency; and 

3 ‘‘(D) a statement that the consumer may 

4 have additional rights under State law and that 

5 the consumer may wish to contact a State or 

6 local consumer protection agency or State attor7 ney general to learn of those rights. 

8 ‘‘(3) FORM OF SUMMARY OF RIGHTS.—

9 ‘‘(A) IN GENERAL.—The user shall provide 

10 a description in writing of the rights of the con11 sumer under paragraph (2) using the form and 

12 content prescribed by the Federal Trade Com13 mission (after consultation with each Federal 

14 agency referred to in section 621(b). 

15 ‘‘(B) COMPLIANCE WITH SUBSTANTIALLY

16 SIMILAR FORMAT.—Any user shall be deemed to 

17 be in compliance with this subsection if the user 

18 provides disclosures under paragraph (2) that 

19 are substantially similar to the model disclosure 

20 adopted by the Federal Trade Commission 

21 under this paragraph. 

22 ‘‘(C) EFFECTIVE DATE OF SUMMARY OF

23 RIGHTS DISCLOSURES.—No disclosures shall be 

24 required under paragraph (2) before the date 

25 on which the Federal Trade Commission pre-
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1 scribes the form and content of such disclosures 

2 under subparagraph (A).’’. 

3 SEC. 6. EFFECTIVE DATE. 

4 The amendments made by this Act shall take effect 

5 at the end of the 90-day period beginning on the date of 

6 the enactment of this Act.

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