An Act To Ensure Fairness Regarding Use of Consumer Credit Reports in Insurance Underwriting
Maine Legislature, Session 121, LD 0470
Committee: Insurance and Financial Services
Sponsors: SUSLOVIC, DAGGETT, DUDLEY, O'NEIL, PERRY, RECTOR, RICHARDSON, THOMPSON, TRAHAN, BRENNAN
Amends: 24-A MRSA §2

Legislative Document 
No. 470 
H.P.362 
House of Representatives, February 4, 2003 
An Act To Ensure Fairness Regarding Use of Consumer Credit 
Reports in Insurance Underwriting 
Reference to the Committee on Insurance and Financial Services suggested and ordered 
printed. 
Presented by Representati ve CANA V AN of Waterville. 
!r/~ 
/J1.1Jld£~ 
MILLICENT M. MacFARLAND 
Clerk 
Cosponsored by Representative SUSLOVIC of Portland, President DAGGETT of Kennebec 
and Representatives: DUDLEY of Portland, O'NEIL of Saco, PERRY of Calais, RECTOR of 
Thomaston, RICHARDSON of Brunswick, THOMPSON of China, TRAHAN of Waldoboro, 
Senator: BRENNAN of Cumberland. 
Printed on recycled paper 
Be it enacted by the People of the State of Maine as follows: 
Sec. I. 24-A MRSA §2I69-B is enacted to read: 
§2169-B. 
Use of consumer reports in insurance underwriting 
1. 
Definitions. 
As 
used 
in this 
section, 
unless 
the 
context 
otherwise 
indicates , 
the 
following 
terms 
have 
the 
following meanings. 
A. 
"Adverse underwriting decision" has the same meaning as 
in section 2204, subsection 1. 
B. 
"Consumer report" has the same meaning as in Title 10, 
section 1312, subsection 3. 
C. 
"Consumer reporting agency" has the same meaning as in 
Title 10, section 1312, subsection 4. 
D. 
"Insurance score" means a number calculated to predict 
the future loss exposure of an applicant for insurance or a 
policyholder that is based on consumer report information 
relating to credit history and experience. 
2. 
Use 
of 
consumer 
reports. 
Notwithstanding 
this 
subsection, 
an insurer may use a 
consumer report as permitted 
under the Fair Credit Reporting Act pursuant to Title 10, chapter 
and 15 United States Code, Chapter 41. 
An insurer may use 
information 
obtained 
from 
a 
consumer 
reporting 
agency 
to 
calculate 
an 
insurance 
score 
for 
underwriting 
and 
rating 
purposes, except that an insurer may not: 
A. 
Use an insurance score that is calculated using income L 
gender, address, zip code, ethnic group, religion, marital 
status or nationality of a consumer as a factor; 
B. 
Deny, cancel or refuse to renew a policy solely on the 
basis of information contained in a consumer report; 
C. 
Raise 
premium rates or 
reduce coverage on 
a 
policy 
solely on the basis of information contained in a consumer 
report; 
D. 
Take 
an adverse action against 
a 
consumer based on 
negative credit information caused by illness, period of 
unemployment or death of spouse; 
E. 
Consider an absence of credit history, the number 
0.( 
inquiries or requests made for a consumer's credit report or 
an inability to determine a credit history as 
a negative 
indicator on a consumer's insurance score; or 
.. 
F. 
Take 
an adverse action against 
a 
consumer 
based on 
credit information unless an insurer obtains 
and uses 
a 
credit rel20rt issued or an insurance score calculated within 
days before the date the 
l20li cy is first written or 
L~newal is issued. 
3. 
Notice of use of consumer reports. 
If consumer rel20rts 
are used by an insurer, an insurer shall provide written notice 
to consumers at the time of application for coverage that the 
insurer uses consumer reports in making underwriting decisions. 
~he notice must include contact information to allow an al2l2licant 
to address questions to the insurer relating to credit-based 
underwriting decisions by the insurer. 
4. 
Notice of adverse underwriting decisions. 
If an insurer 
makes an adverse underwriting decision using information obtained 
from 
a 
consumer 
rel20rt in coml2liance with this section, 
the 
insurer shall provide the apl2licant or policyholder with written 
notice of the adverse underwriting decision. 
The notice must 
also include the following information: 
A. 
The 
sl2ecific 
reason 
for 
the 
adverse 
underwriting 
decision; 
B. 
The sl2ecific credit-based information used to support 
the underwriting decision~ 
C. 
Contact 
information, 
including 
name, 
address 
and 
telephone number, for a person eml2loyed by the insurer who 
can answer questions 
concerning credit-based underwriting 
decisions made by the insurer; 
D. 
Contact 
information, 
including 
name, 
address 
and 
telel2hone number, 
for 
the 
consumer reporting agency that 
provided the insurer with the credit-based information; and 
E. 
Statements informing an al2l2licant or policyholder of a 
consumer's 
right 
to 
obtain 
a 
copy 
of 
that 
consumer's 
consumer 
report 
and 
the 
right 
to 
challenge 
information 
contained in that consumer report. 
5. 
Applicability. 
This section apl2lies only to personal 
automobile insurance and property and casual ty lnsurance. 
This 
section does not al2ply to commercial insurance. 
SUMMARY 
This 
bill prohibits 
an 
insurance 
company 
authorized 
to 
transact automobile or homeowners' insurance in this State from 
making 
underwriting 
and 
rating 
decisions 
based 
solely 
on 
information contained in consumer credit reports. The bill also 
prohibits 
an 
insurer 
from 
using 
an 
insurance 
score that is 
calculated using income, gender, address, zip code, ethnic group, 
religion, marital status or nationality as 
a 
factor and 
from 
considering an absence of credit history or 
an inability to 
determine 
a 
credit 
history 
as 
a 
negative 
indicator 
on 
an 
insurance score. An insurer may continue to use consumer credit 
reports in underwriting and rating decisions in conjunction with 
other relevant underwriting criteria to the extent allowed under 
state and federal fair credit reporting laws. 
The bill also requires insurers to provide written notice to 
a 
consumer "'Tho is adversely affected by a credit report. The 
notice must include the specific credit-based reasons for the 
adverse decision and contact information necessary to assist the 
consumer in appealing the insurer's decision.