An Act To Restrict the Use of Credit Scoring for Insurance Purposes
Maine Legislature, Session 123, LD 0419
Committee: Insurance and Financial Services
Sponsors: VALENTINO, BRAUTIGAM, CONOVER, MILLS, PERRY, RICHARDSON, VAUGHAN, MARRACHE
Amends: 24-A MRSA §2169-B

Legislative Document 
No. 419 
H.P.335 
House of Representatives, January 29, 2007 
An Act To Restrict the Use of Credit Scoring for Insurance 
Purposes 
Reference to the Committee on Insurance and Financial Services suggested and ordered 
printed. 
Presented by Representative VALENTINO of Saco. 
!r/~ 
/J7.7Il~ 
MllLICENT M. MacFARLAND 
Clerk 
Cosponsored by Representatives: BRAUTIGAM of Falmouth, CONOVER of Oakland, 
McKANE of Newcastle, MILLS of Farmington, PERRY of Calais, RICHARDSON of Warren, 
VAUGHAN of Durham, Senator: MARRACHE of Kennebec. 
Printed on rrcyded papt:r 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1. 24-A MRSA §2169-B, sub-§2, as enacted by PL 2003, c. 223, §1, is 
amended to read: 
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 210 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, 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 of personal insurance solely on the 
basis of Sf edit infoffRation with mit sonsidemtion of any othef applisable I:IndefWfiting 
fastof independent of sfedit infoffRation and not eKpFessly pfOhibited b)' pafagfaph A 
based in whole or in part on a person's credit information; 
C. 
Base an insured's renewal rates for personal insurance solely upon credit 
information, including an insured's total available line of credit, without consideration 
of any other applicable factor independent of credit information; 
D. 
Take an adverse action against a consumer solely because that consumer does 
not have a credit card account, without consideration of any other applicable factor 
independent of credit information; 
E. 
Consider an absence of credit information, the number of inquiries or an inability 
to calculate an insurance score in underwriting or rating personal insurance unless the 
insurer has demonstrated to the superintendent that an absence of credit information, 
the number of inquiries or an inability to calculate an insurance score is a relevant 
factor to the risk underwritten or rated by the insurer and the insurer applies this 
factor in a manner approved by the superintendent; eF 
F. 
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 
days before the date the policy is first written or renewal is issued~ ;...Q! 
G. Consider more than one inquiry from a lender regarding residential mortgage 
loans or automobile loans made within 30 days of one another. 
Sec. 2. 24-A MRSA §2169-B, sub-§4-A is enacted to read: 
4-A. Notice of insurance score. In addition to the notices required in subsections 3 
and 4, if an insurer uses credit information to calculate an insurance score for 
underwriting and rating purposes in accordance with this section, the insurer shall 
disclose to the insured on the declarations page of the policy that the insured is paying 
either a higher or lower premium based upon the insured's insurance score. The insurer 
shall also disclose the insurance score calculated by the insurer to the insured. An insurer 
may demonstrate compliance with this subsection by using the following example 
Page I - 123LR0864(Ol)-1 
disclosure statement: "You are paying a higher (or lower) premium for this policy based 
upon your credit-based insurance score of ........... It 
Sec. 3. 24-A MRSA §2169-B, sub-§5, as enacted by PL 2003, c. 223, §1, is 
repealed. 
Sec. 4. 24-A MRSA §2169-B, sub-§5-A is enacted to read: 
5-A. Dispute resolution; rescoring. The following provisions apply. 
A. If it is determined through the dispute resolution process set forth in Title 10, 
section 1317 or 15 United States Code, Section 168li(a)(5) that the credit information 
of a current insured was incorrect or incomplete and if the insurer receives notice of 
such determination from either the consumer reporting agency or from the insured, 
the insurer shall reunderwrite and rerate the consumer within 30 days of receiving the 
notice. 
After reunderwriting or rerating the insured, the insurer shall make any 
adjustments necessary, consistent with its underwriting and rating guidelines. If an 
insurer determines that the insured has overpaid the premium, the insurer shall refund 
to the insured the amount of overpayment calculated back to the last 12 months of 
coverage or the actual policy period, whichever is shorter. 
B. In addition to the requirements of paragraph A, an insurer that uses insurance 
scores to underwrite or rate risks shall, upon request of the insured, but no more often 
than once every 12 months: 
(1) Obtain an updated credit report and recalculate the insurance score; and 
(2) Reunderwrite and rerate the insured within 30 days of the request. 
After reunderwriting and rerating the insured, the insurer shall make any adjustments 
necessary, consistent with its underwriting and rating guidelines, on the effective date 
ofthe renewal of the policy. 
SUMMARY 
This bill prohibits insurers from denying, canceling or refusing to renew personal 
insurance in whole or in part on the basis of an insured's credit information. The bill also 
prohibits insurers from considering more than one credit inquiry from mortgage or 
automobile lenders for inquiries made within 30 days of one another. 
The bill requires insurers that use credit reports and credit scores in insurance 
underwriting to obtain an updated credit report to recalculate an insured's insurance scope 
and to reunderwrite and rerate the insured. The bill requires insurers to act upon the 
request of the insured within 30 days of the request, but does not require an insurer to do 
so more than once every 12 months. The bill provides that any adjustments in the policy 
premium be made at the time of renewal. 
The bill also requires insurers that use credit scores to disclose to insureds that the 
insured's premium is either higher or lower based upon the insured's credit-based 
insurance score and notify the insured of that insurance score.