Rhode Island Code of Regulations › Title 230 - Department of Business Regulation › Chapter 20 - Insurance › Subchapter 05 - Personal Lines - Automobile and Homeowners Insurance › Part 3 - Automobile Insurance Rating › Section 230-RICR-20-05-3.13 - Use of Insurance Score in Rating or Underwriting

Current through June 14, 2024
A. No insurer is required to use an Insurance
				  Score in rating any insurance policy. If an insurer chooses to utilize
				  Insurance Scores in insurance rating, where applicable statutes allow such use,
				  the insurer must, in addition to the requirements of R.I. Gen. Laws §
										27-9-56, comply with the
				  following:
1. Demonstrate the statistically
				  predictive nature of the Insurance Score utilized in conjunction with its rate
				  filing.
2. Confirm that none of the
				  "negative factors" listed in R.I. Gen. Laws §
											27-9-56(c) have
				  been utilized in determining an Insurance Score or in the rating or
				  underwriting process.
3. If the
				  insurer chooses to use an Insurance Score it may do so only in accordance with
				  R.I. Gen. Laws §
											27-9-56 and this Part and may do
				  so only upon initiation or renewal of the policy.
4. If the use of an Insurance Score increases
				  the insured's rate in any manner, including making the insured ineligible for a
				  "tier", the insurer shall explain, in writing sent to the insured, all
				  information required by the Federal Fair Credit Reporting Act and the insured's
				  rights pursuant to R.I. Gen. Laws §
											27-9-56(a)(2).
5. If requested by the insured, pursuant to
				  R.I. Gen. Laws §
											27-9-56(a)(2),
				  the insurer must obtain an updated Insurance Score once every two (2) years
				  unless the insured is in the most favorably priced tier of the insurer or group
				  or insurance score was not used for the insured when the policy was initially
				  written. If required by R.I. Gen. Laws §
											27-9-56(a)(2),
				  once the updated Insurance Score is obtained the insurer shall:
a. Provide a decreased premium to the insured
				  at renewal, if the updated Insurance Score indicates that the insured is
				  entitled to a decrease in premium.
b. If the updated Insurance Score indicates
				  that the insured may be charged an increased premium, the insurer may only
				  increase the premium at renewal due to the Insurance Score if:
(1) The worsening is due to a bankruptcy, tax
				  lien, garnishment, foreclosure or judgment; or
(2) A subsequent Insurance Score undertaken
				  no sooner than six (6) months later confirms the worsening in score.
6. If a credit bureau
				  determines that disputed information is inaccurate or incorrect and such
				  information was used in determining an insurance score which resulted in a
				  denial, cancellation or nonrenewal of or higher premiums or less favorable
				  policy terms for a consumer, the insurer shall, within thirty (30) days of
				  receiving notice of correction, adjust the premium on the policy by refunding
				  the amount of the overpayment based on the corrected insurance score
				  retroactive to the shorter of the last twelve (12) months of coverage or the
				  actual period of coverage.
7. If
				  the credit history is insufficient, the insurer shall follow §
											15.5   of this
				  Subchapter.
8. If the insurer
				  receives a written request from a person claiming to have been affected by an
				  Extraordinary Life Event, the insurer shall follow §
											15.6   of this
				  Subchapter.