093_HB3661sam006

 










                                     LRB093 09245 LRD 15773 a

 1                    AMENDMENT TO HOUSE BILL 3661

 2        AMENDMENT NO.     .  Amend House Bill 3661,  AS  AMENDED,
 3    by replacing all of Section 99 with the following:

 4        "Section  95.  If and only if House Bill 1640 of the 93rd
 5    General Assembly becomes law in the form it passed the House,
 6    the Use of Credit Information in Personal  Insurance  Act  is
 7    amended by changing Section 20 as follows:

 8        (093 HB 1640 eng, Sec. 20)
 9        Sec.   20.  Use   of   credit  information.   An  insurer
10    authorized to do business in  this  State  that  uses  credit
11    information to underwrite or rate risks shall not:
12             (1)  Use an insurance score that is calculated using
13        income,  gender, address, ethnic group, religion, marital
14        status, or nationality of the consumer as a factor.
15             (2)  Deny, cancel, or nonrenew a policy of  personal
16        insurance  solely  on  the  basis  of credit information,
17        without   consideration   of   any    other    applicable
18        underwriting factor independent of credit information and
19        not  expressly  prohibited by item (1).  An insurer shall
20        not  be  considered  to  have   denied,   cancelled,   or
21        nonrenewed  a  policy if coverage is available through an
22        affiliate.
 
                            -2-      LRB093 09245 LRD 15773 a
 1             (3)  Base an insured's renewal  rates  for  personal
 2        insurance   solely   upon   credit  information,  without
 3        consideration of any other applicable factor  independent
 4        of   credit   information.    An  insurer  shall  not  be
 5        considered  to  have  based  rates   solely   on   credit
 6        information  if coverage is available in a different tier
 7        of the same insurer.
 8             (4)  Take  an  adverse  action  against  a  consumer
 9        solely because he or she does  not  have  a  credit  card
10        account,  without  consideration  of any other applicable
11        factor independent of credit information.
12             (5)  Consider an absence of credit information or an
13        inability to calculate an insurance score in underwriting
14        or rating personal insurance, unless the insurer does one
15        of the following:
16                  (A)  Treats the  consumer  as  otherwise  filed
17             with  approved  by  the  Department,  if the insurer
18             presents  information  that  such  an   absence   or
19             inability  relates  to  the risk for the insurer and
20             submits a filing certification  form  signed  by  an
21             officer   for   the  insurer  certifying  that  such
22             treatment is actuarially justified.
23                  (B)  Treats the consumer as if the applicant or
24             insured had neutral credit information,  as  defined
25             by the insurer.
26                  (C)  Excludes  the use of credit information as
27             a factor and uses only other underwriting criteria.
28             (6)  Take an adverse action against a consumer based
29        on credit information, unless an insurer obtains and uses
30        a credit report issued or an insurance  score  calculated
31        within  90 days from the date the policy is first written
32        or renewal is issued.
33             (7)  Use credit information unless  not  later  than
34        every  36 months following the last time that the insurer
 
                            -3-      LRB093 09245 LRD 15773 a
 1        obtained current credit information for the insured,  the
 2        insurer  recalculates  the  insurance score or obtains an
 3        updated  credit   report.   Regardless   of   the   other
 4        requirements of this Section:
 5                  (A)  At  annual  renewal, upon the request of a
 6             consumer or the consumer's agent, the insurer  shall
 7             re-underwrite  and  re-rate  the policy based upon a
 8             current credit report or insurance score. An insurer
 9             need not recalculate the insurance score  or  obtain
10             the   updated  credit  report  of  a  consumer  more
11             frequently than once in a 12-month period.
12                  (B)  The insurer shall have the  discretion  to
13             obtain  current  credit information upon any renewal
14             before the expiration of 36  months,  if  consistent
15             with its underwriting guidelines.
16                  (C)  An  insurer  is  not  required  to  obtain
17             current  credit  information for an insured, despite
18             the requirements of subitem (A) of item (7) of  this
19             Section if one of the following applies:
20                       (a)  The  insurer is treating the consumer
21                  as  otherwise  filed  with  approved   by   the
22                  Department.
23                       (b)  The    insured   is   in   the   most
24                  favorably-priced tier of the insurer, within  a
25                  group  of  affiliated  insurers.  However,  the
26                  insurer  shall  have  the  discretion  to order
27                  credit  information,  if  consistent  with  its
28                  underwriting guidelines.
29                       (c)  Credit was not used for  underwriting
30                  or  rating  the  insured  when  the  policy was
31                  initially written.  However, the insurer  shall
32                  have   the   discretion   to   use  credit  for
33                  underwriting  or  rating   the   insured   upon
34                  renewal,  if  consistent  with its underwriting
 
                            -4-      LRB093 09245 LRD 15773 a
 1                  guidelines.
 2                       (d)  The insurer re-evaluates the  insured
 3                  beginning   no   later  than  36  months  after
 4                  inception  and  thereafter  based  upon   other
 5                  underwriting   or   rating  factors,  excluding
 6                  credit information.
 7             (8)  Use the following as a negative factor  in  any
 8        insurance  scoring  methodology  or  in  reviewing credit
 9        information for the purpose of underwriting or  rating  a
10        policy of personal insurance:
11                  (A)  Credit  inquiries  not  initiated  by  the
12             consumer  or inquiries requested by the consumer for
13             his or her own credit information.
14                  (B)  Inquiries relating to insurance  coverage,
15             if so identified on a consumer's credit report.
16                  (C)  Collection   accounts   with   a   medical
17             industry  code,  if  so identified on the consumer's
18             credit report.
19                  (D)  Multiple lender inquiries, if coded by the
20             consumer reporting agency on the  consumer's  credit
21             report  as being from the home mortgage industry and
22             made within 30 days of one another, unless only  one
23             inquiry is considered.
24                  (E)  Multiple lender inquiries, if coded by the
25             consumer  reporting  agency on the consumer's credit
26             report as being from the automobile lending industry
27             and made within 30 days of one another, unless  only
28             one inquiry is considered.
29    (Source: 093 HB 1640 eng, Sec. 20)

30        Section  99.   Effective  date.   This  Section  and  the
31    changes  made  to Sec. 143.17a of the Illinois Insurance Code
32    in Section 5 of this  Act  take  effect  upon  becoming  law.
33    Section  95 of this Act takes effect on October 1, 2003.  The
 
                            -5-      LRB093 09245 LRD 15773 a
 1    rest of this Act takes effect on the uniform  effective  date
 2    provided by law.".