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Use of Credit History and Insurance Score


An Insurer Must Inform You if They Intend to Use Your Credit Information

An insurer must notify you in writing, either on the application for insurance or at the time the insurance application is taken, and at the time of renewal, if they intend to obtain and use your credit information in underwriting or rating a personal insurance policy. The required notice may be given in the same medium as the application for insurance or the notice of renewal.


An Insurer Taking Adverse Action Based on Credit Info Must Provide Basis for that Action

Adverse action includes cancellation, denial, or failure to renew personal insurance, charging a higher insurance premium for personal insurance than would have been offered if credit history or an insurance score had been more favorable, or any reduction or unfavorable change in terms of coverage or amount of insurance due to credit history or insurance score.


Your Insurer’s Responsibility to You if They Take Adverse Action

If an insurer takes adverse action against you, based in whole or in part on your credit history or insurance score, the insurer must provide you with written notice that states the significant factors of the credit history or insurance score that resulted in the adverse action, in a manner that allows you to identify the basis for the adverse action.


How to Initiate a Reconsideration of the Adverse Action

The insurer must also provide you a Reconsideration Certification form that allows you to request reconsideration of the adverse action if you believe the adverse action was based on credit information that is incorrect. To have the adverse action reconsidered, you must initiate the dispute resolution process under the Fair Credit Reporting Act and fill out and return the Reconsideration Certification form to the insurer as outlined within that form. Reconsideration by the insurer consists of either:

  • rerating or reissuing the policy using accurate credit information, if the disputed credit information has been resolved; or
  • reunderwriting the policy without the use of credit information, if the credit information is still in dispute.

Provision for Extraordinary Life Circumstances

If your credit history or insurance score has been affected by a catastrophe, serious illness or injury, death of a spouse, child, or parent, divorce or involuntary interruption of spousal support or maintenance payments, identity theft, loss of employment for three or months from involuntary termination, military deployment overseas, or other extraordinary life circumstances, you may submit a request for exception documenting your situation. At the time the insurer provides notice of adverse action, they must notify you how to request this exception and that the request must be made no later than 60 days after receiving notice of adverse action.


Credit Information an Insurer Cannot Consider

An insurer may not cancel, deny, nonrenew, underwrite, or rate personal insurance coverage based in whole or in part on a variety of factors set forth in AS 21.36.460 including not having a credit history, being adversely affected by a joint account owner, or having a credit history or insurance score based on collection accounts identified with a medical history code.

An insurer may not use a credit history obtained more than 90 days before the policy is cancelled, denied, nonrenewed, underwritten, or rated.

If an insurer uses your credit history or insurance score, they have to reunderwrite and rerate the policy based on your current credit history or insurance score and current risk characteristics at least every 24 months.

See AS 21.36.460 and AS 21.36.461.


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