New York Codes, Rules and Regulations
Title 11 - INSURANCE
Chapter IX - Unfair Trade Practices
Part 221 - Limitations Upon And Requirements For The Use Of Credit Information For Personal Lines Insurance
Section 221.3 - Use of credit information to underwrite or rate risks for personal lines insurance
Universal Citation: 11 NY Comp Codes Rules and Regs ยง 221.3
Current through Register Vol. 46, No. 39, September 25, 2024
(a) An insurer that uses credit information to underwrite or rate risks for personal lines insurance shall not:
(1) use an
insurance score that is calculated using income, gender, address, ZIP code,
ethnic group, religion, marital status, or nationality of the consumer as a
factor;
(2) deny a policy of
personal lines insurance solely on the basis of credit information, without
consideration of any other applicable underwriting factor(s) independent of
credit information;
(3) use credit
information to cancel a policy or as a basis for taking an adverse action
against a current insured. However, an insurer may place the insured in a
higher rated tier or reclassify that insured due to factors other than credit
information in accordance with section
2349 or
2351 of the
Insurance Law and its rates and rules filed with the superintendent;
(4) take an adverse action against a consumer
solely because he or she does not have a credit card account;
(5) consider, for any given program of
insurance, an absence of credit information or an inability to calculate an
insurance score in underwriting or rating personal lines insurance, unless the
insurer does one of the following:
(i) treats
the consumer as if the consumer had neutral credit information, as defined by
the insurer;
(ii) excludes the use
of credit information as a factor and uses only other underwriting criteria;
or
(iii) makes a filing with the
superintendent with respect to an individual consumer that shall be subject to
approval by the superintendent. The insurer shall present satisfactory
information applicable to the consumer that the absence of credit information
or the inability to calculate an insurance score relates to the risk for the
insurer; or
(6) use any
of the following factors as a negative factor in any insurance scoring
methodology or in reviewing credit information:
(i) credit inquiries not initiated by the
consumer or inquiries requested by the consumer for the consumer's own credit
information;
(ii) inquiries
identified on the consumer's credit report as relating to insurance
coverage;
(iii) collection accounts
that have been identified with a medical industry code on a consumer's credit
report;
(iv) multiple lender
inquiries made within 30 days of one another and coded on the consumer's credit
report as being from the home mortgage industry; however, an insurer may
consider only one such inquiry; or
(v) multiple lender inquiries made within 30
days of one another and coded on the consumer's credit report as being from the
automobile lending industry; however, an insurer may consider only one such
inquiry.
(b) An insurer may use credit information:
(1) in
conjunction with any other applicable underwriting factors independent of
credit information, upon application to deny the issuance of a new policy of
personal lines insurance. The offer by an affiliate insurer to write the
coverage or by the insurer to write the coverage through one of its tiers shall
not constitute a denial of a policy but shall constitute an adverse action if
the premium or policy conditions of the policy offered are less favorable to
the insured due to the use of credit information; and
(2) upon renewal, if such use reduces the
premium for the insured in accordance with the insurer's filed rates and
rules.
Disclaimer: These regulations may not be the most recent version. New York may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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