Washington judge overturns ban on rating insurance rates

A judge on Friday struck down a Washington state rule prohibiting insurers from using credit scoring to set auto, home and renter’s insurance rates.

Insurance Commissioner Mike Kreidler passed the rule in February, immediately sparking a legal challenge from insurer groups. The rule, which was due to take effect on March 4, has been put on hold while the legal process continues.

In her oral decision striking down the rule, Thurston County Superior Court Judge Indu Thomas said Kreidler exceeded her legal authority, according to Kreidler’s office. Kreidler’s spokeswoman, Stephanie Marquis, said in an email that a written decision from the court was not expected until next week.

“We will consult with our Assistant Attorney General on next steps and whether to appeal the decision,” Marquis wrote.

Earlier this year, Kreidler’s office began the process of implementing the permanent rule after an emergency rule the commissioner issued last year was struck down by a court, which found that there was no justification for circumventing the normal rule-making procedures.

Kreidler had argued that people who struggled financially during the pandemic were at risk of seeing defaults show up on their credit reports, and said insurers were charging good drivers with low credit scores nearly 80% plus for compulsory car insurance.

Republicans, insurers and others denounced the move at the time, saying it would increase costs for people on fixed incomes, like seniors, who received reduced insurance rates because of their good health. credit ratings.

“Today’s decision is a victory for Washington consumers, especially seniors, who will be able to continue to pay lower insurance rates that more accurately reflect their risk,” said Erin Collins, vice-president. Senior Chair of State and Policy Affairs of the National Association of Mutual Insurance Companies. , said in a statement.

In a statement, Kreidler said that while he was disappointed with the ruling, the ruling “confirms that the best place to address this issue on an ongoing basis is in the Legislative Assembly.”

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