New Jersey Lawyers - New Jersey attorneys
How is insurance scoring different in New Jersey?
The New Jersey Department of Banking and Insurance examined the practice of insurance scoring in more than 40 states to help craft a comprehensive approach that will protect consumers and encourage competition. Consumer safeguard includes:Auto insurance companies that use insurance scoring...
CANNOT:
Use an insurance score to deny, cancel or non-renew coverage
Use an insurance score for consumers covered by the Special Automobile Insurance Policy or Basic Policy programs
Use an insurance scoring model that considers race, ethnicity, sex, age, religion, income, address or unpaid medical bills
Offer less favorable payment plans based on credit
MUST:
Provide written notice to applicants and existing policyholders of the practice and factors that affect the scoring
Provide written notice and specific explanations if an “adverse action” is taken against the applicant, in whole or in part, because of their credit history
Consider multiple credit inquiries for home or auto loans as one inquiry if requests were made within a 30-day period
Make exceptions for consumers whose credit has been directly influenced by extraordinary life events, such as catastrophic illness, injury, death of spouse, child, or parent, temporary loss of employment, divorce or identity theft (An insurer may only consider credit information not affected by the event)
Protect existing customers who have been claim and violation free in their company for seven years
Protect consumers without a credit history
Submit their scoring model to the Department and fully disclose the factors used in establishing the model, as well as its statistical justification