HB0420 96TH GENERAL ASSEMBLY

LRB096 07536 RPM 17631 b

96TH GENERAL ASSEMBLY
State of Illinois
2009 and 2010
HB0420

Introduced 2/3/2009, by Rep. Monique D. Davis

SYNOPSIS AS INTRODUCED:

215 ILCS 5/155.22b
215 ILCS 157/Act rep.

Amends the Illinois Insurance Code. Provides that no company issuing a policy of life or accident and health or personal insurance may use a consumer's credit information for the purpose of rating or underwriting any such policy. Repeals the Use of Credit Information in Personal Insurance Act. Makes other changes.

A BILL FOR

AN ACT concerning insurance.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Illinois Insurance Code is amended by changing Section 155.22b as follows:

(215 ILCS 5/155.22b)

Sec. 155.22b. Rating, claims handling, and underwriting decisions.

(a) No company issuing a policy of property and casualty insurance may use the fact that an applicant or insured incurred bodily injury as a result of a battery or other violent act committed against him or her by a spouse or person in the same household as a sole reason for a rating, underwriting, or claims handling decision.

(b) If a policy excludes property coverage for intentional acts, the insurer may not deny payment to an innocent co-insured who did not cooperate in or contribute to the creation of the loss if the loss arose out of a pattern of criminal domestic violence and the perpetrator of the loss is criminally prosecuted for the act causing the loss. Payment to the innocent co-insured may be limited to his or her ownership interest in the property as reduced by any payments to a mortgagor or other secured interest.

(c) No company issuing a policy of life or accident and health or personal insurance may use a consumer's credit information or credit score for the purpose of rating or underwriting any such policy. For the purpose of this subsection (c):

"Consumer" means an insured or an applicant for an insurance policy whose credit information is used or whose insurance score is calculated in the underwriting or rating of an insurance policy.

"Credit information" means any credit-related information derived from a credit report, found on a credit report itself, or provided on an application for insurance. Information that is not credit-related shall not be considered credit information, regardless of whether it is contained in a credit report or in an application or is used to calculate an insurance score.

"Credit report" means any written, oral, or other communication of information by a consumer reporting agency bearing on a consumer's credit worthiness, credit standing, or credit capacity, that is used or expected to be used or collected in whole or in part for the purpose of serving as a factor to determine insurance premiums, eligibility for coverage, or tier placement.

"Insurance score" means a number or rating that is derived from an algorithm, computer application, model, or other process that is based in whole or in part on credit information for the purposes of predicting the future insurance loss exposure of an individual applicant or insured.

"Personal insurance" means private passenger automobile, homeowners, motorcycle, mobile-homeowners and non-commercial dwelling fire insurance policies, and boat, personal watercraft, snowmobile, and recreational vehicle polices. Such policies must be individually underwritten for personal, family, or household use.

(Source: P.A. 93-200, eff. 1-1-04.)

(215 ILCS 157/Act rep.)

Section 10. The Use of Credit Information in Personal Insurance Act is repealed.