Bill > A05638

This bill aims to address concerns about using credit scores to determine automobile insurance premiums in New York. The legislation recognizes that credit scores, which are derived from consumer credit reports, can create unpredictable and potentially unfair insurance rate fluctuations that consumers may not fully understand. The bill directs the superintendent of financial services to conduct a comprehensive review of current actuarial methods used to calculate auto insurance premiums, specifically examining whether credit scoring is being used to assess insurance risk. If credit scoring methods are found to be in use, the superintendent must create new rules and regulations that eliminate the use of credit scores in premium calculations. The bill's underlying purpose is to prevent insurance companies from using credit scores as a significant factor in determining insurance rates, arguing that while credit scoring is one of many potential risk assessment tools, it should not be a decisive element in setting premiums. The new regulations would take effect 120 days after the bill becomes law, with provisions allowing immediate preparation of necessary regulatory changes.

Business and Industry

https://www.nysenate.gov/legislation/bills/2025/A5638