INDIANAPOLIS (August 17, 2007) – New York Gov. Eliot Spitzer has vetoed legislation opposed by the National Association of Mutual Insurance Companies (NAMIC) that would have hampered insurers’ use of credit-based insurance scores and ultimately hurt consumers.
NAMIC wrote to the governor urging him to veto the proposal, A.1416/S.4566, which would have prohibited insurers from considering home mortgage and auto loan inquiries in determining credit scores.
“This veto protects insurers’ ability to use valid and predictive information,” said Paul Tetrault, NAMIC’s state affairs manager for the Northeast U.S. “If this legislation had been enacted, it could have increased the cost and decreased the availability of coverage.”
In its letter to Gov. Spitzer, NAMIC pointed out that the legislation could have resulted in some consumers being unable to obtain coverage from companies that would have otherwise offered them coverage had the insurers been able to utilize the credit inquiry information. Other consumers would have had to pay more than they would if insurers were able to use the information.
“The legislation also would have required insurers to alter their underwriting business practices, incurring costs that would ultimately be borne by consumers,” Tetrault said. “We commend the governor for having the foresight to reject this anti-insurance and anti-consumer legislation.”
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Posted: Friday, August 17, 2007 12:00:00 AM. Modified: Friday, August 17, 2007 2:00:28 PM.
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