April 8, 2009
Neil Alldredge, NAMIC vice president of state and policy affairs, and Liz Reynolds, Southeast state affairs manager, met yesterday in Tallahassee with Sean Shaw, Florida insurance consumer advocate, and Dan Sumner, deputy chief of staff from Chief Financial Officer Alex Sink’s office.
The meeting was scheduled as a result of sharing with CFO staff members NAMIC’s recently updated and released public policy brief, “Credit-Based Insurance Scoring: Separating Facts From Fallacies.”
Sink and Shaw announced their opposition to the use of credit-based insurance scoring during a press conference held March 19. NAMIC reported the CFO’s remarks in Advocacy Update and also responded with a press release to Florida media outlets.
Sumner and Shaw made it clear they do not consider the use of credit-based insurance scoring to have a disparate impact on minority populations, and they understand that a correlation does exist between the scores and claims-paying propensity. However, the inability for consumers to clearly understand why such a link exists, particularly in auto insurance, seems to be the primary reason underlying objections to the practice.
Sumner further clarified that Sink’s concerns are also rooted in the current economic crisis and could be temporary in nature. Shaw would prefer to see limits placed on the use of credit-based insurance scoring now and in the future, regardless of economic conditions.
“It is helpful to continue a dialogue about this issue, even though we realize there is not agreement,” said Alldredge. “NAMIC will continue to participate in efforts to preserve underwriting and rating freedom not only in Florida but throughout the country. Companies can help by doing even more to educate consumers about how credit-based insurance scores are used and how that use benefits most policyholders.”
Posted: Wednesday, April 08, 2009 12:00:00 AM. Modified: Wednesday, April 08, 2009 4:29:10 PM.
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