HB 5014 Summary

• Prohibits insurers from using credit history as the sole basis for declining, canceling, or nonrenewing personal risk insurance policies, effective January 1, 2011.

• Requires insurers using credit history in underwriting to file financial history measurement programs with the Insurance Commissioner and provide applicants written disclosure of credit use, with allowances for extraordinary life circumstances (illness, divorce, job loss, identity theft) within three years.

• Establishes rating requirements for private passenger nonfleet automobile insurance, including restrictions on allocating producer commissions and underwriting profits as flat dollar amounts, and mandates territorial classification weighting at 75% individual loss cost and 25% statewide average.

• Restricts motor vehicle insurance surcharges for accidents under $1,000, first property damage accidents, certain traffic violations, and accidents where the insured was not at fault or convicted.

• Requires insurance companies to notify lienholders of policy cancellations, provide detailed constructive total loss valuations to claimants with right to dispute, and increases arbitration award interest from 10% to 15% annually for motor vehicle claim disputes.