A Louisiana Senate bill that would ban insurer use of creditinformation to rate customers failed in committee today, but ameasure with a more limited credit scoring ban remained alive inthe House this afternoon.

Defeated in the Senate Insurance Committee by a 3-1 vote was abill to repeal present law and prohibit use of credit scoring andinformation concerning a person's credit-worthiness in determiningwhether or not to issue or renew a policy or personal liabilityinsurance.

The bill, SB 436, would have allowed use of credit scores todetermine interest rates on financing of premium payments.

Meanwhile, the House was scheduled to work into the evening on along agenda that included HB 318, designed to shieldhurricane-impacted residents from credit scoring, which would onlybar use of credit scoring information from 2005.

That measure just passed the House Insurance Committee earlierthis week on a 7-6 vote. It was introduced by Rep. Cedric Richmond,D-New Orleans.

According to the language of HB 318, insurers would be barredfrom using any 2005 credit information “to underwrite or rate risksfor any person who resided in an area that was gubernatoriallydeclared to be in a state of disaster or emergency during” lastyear.

The American Insurance Association has voiced concern over thebill, which it says could harm consumers who improved their creditduring 2005. AIA said that the bill's goal of easing the strain onvictims of Hurricane Katrina has already been met by a directivefrom the state insurance commissioner.