Filed Under:Markets, Personal Lines

Credit Scoring Bill Dies In Wisconsin

NU Online News Service, April 28, 10:30 a.m. EDT

A bill opposed by insurers that would have banned credit-based insurance scoring in Wisconsin never made it out of committee before the end of the legislative session.

Lawmakers at the state capital in Madison wrapped up business last Thursday.

John Birkinbine, assistant vice president, Midwest region for the American Insurance Association (AIA), said the credit bill and other industry-opposed measures were introduced early in the session but faded away without much contentious debate as the session progressed.

He attributed this to Democrats in the state taking criticism over a measure passed last year that raised minimum requirements for auto insurance.

Mr. Birkinbine said the minimum requirements measure, which was included in the governor's budget bill along with other insurance-related measures, has raised rates for drivers, leading to a backlash that has included newspaper editorials and criticism from the Republican minority in the Wisconsin legislature.

He said raising the minimum coverage requirements was one of several measures put into the budget bill at the request of trial lawyers.

But Birny Birnbaum, executive director of the Center for Economic Justice (CEJ), said the legislature addressed minimum requirements last year to ensure drivers have adequate coverage. He said in many states, minimum requirements were established years ago and were never increased, and so do not provide adequate coverage today.

He also noted that the legislature's Democratic majority was hit with criticism for passing the measure.

Mr. Birkinbine said he believes the Democrats in the legislature avoided issues like credit scoring as a result of the fire they took for raising minimum auto coverage requirements.

He said AIA was concerned about a credit bill passing since the debate over such a bill was fierce in a previous legislative session. He noted that Democrats had larger numbers in this session as well.

Greg LaCost, Property Casualty Insurers Association of America (PCI) assistant vice president, state government affairs, said the credit issue was contentious early in the legislative session, but he credited the industry with doing a good job of educating the legislature about how using credit-based insurance scores benefits consumers.

PCI said lawmakers also rejected legislation that would have placed restrictions on the use of direct repair options for policyholders' auto body repairs, in addition to other measures such as territorial rating bans and small claims expansion.

Mr. LaCost mentioned that the Assembly also did not act on a medical malpractice measure which would have allowed an adult's parent to bring a lawsuit for loss of society and companionship.

PCI noted the legislature did pass a ban on texting while driving. "Wisconsin joins 23 other states that have prohibitions on texting while driving," PCI said.

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