Washington Commissioner’s Draft Rule Would Require Insurers to Explain Premium Changes
Washington Insurance Commissioner Mike Kreidler shared a draft rule that requires all property/casualty insurers selling personal lines of insurance to give policyholders a simple breakdown of the reasons behind any future premium change.
According to a press release from Kreidler, consumers often contact his office when they receive a premium increase and they haven’t been given a clear explanation for the increase.
In many cases, their insurer told them the inability to use credit scoring was driving up their premium, according to the release.
Kreidler has been in a battle with insurers over his new rule banning credit scoring. A judge in Washington in April signed an order formally staying the Kreidler’s ban on using credit ratings to help set insurance premiums on vehicle, rental and homeowners insurance.
In February, the American Property Casualty Insurance Association, along with co-petitioners the Professional Insurance Agents of Washington, and the Independent Insurance Agents and Brokers of Washington, filed a petition in Thurston County Superior Court challenging Kreidler’s permanent rule banning the use of credit-based insurance scoring. The National Association of Mutual Insurance Companies separately filed its own petition, and the court consolidated the cases at the joint request of APCIA, PIA, IIABW and NAMIC.
The APCIA and NAMIC have been reached out to for a comment on Kreidler’s new draft rule.
“If you eat at restaurant or go to the grocery store, you get a receipt showing what you’ve paid for and what made up your total bill,” Kreidler said in a statement. “Why can’t your insurance company tell you the same type of information? There are many factors that determine how much you pay for insurance. You deserve to know what they are and what you can do to get a better rate.”
The proposal in its current form requires insurers provide their policyholders with a “Premium Change Disclosure Notice” that explains the premium change and the dollar amount or percentage of each factors’ impact on their new premium.
Kreidler’s office has scheduled a public meeting on the draft proposal on June 14 at 9 a.m. PST via Zoom.
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