ARIZONA HOUSE OF REPRESENTATIVES

Fifty-sixth Legislature

First Regular Session

House: COM DP 8-2-0-0

☐ Prop 105 (45 votes) ☐ Prop 108 (40 votes) ☐ Emergency (40 votes) ☐ Fiscal NoteHB 2065: home insurers; discrimination; prohibition

Sponsor: Representative Carter, LD 15

Caucus & COW

Overview

Excludes age as a factor used to calculate an insurance score.

History

An insurance score is a designation that is derived by using a variety of data sources, including an individual's consumer report in an algorithm, computer program, model or other process that reduces the data to a number, alpha character or rating that is used for insurance underwriting and rating decisions (A.R.S. § 20-2101).

When calculating an insurance score to determine property or casual premiums for insurance transactions, insurers are prohibited from using the following types of credit history: 1) the absence of a credit history; 2) credit histories or insurance scores based on collection accounts identified with a medical industry code; 3) a bankruptcy or lien that exceeds seven years; 4) the consumer's use of a specific credit card or debit card; 5) the consumer's cumulative available line of credit with the exception of outstanding debt; 6) an insurance score that is calculated using income, gender, address, zip code, ethnic group, religion, marital status or nationality of the consumer. However, an insurer is permitted to use the consumer's zip code, address, gender and marital status for underwriting purposes (A.R.S. § 20-2110).

Insurers use insurance scores primarily in underwriting and rating of consumers. Underwriting is the process by which the insurer determines whether a consumer is eligible for coverage and rating is the process that determines how much premium to charge a consumer (NAIC).

Provisions

1.   Prohibits an insurer from calculating an insurance score or using an insurance score calculated by a third-party if such score used age as a factor. (Sec. 1)

2.   Permits an insurer to use age for underwriting purposes. (Sec. 1)

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6.                     HB 2065

7.   Initials PRB           Page 0 Caucus & COW

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