SB507: SB507 Underwriting and Rate Risking; use of credit information and credit scores in underwriting, rating risks, adverse actions, or certain other actions by insurance companies; prohibit

26 LC 46 1390 Senate Bill 507 By: Senators Parkes of the 7th, Orrock of the 36th, Jones II of the 22nd, Mangham of the 55th, Anderson of the 43rd and others A BILL TO BE ENTITLED AN ACT To amend Article 4 of Chapter 24 of Title 33 of the Official Co de of Georgia Annotated,1 relating to underwriting and rate risking, so as to prohibit the use of credit information and2 credit scores in underwriting, rating risks, adverse actions, o r certain other actions by 3 insurance companies; to prohibit adverse actions against consumers in certain circumstances;4 to provide for related matters; to provide for an effective dat e and applicability; to repeal5 conflicting laws; and for other purposes.6 BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:7 SECTION 1.8 Article 4 of Chapter 24 of Title 33 of the Official Code of Geo rgia Annotated, relating to9 underwriting and rate risking, is amended by revising Code Sect ion 33-24-90, relating to10 definitions, as follows:11 "33-24-90.12 As used in this article, the term:13 (1) 'Adverse action' shall mean a denial or cancellation of, an increase in any charge for,14 or a reduction or other adverse or unfavorable change in the terms of coverage or amount15 S. B. 507 - 1 - 26 LC 46 1390 of any insurance, existing or applied for, in connection with the underwriting of personal16 insurance.17 (2) 'Affiliate' shall mean any company that controls, is controlled by, or is under common18 control with another company.19 (3)(2) 'Applicant' shall mean an individual who has applied to be covered by a personal20 insurance policy with an insurer.21 (4)(3) 'Consumer' shall mean an insured whose credit information is used or whose22 insurance score is calculated in the underwriting or rating of a personal insurance policy23 or an applicant for such a policy.24 (5)(4) 'Consumer reporting agency' shall mean any person that, for monetary fees, dues,25 or on a cooperative nonprofit basis, regularly engages in whole or in part in the practice26 of assembling or evaluating consumer credit information or othe r information on27 consumers for the purpose of furnishing consumer reports to third parties.28 (6)(5) 'Credit information' shall mean any credit related information derived from a credit29 report or found on a credit report utilized by an insurer or used by an insurer to calculate30 an insurance score for personal insurance. Information that is not credit related shall not31 be considered credit information, regardless of whether it is contained in a credit report32 or in an application, or is used to calculate an insurance score.33 (7)(6) 'Credit report' shall mean any written, oral, or other communication of information34 by a consumer reporting agency bearing on a consumer's credit w orthiness, credit35 standing, or credit capacity which is used or expected to be used or collected in whole or36 in part for the purpose of serving as a factor to determine personal insurance premiums,37 eligibility for coverage, or tier placement.38 (8)(7) 'Insurance score' shall mean a number or rating that is derived from an algorithm,39 computer application, model, or other process that is based in whole or in part on credit40 information for the purposes of predicting the future insurance loss exposure of an41 individual applicant or insured.42 S. B. 507 - 2 - 26 LC 46 1390 (9)(8) 'Personal insurance' shall mean private passenger automobile, homeowners,43 motorcycle, mobile homeowners, and noncommercial dwelling fire insurance policies44 and boat, personal watercraft, snowmobile, and recreational veh icle policies. Such45 policies must be individually underwritten for personal, family , or household use. No46 other type of insurance shall be included as personal insurance for the purpose of this47 article."48 SECTION 2.49 Said article is further revised by repealing Code Section 33-24-91, relating to use of credit50 information to underwrite or rate risks, in its entirety and en acting a new Code51 Section 33-24-91 to read as follows:52 "33-24-91.53 (a) No insurer, agent, rating organization, or other entity in the insurance industry shall use54 a credit report, insurance score, or other credit information f rom a consumer reporting55 agency or other entity for any purpose related to:56 (1) Underwriting;57 (2) Eligibility for coverage;58 (3) The categorization of an insured;59 (4) Risk rating;60 (5) Pricing;61 (6) The application of surcharges or discounts;62 (7) Policy cancellations or nonrenewals; or63 (8) Any other practice that affects the premium or availability of personal insurance. 64 (b) No insurer shall take any adverse action against a consumer based in whole or in part65 on:66 (1) Credit information;67 (2) Insurance score; or68 S. B. 507 - 3 - 26 LC 46 1390 (3) The absence of a credit history.69 (c) Insurers shall not use any variable, algorithm, or model that functions as a proxy for70 credit information.71 (d) Insurers shall not request or credit reports for purposes related to personal insurance."72 SECTION 3.73 Said article is further amended by repealing Code Sections 33-24-92 through 33-24-98.74 SECTION 4.75 This Act shall become effective July 1, 2026, and shall apply t o all applicable policies,76 contracts, and certificates executed, delivered, issued for delivery, or renewed in this state77 on or after October 1, 2026.78 SECTION 5.79 All laws and parts of laws in conflict with this Act are repealed.80 S. B. 507 - 4 -