U.S. House Representative from Michigan Hansen Clarke (D) proposed legislation on July 13, 2012 that would prohibit insurance companies from using credit scores to determine automobile insurance rates.   The bill, H.R. 6129, is titled the “Ban the Use of Credit Scores in Auto Insurance Act,” and was referred to the House Committee on Financial Services.  The bill is co-sponsored by fellow Michigan representative John Conyers Jr. (D) and Mississippi representative Bennie Thompson (D).

The bill amends the Fair Credit Reporting Act to expressly prohibit the use of consumer reports and consumer information in making any determination involving automobile insurance rates for consumers as follows:

No consumer reporting agency may furnish a consumer report or consumer information with respect to any consumer to any person for use in making any decision to underwrite or rate auto insurance, and no person shall use or obtain a consumer report or consumer information with respect to any consumer in connection with the underwriting or rating of any consumer in connection with a transaction involving auto insurance.

H.R. 6129 defines consumer information as “. . . any information from the file of any consumer at a consumer reporting agency, or any product derived from any such information such as consumer credit reports or credit scores or any other risk score or predictor on any consumer.”

According to Representative Clarke’s Facebook page, “The cost of insurance for everyday people is simply too high[.]  We have to end insurance rating factors that are unfair. Companies penalizing citizens for their credit score and other ‘redlining’ practices must end.”