American Property Casualty Insurance Association: Washington Judge Rules Insurance Commissioner Kreidler Exceeded His Authority by Banning Credit-Based Insurance Scoring

OLYMPIA, Washington, Aug. 1 (TNStalk) -- The American Property Casualty Insurance Association issued the following agency statement on July 30, 2022:

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Judge Indu Thomas ruled that Insurance Commissioner Kreidler exceeded his authority when he issued a permanent rule banning the use of credit-based insurance scores. Judge Thomas granted the industry's Petition for a Declaratory Judgment and invalidated the rule. This is an important victory for consumers as Insurance Commissioner Kreidler's rule disrupted the insurance marketplace for consumers (especially for seniors) raising rates for more than a million Washington policyholders.

After reviewing the industry's and Commissioner's briefs in opposition (which included an amicus brief in opposition submitted by the Consumer Federation of America, Northwest Justice Project, and Northwest Consumer Law Center) and after hearing oral arguments by both sides today, Judge Thomas ruled for the petitioners.

In rendering her decision from the bench, Judge Thomas held that the Commissioner could not rely on the more general rating standard statute that prohibited "excessive, inadequate, or unfairly discriminatory" rates to "eliminate all meaning from the more specific credit history statutes by which the legislature had authorized its use."

This joint quote can be attributed to three trade associations (American Property Casualty Insurance Association, Professional Insurance Agents of Washington, Independent Insurance Agents, and Brokers of Washington) that filed this successful legal challenge.

"We are pleased the court considered our legal arguments and agreed that the Commissioner exceeded his authority when he put forth these regulations to ban the use of credit-based insurance scores for an indefinite time but for no less than three years. Judge Thomas agreed with our arguments that the issues presented a policy choice that is the province of the Legislature."

Per Judge Thomas' instructions following her ruling, petitioners will now prepare a proposed order and confer with the Washington Assistant Attorney General who represented the Washington Insurance Commissioner. Until the final order is entered invalidating the permanent rule, the enforcement and effectiveness of the permanent rule remains stayed pursuant to an order entered earlier in the litigation.

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Original text here: https://www.apci.org/media/news-releases/release/72720/