Insurance Commissioner Patty Kuderer’s proposal to study the use of credit scores in insurance underwriting is set to move forward, despite not passing during Washington’s recent legislative session. The study will now be included in the state budget, allowing it to proceed.
This proposal aims to investigate whether credit-based insurance scores unfairly impact certain policyholders and to explore possible alternatives. Kuderer expressed optimism about the inclusion of this study in the budget, noting that it reflects strong support from lawmakers.
In addition to the credit score study, Kuderer is also pushing for legislation that would expand her authority to order restitution from insurers. This bill, which passed the Senate earlier this year, would enable the commissioner to require insurers to compensate policyholders directly for violations of insurance codes. The bill also seeks to impose fines of up to $10,000 per violation for property and casualty carriers, aligning penalties with those already in place for health insurers.
However, the restitution bill faced challenges in the House Consumer Protection and Business Committee, where an amendment capped total fines. Kuderer criticized this change, saying it weakened the bill’s intent. Industry representatives raised concerns that the proposed fines could lead to excessive penalties, which contributed to the bill’s stall.
Despite these setbacks, Kuderer remains hopeful that the restitution bill will return in the next legislative session. Washington operates on a two-year legislative cycle, meaning the measure is still eligible for consideration. Kuderer believes that some lawmakers may reconsider their positions, especially since the bill aims to help consumers recover restitution without resorting to costly legal action.
Kuderer also announced plans to launch a study on a grant program designed to help homeowners and businesses reduce risks associated with disasters. She intends to visit various locations in the state to hear from residents about their insurance concerns and preparedness.
In her broader commentary, Kuderer expressed worries about proposed federal cuts to key agencies like FEMA and NOAA, which could increase risks for consumers. She also highlighted the potential impact of letting health insurance premium tax credits expire, warning that it could lead to 80,000 Washingtonians losing coverage and destabilizing the individual insurance market.
Kuderer emphasized that these decisions are not just about budgets; they directly affect people’s access to insurance and financial protection.