HB-4593, As Passed House, October 13, 2011

SUBSTITUTE FOR

HOUSE BILL NO. 4593

     A bill to amend 1956 PA 218, entitled

"The insurance code of 1956,"

(MCL 500.100 to 500.8302) by adding chapter 21A.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

CHAPTER 21A

CREDIT INFORMATION AND CREDIT SCORES

Sec. 2151. As used in this chapter:

     (a) "Adverse action" means an increase in any charge for, or a

reduction or other adverse or unfavorable change in the terms of

coverage or amount of, any personal insurance, existing or applied

for.

     (b) "Consumer reporting agency" means any person which, for

monetary fees or dues or on a cooperative nonprofit basis,

House Bill No. 4593 (H-1) as amended October 12, 2011

regularly engages in whole or in part in the practice of assembling

or evaluating consumer credit information or other information on

consumers for the purpose of furnishing consumer reports to third

parties.

     (c) "Credit information" means any credit-related information

derived from a credit report, found on a credit report itself, or

provided on an application for personal insurance. Information that

is not credit-related shall not be considered credit information,

regardless of whether it is contained in a credit report or in an

application, or is used to calculate an insurance score.

     (d) "Credit report" means any written, oral, or other

communication of information by a consumer reporting agency bearing

on a consumer's credit worthiness, credit standing, or credit

capacity that is used or expected to be used or collected in whole

or in part for the purpose of serving as a factor in the rating [

] of personal insurance.

     (e) "Insurance score" means a number or rating that is derived

from an algorithm, computer application, model, or other process

that is based in whole or in part on credit information for the

purposes of predicting the future insurance loss exposure of an

individual applicant or insured.

     (f) "Personal insurance" means property/casualty insurance

written for personal, family, or household use, including

automobile, home, motorcycle, mobile home, noncommercial dwelling

fire, boat, personal watercraft, snowmobile, and recreational

vehicle, whether written on an individual, group, franchise,

blanket policy, or similar basis.

     Sec. 2159. Nothing in this chapter shall be construed to

provide an insured or applicant for insurance with a cause of

action that does not exist in the absence of this chapter.

     Sec. 2161. An insurer shall indemnify, defend, and hold

harmless producers from and against all liability, fees, and costs

arising out of or relating to the actions, errors, or omissions of

a producer resulting from the use of credit information or

insurance scores for the insurer, provided that the producer

follows the procedures and instructions established by the insurer

and complies with all applicable laws and regulations.

     Enacting section 1. Chapter 21A as added by this amendatory

act takes effect January 1, 2012.

     Enacting section 2. This amendatory act does not take effect

unless all of the following bills of the 96th Legislature are

enacted into law:

     (a) House Bill No. 4594.

     (b) House Bill No. 4595.

     (c) House Bill No. 4596.