ASSEMBLY ACTION Initial and Date |SENATE ACTION Initial and Date
Adopted Lost | Adopted Lost
Concurred In Not
|Concurred In Not
Receded Not | Receded Not
Amend the bill as a whole by deleting section 1, renumbering sections 2 through 10 as sections 12 through 20 and adding new sections designated sections 1 through 11, following the enacting clause, to read as follows:
“Section 1. Chapter 686A of NRS is hereby amended by adding thereto the provisions set forth as sections 2 to 11, inclusive, of this act.
Sec. 2. As used in sections 2 to 11, inclusive, of this act, unless the context otherwise requires, the words and terms defined in sections 3 to 8, inclusive, of this act have the meanings ascribed to them in those sections.
Sec. 3. “Adverse action” means a denial or cancellation of, an increase in any charge for, or a reduction or other adverse or unfavorable change in the terms of coverage or amount of, any insurance, existing or applied for, in connection with any policy.
Sec. 4. “Affiliate” means any company that controls, is controlled by, or is under common control with another company.
Sec. 5. “Consumer credit report” means any written, oral or other communication of information by a consumer reporting agency bearing on the credit worthiness, credit standing or credit capacity of an applicant or policyholder, and which is used or expected to be used or collected in whole or in part for the purpose of serving as a factor to determine:
1. Whether to issue, cancel or renew a policy;
2. The amount of the premium for a policy; or
3. Eligibility for any plan for making payments with regard to a policy.
Sec. 6. “Consumer reporting agency” means any person which, for monetary fees, dues, or on a cooperative nonprofit basis, 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 credit reports to third parties.
Sec. 7. “Credit information” means any information that is related to credit and derived from a consumer credit report, found on a consumer credit report or provided on an application for a policy. The term does not include information that is not related to credit, regardless of whether it is contained in a consumer credit report or in an application for a policy, or is used to calculate an insurance score.
Sec. 8. “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 losses or exposure with regard to an applicant or policyholder.
Sec. 9. The provisions of sections 2 to 11, inclusive, of this act do not apply to a contract of surety insurance issued pursuant to chapter 691B of NRS or any commercial or business policy.
Sec. 10. An insurer that uses information from a consumer credit report shall not:
1. Use an insurance score that is calculated using income, gender, address, zip code, ethnic group, religion, marital status or nationality of the consumer as a factor, or would otherwise lead to unfair or invidious discrimination.
2. Deny, cancel or fail to renew a policy on the basis of credit information unless the insurer also considers other applicable underwriting factors that are independent of credit information and not expressly prohibited by this section.
3. Base renewal rates for a policy upon credit information unless the insurer also considers other applicable factors independent of credit information.
4. Take an adverse action against an applicant or policyholder based on the applicant or policyholder not having a credit card account unless the insurer also considers other applicable factors independent of credit information.
5. Consider an absence of credit information or an inability to calculate an insurance score in underwriting or rating a policy unless the insurer treats the applicant or policyholder as having neutral credit information, as defined by the insurer.
6. Take an adverse action against an applicant or policyholder based on credit information, unless an insurer obtains and uses a credit report issued or an insurance score calculated within 90 days from the date the policy is first written or renewal is issued.
7. Except as otherwise provided in this subsection, use credit information regarding a policyholder without obtaining an updated consumer credit report regarding the policyholder and recalculating the insurance score at least once every 36 months. An insurer does not need to obtain an updated consumer credit report for a policyholder if:
(a) The insurer is treating the policyholder as otherwise approved by the Commissioner.
(b) The policyholder is in the most favorably-priced tier of the insurer and all affiliates of the insurer.
(c) Credit information was not used for underwriting or rating the policyholder when the policy was initially written.
(d) The insurer reevaluates the policyholder at least once every 36 months based upon underwriting or rating factors other than credit information.
8. Use the following as a negative factor in any insurance scoring methodology or in reviewing credit information for the purpose of underwriting or rating a policy:
(a) Credit inquiries not initiated by the applicant or policyholder, or inquiries requested by the applicant or policyholder for his or her own credit information.
(b) Inquiries relating to insurance coverage, if so identified on the consumer credit report.
(c) Collection accounts relating to medical treatment, if so identified on the consumer credit report.
(d) Multiple lender inquiries, if identified on the consumer credit report as being related to home loans or mortgages and made within 30 days of one another, unless only one inquiry is considered.
(e) Multiple lender inquiries, if identified on the consumer credit report as being related to a loan for an automobile and made within 30 days of one another, unless only one inquiry is considered.
(f) Any credit information that does not reflect the usual credit activity of the applicant or policyholder.
Sec. 11. Before December 31 of each even-numbered year, the Commissioner shall prepare a report to the Governor and the Legislature. The report must address:
1. The operation of sections 2 to 11, inclusive, of this act;
2. The efficacy, necessity and desirability of using credit information in making decisions related to insurance;
3. The impacts upon the residents of Nevada of the continued use of credit information in making decisions related to insurance; and
4. Any additional consumer protections identified by the Commissioner for the consideration of the Legislature.”.
Amend the title of the bill by deleting the first and second lines and inserting:
“AN ACT relating to insurance; restricting the use by an insurer of information included in the consumer credit report of an applicant or policyholder as a basis for making certain determinations and taking certain actions regarding policies of”.