To enact section 3937.022 of the Revised Code to regulate the use of credit scoring in determining rates for motor vehicle insurance and to require the Department of Insurance to study the impact of insurers' use of credit scoring on motor vehicle insurance rates.

Section 1. That section 3937.022 of the Revised Code be enacted to read as follows:

Sec. 3937.022. (A) As used in this section, "credit score" means a numerical value or a categorization determined from a statistical tool or modeling system to predict the likelihood of certain credit behaviors, including default. "Credit score" does not include any mortgage score or rating of an automated underwriting system that considers one or more factors in addition to credit information.

(B) In determining rates for motor vehicle insurance, an insurer may consider credit reports and credit scores in accordance with this section.

(C)(1) No insurer shall refuse to write or renew motor vehicle insurance solely on the basis of an applicant's or insured's credit score or credit report.

(2) No insurer shall consider a credit score or credit report in underwriting motor vehicle insurance unless the credit score was determined or the credit report issued within the prior year.

(3) An insurer that considers credit scores or credit reports in determining rates for motor vehicle insurance shall annually obtain new credit scores and credit reports for each of its insureds. The insurer shall use the updated credit scores and credit reports in determining its insureds' premiums. If spouses are covered under the same policy of motor vehicle insurance, an insurer shall obtain credit scores or credit reports on both spouses, and the better credit score or credit report shall be used in determining the premium for the policy.

(D)(1) If an insurer considers credit reports and credit scores in determining rates for motor vehicle insurance, the insurer shall notify an applicant of its use of credit reports and credit scores, in writing, prior to the issuance of a motor vehicle insurance policy.

(2) If an insurer that does not consider credit reports and credit scores in determining rates for motor vehicle insurance begins to consider these risks in determining rates, the insurer shall promptly notify its insureds, in writing, of this change to its rating system. Premium increases resulting from this change shall be averaged into the premiums of current insureds over a three-year period.

(E) If an insurer groups risks by classifications for the establishment of rates and considers credit scores and credit reports as, or within, any such classification, the insurer shall consider an applicant or insured that is without a credit score or credit report due to a lack of established credit, for underwriting purposes, at the midpoint for this risk factor.

(F) If an insurer refuses to write or renew motor vehicle insurance, an applicant or insured may request information under section 3937.08 of the Revised Code with respect to how a rating organization's or insurer's rating system was applied to the applicant or insured. If credit reports and credit scores were considered in the underwriting decision, the insurer shall provide the applicant or insured with copies of all credit reports and credit scores considered.

(G) No insurer shall increase an applicant's or insured's premium as a result of a request for information on the insurer's use of credit scores and credit reports.

Section 2. The Department of Insurance shall study and issue a report on the impact of insurers' use of credit scoring in determining rates for motor vehicle insurance. The study shall include an assessment of whether the use of credit scoring increases the cost of motor vehicle insurance. If the study finds that the use of credit scoring does increase average motor vehicle insurance premiums, the study shall determine the impact of this increase on the number of uninsured motorists in Ohio. The study shall examine the impact that an increase in Ohio's minimum financial responsibility requirements for the operation of a motor vehicle, in combination with insurers' use of credit scoring, would have on the number of uninsured motorists in Ohio.

The Department shall issue its report, which shall include its findings and any legislative or administrative recommendations, within one year after the effective date of this act. Copies of the report shall be submitted, at the time of its issuance, to the Governor, the Speaker of the House of Representatives, the President of the Senate, the chair of the House of Representatives committee having primary jurisdiction over insurance legislation, and the chair of the Senate committee having primary jurisdiction over insurance legislation.