Sec. 559.052. PROHIBITED USE OF CREDIT INFORMATION. (a) An insurer may not:
(1) use a credit score that is computed using factors that constitute unfair discrimination;
(2) deny, cancel, or nonrenew a policy of personal insurance solely on the basis of credit information without considering any other applicable underwriting factor independent of credit information; or
(3) take an action that results in an adverse effect against a consumer because the consumer does not have a credit card account without considering any other applicable factor independent of credit information.
(b) An insurer may not consider an absence of credit information or an inability to determine credit information for an applicant for insurance coverage or for an insured as a factor in underwriting or rating an insurance policy unless the insurer:
(1) has statistical, actuarial, or reasonable underwriting information that:
(A) is reasonably related to actual or anticipated loss experience; and
(B) shows that the absence of credit information could result in actual or anticipated loss differences;
(2) treats the consumer as if the applicant for insurance coverage or insured had neutral credit information, as defined by the insurer; or
(3) excludes the use of credit information as a factor in underwriting and uses only other underwriting criteria.
Added by Acts 2005, 79th Leg., Ch. 728 (H.B. 2018), Sec. 11.020(a), eff. September 1, 2005.
Structure Texas Statutes
Title 5 - Protection of Consumer Interests
Subtitle C - Deceptive, Unfair, and Prohibited Practices
Chapter 559 - Credit Scoring and Credit Information
Subchapter B. Use of Credit Scoring and Credit Information
Section 559.051. Permissible Use of Credit Scoring
Section 559.052. Prohibited Use of Credit Information
Section 559.053. Disclosure to Consumer Regarding Use of Credit Scoring
Section 559.054. Notice of Action Resulting in Adverse Effect
Section 559.056. Indemnification of Agent
Section 559.057. Sale of Policy Term Information by Consumer Reporting Agency Prohibited