In September, the Massachusetts Association of Insurance Agents (MAIA) launched a campaign to ban the use of credit score and other socioeconomic factors in determine the price of insurance coverage. The campaign was endorsed by Attorney General Martha Coakley, and MAIA had a goal of gathering some 70,000 signatures to ensure the issue was on the ballot for the next legislative session. Faced with mounting legal costs and pleas from legislators, MAIA has withdrawn its ballot initiative and will pursue an alternative method of bringing the issue before the Legislature.
MAIA officials claim that the ballot initiative would have been far too time consuming to be viable and the matter would have remained unresolved for years while the ballot went through a convoluted approval process. The group will now be pursuing a legislative path in supporting Senate Bill 461, which has been amended to include a ban on using socioeconomic factors to price insurance policies.
MAIA maintains that state insurers have been using credit score to impose high prices on consumers with poor credit history. The group asserts that such a factor has little bearing on the financial abilities of individuals as a bad credit score may be the result of situations that could not be controlled, such as the 2008 recession. Insurers opposition the initiative note that credit score is one of many factors that are considered when pricing insurance, and that such a factor exists solely to give stability to prices within the market.
