Thurston County Superior Court Judge Indu Thomas overturned Washington Insurance Commissioner Mike Kreidler’s ruling to end the use of credit scoring for insurance rates.
According to a Washington state Office of the Insurance Commissioner press release, Kreidler will not appeal the court’s decision.
Thomas found Kreidler had exceeded his authority as insurance commissioner in adopting a rule to temporarily ban credit scoring when a specific state statute allows insurers to use credit scoring.
In February, Kreidler called the use of credit scores racist as it hurt people of color. He then issued a temporary ruling banning their use. Insurance companies filed suit, and Thomas put a hold on Kreidler’s ruling, which was set to start March 4.
Thomas overturned the ruling July 29, but supported its intent and consumer protections.
“The record reflects and the court does not question whether that rule protects Washington residents who are entitled to be free of improper discrimination in how their insurance rates are set,” Thomas said during the ruling. “It is well established that there is an undeniable link between race and poverty, and any policy that discriminates based on credit worthiness correspondingly results in a disparate impact on communities of color. The temporary rule does in fact protect from such discrimination.”
