| Insurance Article - Credit Scoring for Determining Auto Insurance Rates |
The Financial Services Commission of Ontario (FSCO) issued a reminder in February 2009 to all insurers in Ontario that the use of credit scoring for auto insurance quoting and underwriting is prohibited by law. The reminder followed complaints from consumers who were having difficulty in obtaining auto insurance as insurers were requiring credit information prior to providing a quote. The Insurance Brokers Association of Ontario (IBAO) also made presentations to the FSCO.
Ontario Regulation 664 prohibits the use of financial information and lifestyle as factors in underwriting and risk classification. The factors also include credit history, credit rating, residence history, occupation, profession, employment status and level of income. Insurers must also comply with all other existing legislation such as the Personal Information Protection and Electronic Documents Act (PIPEDA).
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