SENATE COMMITTEE ON JUDICIARY

 

 

February 13, 2003                                                                                               Hearing Room 343

8:00 a.m.                                                                                                                         Tapes 27-28

 

MEMBERS PRESENT:         Sen. John Minnis, Chair

Sen. Ginny Burdick, Vice-Chair

Sen. Ted Ferrioli

Sen. Charlie Ringo

Sen. Charles Starr

Sen. Vicki Walker

 

 

STAFF PRESENT:                 Bill Joseph, Counsel

Jane Bodenweiser, Committee Assistant

 

 

MEASURE/ISSUES HEARD:           SB 260 Public Hearing

                                                SB 280 Public Hearing

 

 

These minutes are in compliance with Senate and House Rules.  Only text enclosed in quotation marks reports a speaker’s exact words.  For complete contents, please refer to the tapes.

 

TAPE/#

Speaker

Comments

Tape 27, A

005

Chair Minnis

Calls the meeting to order at 8:10 a.m. and opens a public hearing on SB 260.

SB 260 – PUBLIC HEARING

009

Sen. Charlie Ringo

Senate District 17. Testifies in support of SB 260 which prohibits insurer from using credit history or insurance score of consumer applying for or renewing personal property or casualty insurance when making underwriting or rating decision.  Submits testimony of Chet Petersen, Prineville, Oregon (EXHIBIT A).

049

Chair Minnis

Closes the public hearing on SB 260 and opens a public hearing on SB 280.

SB 280 – PUBLIC HEARING

052

Sen. Rick Metsger

Senate District 26.  Submits testimony and testifies in support of SB 280 that establishes requirements for use of credit history in personal insurance underwriting and rating (EXHIBIT B).

099

Sen. Walker

Advocates approval of this bill.

108

Chair Minnis

Closes the public hearing on SB 280 and re-opens the public hearing on SB 260.

SB 260 – PUBLIC HEARING

112

Joel Ario

Department of Consumer and Business Services, Insurance Division.  Submits testimony and testifies as neutral on SB 260 (EXHIBIT C).

296

Chair Minnis

Asks how consumer complaints are being handled.

300

Ario

Explains the process.

320

Chair Minnis

Asks if there has been an increase in complaints in the last six months.

328

Ario

Says there has been a general growth in the number of complaints.

344

Chair Minnis

Asks if consumers are referred to the credit bureaus.

352

Ario

Says, yes.

364

Sen. Ferrioli

Asks about risk behavior and credit scores.

377

Ario

States there is a statistical correlation between the two.

436

Chair Minnis

Asks how factors are weighted.

440

Ario

Talks about the importance of numerous variables.

458

Rae Taylor

Actuary, Department of Consumer and Business Services, Insurance Division.  Discusses relationship between credit scores and insurance rates.

TAPE 28, A

041

Sen. Ferrioli

Wonders about statistics.  Doesn’t see the correlation between credit scores and risk behaviors.

080

Chair Minnis

Asks about the validity of the correlation.

095

Taylor

Says the statistics show a valid correlation.

103

Ario

Continues the discussion on valid statistical profiles.

130

Sen. Starr

Asks how other states are dealing with this issue.

138

Ario

Says Oregon is in the mainstream.

157

Sen. Ringo

Reads an email from a constituent who had her insurance rates increased due to her long-term illness, and wonders about the fairness.

182

Ario

Responds to the email with regard to fairness.

198

Sen. Ringo

Asks if other states prohibit the use of credit scores.

202

Ario

Cites the states that ban credit scoring.

212

Sen. Ringo

Asks if the insurance industry is operating fine in those states.

214

Ario

Replies, yes.

240

Sen. Ringo

Asks what has been done to compel the insurance companies to comply with the Fair Credit Reporting Act.

242

Ario

Says it is not yet state law.

260

Sen. Ferrioli

States his opinion on credit reports and wonders how they can be kept from being used in a discriminatory way.

290

Ario

Says SB 280 takes care of that problem.

302

Sen. Ferrioli

Wonders how an applicant could be certain that their credit information is not being used for risk rating.

321

Ario

Says only if a credit report is not available to the insurance carrier.

355

Sen. Ferrioli

Believes this legislation needs to be reworked.

384

Sen. Walker

Asks if insurance companies have a right to cancel insurance.


 

390

Ario

Explains that they cannot without a reason, but there are many grounds for cancellation.

399

Sen. Walker

Offers a scenario and wonders about cancellation.

410

Ario

Repeats that cancellation has to have a reason.

TAPE 27, B

016

Mildred Brown

Oregon Resident.  Testifies in support of SB 260.  Provides personal experience.

092

Sen. Ringo

Asked what the agent told her about her insurance rate increase.

093

Brown

Says he was not sure why.

094

Sen. Ringo

Wonders if it was because she had too much available credit.

101

Brown

Says that is what the agent believed was the reason.

107

Mike Mitchell

Private Citizen, Hillsboro, Oregon. Submits testimony and testifies in support of SB 260 (EXHIBIT D).

240

Selena King

Private Citizen.  Submits testimony and testifies in support of SB 260 (EXHIBIT E).

345

Vice Chair Burdick

Asks how long insurance companies have been using credit records.

349

King

Says since 1999.

363

Vice Chair Burdick

Asks if it is legal to raise rates because of age.

365

King

Replies that they do go up some, but not dramatically.

386

Chair Minnis

Wonders about rates based on age, sex, and race.

450

Colleen Whitwell

Private Citizen.  Submits testimony and testifies in support of SB 260 (EXHIBIT F).

TAPE 28, B

047

Sen. Ringo

Contends that there are a number of problems with the practice of credit scoring and insurance risk rating.

075

Steve Stratton

Retired private citizen.  Testifies in support of SB 260.  Talks about credit ratings being a flawed system.

181

Walt Nichols

Private citizen, Portland, Oregon.  Testifies in support of SB 260.  Talks about his personal experience.

240

Brad Gritters

Private citizen. Testifies in support of SB 260.

272

Herman Leder

Private citizen.  Submits testimony and testifies in support of SB 260 (EXHIBIT G).

351

Lou Beres

Executive Director, Christian Coalition.  Testifies in support of SB 260.

428

Chair Minnis

Closes the public hearing on SB 260 and adjourns the meeting at 10:00 a.m.

 


 

EXHIBIT SUMMARY

 

A – SB 260, written testimony submitted by Sen. Charlie Ringo on behalf of Chet Peterson,

       6 pp                                                                                                         

B – SB 280, written testimony submitted by Senator Rick Metsger, 18 pp

C – SB 260, written testimony submitted by Joel Ario, 17 pp

D – SB 260, written testimony submitted by Mike Mitchell, 2 pp

E – SB 260, written testimony submitted by Selena King, 1 p

F – SB 260, written testimony submitted by Colleen Whitwell, 1 p

G – SB 260, written testimony submitted by Herman Leder, 4 pp

H – SB 260, written testimony submitted by Sen. Charlie Ringo, 7 pp