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HB 5281

AN ACT PROHIBITING INSURANCE COMPANIES FROM USING CREDIT HISTORY AS A FACTOR IN UNDERWRITING OR RATING HOMEOWNERS INSURANCE POLICIES.

2025 Regular Session Introduced by Craig Fishbein and 1 co-sponsor

Connecticut bill prohibits homeowners insurers from using credit history in policy underwriting and rating decisions, potentially lowering costs for lower-credit consumers but raising questions about rate impacts.

REF. TO JOINT COMM. ON Insurance and Real Estate
#creditratings #homeowners'insurance
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Bill Summary · HB 5281

Legislative bill overview

HB 5281 would prohibit Connecticut insurance companies from considering a consumer's credit history when underwriting or rating homeowners insurance policies. The bill removes credit scores as a permissible variable in determining eligibility and premium costs for homeowners coverage. This represents a significant shift in how insurers can assess risk in the residential property insurance market.

Why is this important

Credit-based insurance scores are currently used by most major insurers nationwide to help predict claim likelihood, with studies showing correlations between credit behavior and insurance losses. This bill would eliminate that pricing tool, potentially affecting how insurers calculate premiums and assess risk, which could have downstream effects on insurance availability and cost structures. The change reflects growing concern about whether credit history unfairly burdens lower-income consumers or perpetuates economic disparities in insurance access.

Potential points of contention

  • Insurance industry opposition: Insurers argue credit history is a statistically valid predictor of claims and that removing it may force them to raise rates for all consumers or restrict coverage in certain markets to manage risk
  • Rate impact uncertainty: Unclear whether prohibition would lower premiums for lower-credit consumers or lead to rate increases/coverage denials for broader populations, and whether it affects insurer profitability and market participation in Connecticut
  • Risk assessment alternatives: Debate over whether other underwriting factors adequately replace credit scoring's predictive value, or whether removing it creates adverse selection where riskier applicants disproportionately purchase policies

Compiled from official sources — confirm details with the bill’s official record.

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