COMMISSIONER APPEALS CREDIT SCORING DECISION

The state of Michigan has filed an appeal of a judge’s ruling that allowed insurance companies to continue using customers’ credit scores to determine their home and automobile insurance rates. Attorneys for the state, as expected, filed an appeal Monday with the Michigan Court of Appeals.

Barry County Circuit Court Judge James Fisher ruled last month that state Insurance Commissioner Linda Watters overstepped her authority when she filed new rules reducing base rates and barring insurance companies from providing discounts to policyholders with good credit ratings. The insurance industry filed a lawsuit to stop the new rules, which were to take effect July 1. Most large insurers in Michigan use some form of credit scoring. Generally, the better one’s credit score, the lower a customer’s insurance premium will be. One with a worse score usually pays a higher rate.