Some states consider limiting credit scores in auto insurance rates

Auto insurers may use a credit-based insurance score (CBIS), distinct from a FICO score that ranges from 300 to 850, to help set premiums. FICO reports that 95 percent of auto insurers use CBIS in states that permit it. Beth Swanson of The Zebra says a CBIS draws on payment history, outstanding debt, length of credit history, new credit inquiries and credit mix, and that lower credit scores correlate with higher claims risk. Most states allow the factor alongside driving record, ZIP code and claims history. Janet Ruiz of the Insurance Information Institute says a driver with an otherwise identical risk profile but a poor insurance score could pay several hundred dollars more each year. Taylor Kovar says both scores can move in a similar direction and many people only notice an insurance score at renewal. California, Hawaii, Massachusetts and Michigan prohibit or significantly restrict CBIS use; Maryland, Utah and Oregon have certain limitations. West Virginia introduced a ban across personal lines; Rhode Island held a prohibition bill for further study. Iowa's early 2026 bill died in committee in May; New York, Oklahoma and Pennsylvania have active bills. Swanson ties the interest to affordability and non-driving factors. Dennis Shirshikov says supporters believe removing CBIS could raise premiums for those whose credit now earns lower rates. Insurance scoring is regulated at the state level.