New York Assembly Bill A05638

New York 2025-2026 Regular Session

• Introduced: 2/18/25
• Refer: 2/18/25
• Refer: 1/7/26

Caption

Directs the superintendent of financial services to promulgate rules and regulations limiting the use of credit scores to determine automobile insurance premiums.

Summary

This bill directs the New York Superintendent of Financial Services to review how automobile insurance premiums are calculated and to adopt rules and regulations that eliminate the use of credit scores, or similar credit-report-based methods, in setting those premiums for New York residents. The bill’s findings state that credit-based insurance scoring can cause premium changes that consumers may not anticipate or be able to control, and that credit scores should not be a decisive factor in auto insurance pricing. If the superintendent determines that insurers currently use credit scores or comparable methods, the bill requires amended regulations that remove those factors from premium calculations. If such methods are not currently used, the superintendent must still issue regulations prohibiting their future use. The bill would take effect 120 days after becoming law, with immediate authorization for any necessary regulatory changes before that date.

Impact

The bill would affect New York insurance regulation by restricting the underwriting and rating factors insurers may use for private passenger auto insurance. It would require the Department of Financial Services to examine actuarial practices and, if necessary, revise rules so that consumer credit information cannot be used to set auto insurance premiums. The practical impact would fall on insurers, policyholders, and the state regulator, potentially changing premium-setting models and removing a factor that can raise or lower rates based on credit history rather than driving-related risk.

Sentiment

Based on the bill text and the absence of recorded committee debate or votes, the measure appears to be framed as consumer-protection legislation aimed at fairness and predictability in auto insurance pricing. The sponsor’s findings present credit scoring as opaque and difficult for consumers to manage, suggesting a generally supportive rationale for limiting its use. No contrary positions are documented in the provided materials, so there is no recorded public opposition or support beyond the bill’s stated intent.

Contention

The main policy contention is whether credit history is a legitimate actuarial predictor of insurance risk or an unfair and hard-to-control factor that should not affect premiums. Supporters would likely emphasize consumer fairness, transparency, and the inability of many drivers to quickly influence their credit score. Opponents, if any, would likely argue that credit-based insurance scoring is a statistically useful underwriting tool and that prohibiting it could reduce pricing accuracy or shift costs among policyholders. No specific stakeholders or objections are identified in the provided record.