Insurers Using Consumer Reports Must Send Adverse Action Notices

The Ninth Circuit Court of Appeals reversed a lower court and issued ruling stating that when insurers offer applicants and current customers less favorable rates because of their consumer report, they must send an adverse action notice.

This is true no matter how good the credit report was, IF the rate would have been EVEN BETTER, with a BETTER consumer report.

Or if the consumer report is NOT considered.

Or if it is NOT AVAILABLE.

So there's going to be a lot of adverse action notices flying around out there.

The basis of the ruling is the insurance company's obligations under the Fair Credit Reporting Act.

SEE:

Reynolds v. Hartford Financial Services Group, 2005 U.S. App. LEXIS 16076 (9th Cir. 2005)