The Rhode Island Department of Business Regulation Insurance Division has published a bulletin notifying insurers that they must cease using non-compliant vehicle history scores. 

“It has come to our attention that some vehicle history scores being utilized by insurers include losses that do not meet the criteria of a Chargeable Accident or that occurred outside the allowed three (3) year look back period,” the bulletin says. “Any rating program that utilizes such a factor is deemed to be in violation of the RI Rating statutes and regulations and insurers should cease using those scores.” 

Code 230-RICR-20-05-3 says that insurance cannot charge a higher premium as a result of any loss for which a surcharge is prohibited. This includes establishing a premium surcharge, penalty, removal of a discount, or declining an award of credits, tier or re-tier, or altering a premium for any losses other than a “Chargeable Accident or Moving Violation.” 

It also says insurers may not establish “loss-free discounts or tiers” that take into account losses that are not Chargeable Accidents or Moving Violations. 

The code states accidents will not be deemed chargeable if an individual can show one of the following: 

• • The accident occurred more than three years prior to the effective date of the policy;
  • The property damage claim payment made as a result of an accident occurring before Jan. 1, 2020, was less than $1,500 or the property damage claim payment made as a result of an accident occurring on or after Jan. 1, 2020, was less than $3,000. 
  • The automobile involved in the motor vehicle accident was legally parked and unattended at the time of the damage;
  • The insured covered by that policy is 50% or less at fault;
  • The owner or operator has received at least 50% reimbursement from the other driver involved in the automobile accident;
  • The individual has received a judgment in a court of law against the other owner or operator involved in the accident for 50% of the loss incurred;
  • There has been a determination by a law enforcement agency that the damage inflicted on the owned or operated vehicle was done by an individual operating a stolen vehicle whether or not that individual was apprehended;
  • The operator or owner of the other vehicle involved in the automobile accident with the insured vehicle has had his license and/or registration suspended by action of the Division of Motor Vehicles for failing to satisfy financial responsibility requirements;
  • The loss or incident involved a bus driver while in the course of his or her employment for the Rhode Island Public Transit Authority or private or municipal school bus companies;
  • The loss involved a law enforcement officer while in the course of his or her employment for state, city, or town police departments;
  • The loss or incident involved a commercial vehicle driver, defined as the driver of a motor vehicle with a gross weight in excess of 10,000 pounds or a motor vehicle used for public livery while in the course of his or her employment; or
  • The loss or incident involved the operator of an emergency vehicle falling within the scope of R.I. Gen. Laws § 45-19-17.

Any insurers not currently compliant with the code must submit a filing to the Division and remove the non-compliant elements no later than Nov. 30, the bulletin says. It also notes these non-compliant rating elements should not be included in future filings. 

Any questions or concerns can be emailed to dbr.insurance@dbr.ri.gov.

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Photo courtesy of Bill Oxford/iStock

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