Lawmakers reintroduce bill to reform auto insurance pricing

House Resolution 336, and would prohibit the use of credit scores and other factors that aren’t related to driving from being used to calculate insurance rates. (2 min. read)

Author

Marcus Amick
June 04, 2025

A measure reintroduced in the U.S. House of Representatives seeks to ban the controversial use of credit scores in determining auto insurance premiums.

The details: The legislation, called the Prohibit Auto Insurance Discrimination (PAID) Act, is being proposed under House Resolution 336, and would prohibit the use of credit scores and other factors that aren’t related to driving from being used to calculate insurance rates.

  • In addition to credit scores, the bill seeks to ban the use of occupations, education level, employment status, gender, ZIP code, census tract, homeownership status, previous insurer, and prior insurance purchase to determine premiums.

  • The measure—reintroduced by representatives Rashida Tlaib of Michigan, Bonnie Watson Coleman of New Jersey, and Mark Takano of California—zeroes in on these factors specifically as being no longer permitted when insurers calculate rates.  

“Auto insurance discrimination continues to keep our residents in the cycle of poverty,” Tlaib said.

How would it work? If enacted, the Federal Trade Commission (FTC) would be charged with ensuring that insurance providers adhere to the new measures—with the ability to impose civil penalties of no less than $2,500 per violation. The FTC would also have the power to issue regulations to hold insurers accountable and prevent attempts to circumvent the law.

Why it matters: Non-driving factors used to determine insurance premiums have long been an issue for some consumers, preventing some from being able to purchase their vehicles of choice or a vehicle at all. 

Between the lines: The move to reintroduce the bill aimed at eliminating non-driving related factors used to determine rates comes as auto insurance costs continue to climb.

  • Since December 2021, car insurance rates have been increasing every month—with rates increasing in 2023 by 12%, and 16.5% in 2024.

  • The surge in insurance rates is expected to continue in 2025—with an anticipated increase of 7.5% over the year.  

Bottom line: With the continuing rise in insurance rates, House Resolution 336 could help ease some of the stress felt by some buyers associated with purchasing a vehicle, helping to drive more sales at the retail level.

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