Two days after Christmas the Delaware Commissioner of Insurance announced his participation, along with twelve other State Insurance Commissioners, in two law suits protesting the use of credit scores in establishing insurance rates.

Delaware Insurance Commissioner Matt Denn has taken arguments against insurance industry use of credit scoring to the U.S. Supreme Court, filing a brief in a pending case involving the practice. Denn recruited 12 other state insurance commissioners to join Delaware in filing the brief. The other state insurance commissioners joining Denn on the brief include those from Arkansas, California, Georgia, Iowa, Kansas, Michigan, Montana, New Mexico, North Dakota, Oklahoma, Utah and Washington.

Denn’s amicus curiae, or “friend of the court,” brief was filed last Monday with the Supreme Court in Washington, D.C. in the cases of Safeco v. Burr and GEICO v. Edo.

The actual consumer plaintiffs in the case in the cases claim that insurance companies Safeco and GEICO violated the federal Fair Credit Reporting Act. The consumers said that when a consumer’s credit information resulted in the consumer receiving a higher rate, insurers should have sent out “adverse action notices” required under FCRA and acted in “willful” disregard of the FCRA in not doing so.

FCRA adverse action notices are sent to consumers by banks, landlords and others when a consumer’s credit report has caused them to be denied for a loan or a lease, for example, or even if a consumer is required to have a higher than usual down payment or deposit due to their credit score, the brief notes.

Denn and the 12 other insurance commissioners told the Supreme Court that they were filing their brief to “further their collective mission of protecting consumers by supporting interpretations of the FCRA that…put valuable information in the hands of consumers, provide appropriate incentives for insurance companies, to adopt procedures that assure compliance with the law, and hold insurance companies accountable when they adopt policies that recklessly disregard consumer rights.”

At the core of this dispute is the fact that, not only can auto insurance companies use your credit score as an index for your premium costs, they don’t have to notify you that credit has adversely affected your insurance costs. If credit scores are costing you money, their use ought to be transparent. It certainly is when you borrow money.