The department was instrumental in developing many of the provisions in the measure which was approved (HB 2071) and is scheduled for signing shortly by Gov. Kathleen Sebelius, he said.

The bill, which will go into effect beginning next year, is expected to provide improved communications between agents and their consumers.

"Part of the problem in Kansas has been that the agents didn't have either the training or information to explain the use of credit or insurance scoring to consumers. So it created a communications gap," said Mr. Wells. "And we believe that this bill will alleviate that gap, and consumers will be much better informed about the use of credit scoring."

But Mr. Wells added he doesn't believe the new regulation will decrease the use of credit scoring by insurers.

"Our attitude is that there was a legislative taskforce that was organized in 2002, and their conclusion was that although credit scoring should not be totally banned, it should be controlled and regulated," he said.

For example, his department has mandated in the bill that insurers cannot use credit scoring exclusively in establishing rates. The formulas, the so-called "black box" that insurance companies use to determine insurance scores, has to be filed with the insurance department so that regulators can determine whether those scores discriminate in any unlawful way.

Insurers must also notify their insureds when credit scoring is used in setting their insurance rates.

Mr. Wells explained that the bill won't go into effect until next year so that insurance companies can prepare their internal systems for the new law.

"It will have an immediate effect next year because the increased regulation will have an impact on how the industry uses credit scoring. The insurance department would have more authority with this bill. We feel it's a very consumer-friendly bill," he said.