And he argued that the practice "creates wide racial disparities and is fundamentally unfair to consumers."

But, Michael McRaith, Illinois insurance commissioner, took a middle ground, noting that over the years, "insurance regulators have heard arguments and rhetoric, if not diatribe, on both sides of this public policy question."

McRaith, testifying on behalf of the National Association of Insurance Commissioners, said that to deal with this, regulators are continuing to examine both sides of the issue.

"Distinct from the public policy debate, regulators are presently investigating the components of an insurance score, the extent to which any one rating factor affects a consumer, whether consumers have an appropriate understanding of the credit factors that affect a particular insurance policy, and whether insurance score vendors should be subject to enhanced transparency or supervision," McRaith said.

The AIA's Snyder said insurance scoring has contributed to favorable personal lines markets in several ways. One of these, he said, is that it "provides an objective, cost effective risk measurement tool for all components of auto insurance coverage, citing a 2003 actuarial study.

Second, he said, "by providing a comparative and quantitative measure for each risk, it has allowed insurers to move toward pricing which is much more tailored to individual risk, replacing the old system that relied exclusively on large group classifications, such as geographic territory or age."

He also said that it has encouraged insurers to write more coverage because "they have more confidence that they are able to accurately predict and price for all levels of risk."

Anne Fortney, a partner at Hudson Cook LLP, Washington, D.C., also defended the use of credit scoring.

She argued that if an insurer cannot use credit information as a factor in assessing risk in the case of property or casualty insurance, "the insurer's ability to price effectively for risk will be diminished."

The inevitable result, she said, "will be higher premiums for most consumers and less availability of insurance for marginal insurance risks."

She also touched on an argument by critics that the data supports the notion that use of crediting scoring has a higher than average impact on the poor and minorities.

She added that, while each case is different, "it is important to understand that the existence of a disparate impact on a protected group would not, standing alone, constitute a violation of the Fair Housing Act or the Equal Credit Opportunity Act."

She explained that, "Once such a disparate impact is proven, the burden shifts to the defendant to show a legitimate business reason for the use of a policy or practice that caused the disparate impact."