The White House has indicated President Bush plans to sign the renewal of the Fair Credit Reporting Act (FCRA) passed last week by Congress. The legislation renews the current federal credit reporting preemptions that form the basis of the national credit reporting system. Included in the final bill are provisions giving consumers the right to obtain free copies of their credit reports each year and preventing companies from sharing some sensitive medical information and other customer information based on information shared by affiliated businesses. However, institutions could continue to solicit consumers with whom they have a "preexisting business relationship," and the legislation expands the definition "pre-existing business relationship" in a way that that could allow more businesses to continue soliciting consumers despite provisions in the bill enabling consumers to opt-out. House Republican staff negotiators had pushed for the expansion.

The Federal Trade Commission (FTC) in consultation with the Department of Housing and Urban Development is required to conduct a study on the effects of the use of credit scores and credit-based insurance scores on the availability and affordability of financial products and services.

What It Means to Agents: In all, this is positive. The bill strengthens consumer identity theft protections and the expanded "pre-existing business relationship" definition is favorable to business. But the requirement for an FTC study on the effects of credit scores and credit-based insurance scores was fought bitterly by carrier groups. As is always the case with major legislation, passage of a bill by Congress ends only one part of the process. Now, the details on implementation are worked out in the regulatory process.