'I just think it's a great ruling,' said Michigan Insurance Commission Advocate Melvin 'Butch' Hollowell. 'Credit scoring discriminates against Michigan's middle class. 'With credit scoring, a factory worker in Macomb County who didn't finish high school pays twice as much as a doctor from Grand Rapids with the same driving record.' Generally, the better a person's credit score, the cheaper the premium. One with a worse score usually pays a higher rate. Regulators say the practice is unfair, illegal and disproportionately affects minorities, young people and the poor. Gov. Jennifer Granholm praised the ruling as an 'important step in lowering insurance costs for many Michigan residents.' But Peter Kuhnmuench, executive director of the Insurance Institute of Michigan, defended credit scoring, and said if the ruling is not overturned it could drive up rates for those who have received insurance policy discounts because of a good credit score. 'The use of credit has proven to be an effective and efficient tool to evaluate risk,' said Kuhnmuench who represents 40 of the state's property and casualty insurance companies. The case began in March 2005, when the state Office of Regulatory Reform filed rules with the Secretary of State banning credit scoring. Insurance industry representatives immediately brought suit and a lower court sided with them and allowed credit scoring to continue. In the appellate court ruling the judges wrote: 'Though business and industry arguing for the use of insurance credit scoring invariably assert a correlation between low credit scores and increased frequency of claims... no insurer and or entity conducting studies of credit scoring for insurers has yet to present any data even suggesting, much less proving, that the use of insurance credit scoring results in a reduction of losses.' Detroit News Staff Writer Paul Egan contributed to this report. You can reach Charlie Cain at (517) 371-3660 or at [email protected].