| REVIEW REQUIREMENTS
| REFERENCE | DESCRIPTION OF REVIEW
STANDARDS REQUIREMENTS
| LOCATION OF
STANDARD IN FILING |
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GENERAL REQUIREMENTS
FOR ALL FILINGS | |
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ELECTRONIC FILINGS |
Insurance Bulletin 360
Title 24-A § 2304-A Rate filings
Title 24-A § 2412 Filings, approval of forms |
Maine requires that all rate and form filings be filed electronically through the NAIC’s System for Electronic Rate and Form Filings (SERFF). See also Bureau of Insurance Bulletin 360 Electronic Submissions of Rate and Form Filings. |
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| COVER LETTER |
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Cover letters may be attached to the Supporting Documentation Tab or the text entered under the Filing Description located under the General Information tab in SERFF |
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| EFFECTIVE DATE |
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Policies effective at 12:01 AM Standard Time
Include proposed effective date on SERFF General Information |
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| LIMITATIONS/RESTRICTIONS ON TRANSACTING BUSINESS |
Title 24-A - §404. Certificate of authority required; enforcement; penalty |
Must have certificate of authority to transact business |
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| LINE OF AUTHORITY |
Workers’ Compensation |
Must have requisite certificate of authority to transact business before submitting rate/rule/form filings |
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| FILING EXEMPTIONS |
Title 24-A - §2412-A. Large commercial contracts |
Large commercial risks exempt from filing—refer to statute for criteria and definition of large commercial risk |
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| THIRD PARTY FILERS AUTHORITY |
Title 24-A - §2412. Filing, approval of forms
Title 24-A - §2304-A. Rate filings |
Must include authorization to communicate directly with third party filers |
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| APPORTIONMENT OF PREMIUM
| Rule Chapter 550 Apportionment of Premium | If the policy also covers risks other than Maine exposure, its premium shall be calculated as follows: all Maine exposure must be accurately measured and subject to a separately itemized charge calculated on the basis of the Maine rate. The remainder of the premium must be calculated in a manner that is reasonably designed to reflect the employer's exposure under the worker's compensation laws of other states. |
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| ARBITRATION |
Title 39-A - §314. Arbitration
Title 24-A - §2433. Jurisdiction of courts, limitation of actions | Any workers' compensation claims reaching the hearing stage may go to arbitration if mutually agreed to in writing by the parties. No conditions, stipulations or agreements in a contract of insurance shall deprive the courts of this State of jurisdiction of actions against foreign insurers, or limit the time for commencing actions against such insurers to a period of less than 2 years from the time when the cause of action accrues.
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| BANKRUPTCY PROVISION
| Title 24-A - §2903. Liability absolute when loss occurs
Title 24-A - §2904. Judgment creditor may have insurance; exceptions
Title 39-A - §102(19). Definitions |
This applies to the Employer Liability portion of workers' compensation coverage. The liability of the insurer is absolute when covered loss occurs. It is not dependent on a judgment against the insured. Judgment creditor may bring reach and apply action against the liability insurer. Any policy used for proof of payment shall guarantee that claimants will be paid their benefits in full. |
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| CANCELLATION |
Title 24-A - §2908(5)(A). Cancellation and nonrenewal
Title 39-A - §403(1). Insurance by assenting employer; requirements as to self-insurers | Notice of cancellation must be in writing and given to the insured and to the Maine Workers' Compensation Board at least 30 days in advance. The effective date and the reason for cancellation must be stated on the notice.
If the insured has obtained another workers' compensation insurance policy and that policy becomes effective prior to the expiration of the 30 day notice period, the cancellation takes effect on the effective date of the other insurance policy. | |
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CANCELLATION, PERMISSIBLE REASONS FOR | Title 24-A - §2908(2). Cancellation and Non-Renewall | An insurance contract may only be cancelled by an insurer prior to the expiration of the policy for one or more of the following grounds:
- Nonpayment of premium
- Fraud or material misrepresentation
- Substantial change in the risk which increases the risk of loss
- Failure to comply with reasonable loss control recommendations
- Substantial breach of contractual duties, conditions or warranties
The Superintendent determines that continuation of a class or block of business will jeopardize a company's solvency or will place the insurer in violation of the insurance laws. | |
| DIVIDENDS | Title 24-A - §2382-A. Payment of dividends | Payment of dividends is neither prohibited nor regulated except that dividend payments may not be unfairly discriminatory between policyholders.
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| DUTY TO DEFEND
| Standard Workers' Compensation and Employer's Liability Insurance Policy, Part One C | The insurer has the right and duty to defend at their expense any claim, proceeding or suit against an insured for benefits payable by the insurance. The insurer has no duty to defend a claim, proceeding or suit that is not covered by the insurance. |
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| EFFECTIVE DATE WORDING |
Insurance - Bulletin 238 | Filings are not approved retroactively. No filings are approved or made effective during the 30 day period after they are received by the Bureau. Insurers should factor into the effective date seven days mailing time for the filing to reach the Bureau and seven days mailing time to receive the response. After this time period, filings are considered to be approved unless they have been disapproved, suspended, or there are questions regarding the filing and responses have not been received from the insurer. | |
| FILING FEES | Title 24-A - §601. Fee schedule |
Filing fees are $20 for rate filings, rating rules filings, insurance policy, forms, and endorsements. | |
| FILING MATERIALS: COVER LETTER, COPIES OF THE FILING, EXPLANATORY MEMORANDUM, AND, RETURN ENVELOPES | Insurance - Bulletin 238 | A filing shall include four copies of the cover letter, a single copy of the filing materials and supporting documents, and two legal size self-addressed stamped envelopes.
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| LINE OF AUTHORITY
| Insurance - Bulletin 238 | This is the annual statement line of business which will be used to report the experience related to the filing on page 14 of the annual statement. |
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| NON-RENEWAL | Title 24-A - §2908(5)(B). Cancellation and Non-Renewal |
Notice of Non-renewal must be in writing and be given to the insured at least 30 days in advance. If notice is provided and the insurer extends the policy for 90 days or less, an additional notice of non-renewal is not required. | |
| NON-RENEWAL, PERMISSIBLE REASONS FOR | Title 24-A - §2908. Cancellation and nonrenewal | There are no restrictions listed for reasons for non-renewing a policy.
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| PARTICIPATING POLICIES
| Title 24-A - §2382-A. Payment of dividends | Nothing in this Act prohibits or regulates the payment of dividends, savings or unabsorbed premium deposits allowed or returned by insurers to their policyholders, members or subscribers, but in the payment of such dividends there may be no unfair discrimination between policyholders. |
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| PAYMENT OF TIME LOSS PERIOD |
Title 39-A - §205(2). Benefit payment | The first payment of compensation for incapacity under Title 39-A, Section 212 or 213 is due and payable within 14 days after the employer has notice or knowledge of the injury or death, on which date all compensation then accrued must be paid. Subsequent incapacity payments must be made weekly and in a timely fashion. Reports shall be furnished to the Maine Workers' Compensation Board as required. | |
| PRIVACY NOTICE | Title 39-A - §109. Compilation of claims information |
Listing of employee names and their claim information may not be compiled for distribution or sale. | |
| RESIDUAL MARKET | Title 24-A - §3708. General powers | Develop and file with the superintendent for review and approval a plan of operation and any amendments to a plan of operation necessary or suitable to ensure the fair, reasonable and equitable administration of the company.
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| RESPONSES TO BUREAU INQUIRIES
| Insurance - Bulletin 238
Title 24-A - §220(2). Investigation of violations
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Responses to Bureau inquiries should include three copies of the response letter and an additional self-addressed stamped envelope. All insurers and other persons required to be licensed pursuant to this Title shall respond to all lawful inquiries of the superintendent not related to consumer complaints within 30 days of receipt. | |
| SUBROGATION | Title 39-A - §354(2). Multiple injuries; apportionment of liability Title 39-A - §107. Liability of 3rd persons; subrogation |
The insurer providing coverage at the time of the last injury shall initially be responsible to the injured employee for all benefits payable under Title 39-A of the Maine Workers' Compensation Act. The Maine Workers' Compensation Board determines apportionment issues among responsible insurers. Subrogation when a compensable injury is caused by a third party. | |
| THIRD PARTY FILERS AUTHORITY | Insurance - Bulletin 238 |
Filings made by consultants or managing general agents on an insurer's behalf must include a letter from an officer of the insurance company authorizing the filer to make the filing. | |
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TRANSMITTAL FORM | Insurance - Bulletin 238 | A Bureau of Insurance Property/Casualty Filing Transmittal Form must be attached to the cover letter.
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| FORMS FILING REQUIREMENTS
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| AMBIGUOUS & MISLEADING |
Title 24-A - §2413(1)(B). Grounds for disapproval | Insurance policies may not be issued unless policy forms have been filed and approved by the Bureau. Forms include endorsement or renewal forms and application forms if it is required and made a part of the policy or contract. Forms shall be disapproved by the Superintendent if they contain or incorporate by reference any inconsistent, ambiguous or misleading clauses. They will also be disapproved if they have deceptive exceptions or conditions or have titles, headings, or provisions which are misleading. |
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| APPLICATIONS |
Title 24-A - §2412(1)(A)(2). Filing, approval of forms | An application form if a written application is required and is made a part of the policy or contract. | |
| EMPLOYER'S LIABILITY | Title 24-A - §2413. Grounds for disapproval |
Insurance policies may not be issued unless policy forms have been filed and approved by the Bureau. Forms include endorsement or renewal forms and application forms if it is required and made a part of the policy or contract. Forms shall be disapproved by the Superintendent if they contain or incorporate by reference any inconsistent, ambiguous or misleading clauses. They will also be disapproved if they have deceptive exceptions or conditions or have titles, headings, or provisions which are misleading. | |
| FORM AND MANNER OF FILING | Title 24-A - §2382-C(2). Filing of rates and other rating information; filing of forms |
If a filing is not accompanied by information required by the Superintendent of Insurance, the Superintendent shall notify the insurer that the filing is not made until the information is provided. | |
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FRAUD WARNING | Title 24-A - §2186(3). Insurance fraud prevention | Applications and insurance claim forms must contain the following information: "It is a crime to knowingly provide false, incomplete or misleading information to an insurance company for the purpose of defrauding the company. Penalties may include imprisonment, fines or a denial of insurance benefits."
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| GROUNDS FOR DISAPPROVAL OF FORMS
| Title 24-A - §2413(1). Grounds for disapproval Title 24-A - §2414. Standard provisions, in general | Any form filed under Title 24-A, Section 2412 shall be disapproved, or withdrawn if previously approved, if it violates Title 24-A. The form is not in compliance if it contains clauses that are inconsistent, ambiguous or misleading. Additionally, the form is not in compliance if it contains exceptions or conditions that are deceptive or has titles, headings and provisions that are misleading.
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| MINIMUM STANDARDS FOR CONTENT (POLICIES AND STANDARD FORMS)
| Title 24-A - §2901. Contracts subject to general provisions Title 39-A - §102(19). Definitions | Contracts are subject to provisions of Chapter 27 (the insurance contract) and other provisions of Title 24-A.
Any policy used for proof of coverage guarantees that claimants will be paid their benefits in full. | |
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POLICY FORM APPROVAL | Title 24-A - §2445. Effective dates Title 24-A - §2412. Filing, approval of forms |
No form shall be used unless approved by the Maine Bureau of Insurance. The following forms must be filed and approved:
- Policy Forms
- Endorsements
- Renewal Forms
Applications if required and made a part of the policy or contract.
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| POLICY MUST CONTAIN ENTIRE CONTRACT
| Title 24-A - §2402. "Policy" defined Title 24-A - §2412(1). Filing, approval of forms
Title 24-A - §2415. Charter, bylaw provisions
| "Policy" means the written contract of or written agreement for or effecting insurance, by whatever name called, and includes all clauses, riders, endorsements and papers which are a part thereof. Form includes: The basic form and any printed rider, endorsement or renewal form; An application form if a written application is required and is made a part of the policy or contract; and A certificate of coverage under a group policy or contract that is delivered or issued for delivery in this State. No policy shall contain any provision purporting to make any portion of the charter, bylaws or other constituent document of the insurer (other than the subscriber's agreement or power of attorney of a reciprocal insurer) a part of the contract unless such portion is set forth in full in the policy. Any policy provision in violation of this section shall be invalid. |
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| REBATE | Title 24-A - §2162(1). Unfair discrimination, rebates prohibited -- property, casualty, surety insurance | No property, casualty or surety insurer or any employee or representative thereof, and no broker, agent or solicitor as to such insurance shall pay, allow or give, or offer to pay, allow or give, directly or indirectly, as an inducement to insurance, or after insurance has been effected, any rebate, discount, abatement, credit or reduction of the premium named in a policy of insurance, or any special favor or advantage in the dividends or other benefits to accrue thereon, or any valuable consideration or inducement whatever, not specified or provided for in the policy, except to the extent provided for in an applicable filing with the superintendent as provided by law.
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| REVIEW OF FORM FILING
| Title 24-A - §2412(2). Filing, approval of forms | The Superintendent may extend the effective date of a form filing by 30 days by giving written notice to the insurer that additional time is needed to review the filing. |
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| SIGNATURES |
Title 24-A - §2416. Execution of policies | Every insurance policy shall be executed in the name of and on behalf of the insurer by its officer, attorney in fact, employee, or representative duly authorized by the insurer. A facsimile signature of any such executing individual may be used in lieu of an original signature. | |
| WORKERS' COMPENSATION EXCESS INSURANCE | Title 39-A - §403(10 &11)
Rule Chapter 250 -- Eligibility Requirements to Self-Insure Title 24-A - §4433(2)(G). Exclusion from Guaranty Fund | Qualifications for Re-insurance. Eligibility Requirements to Self-Insure
Contracts of workers' compensation excess insurance issued to
workers' compensation self-insurers approved under former Title
39, section 23 or under Title 39-A, section 403 by any insurer
after the effective date of this paragraph, or in the case of
a contract that automatically renews, not later than one year
after the effective date of this paragraph; | |
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RATE AND RULE FILING
REQUIREMENTS | |
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| ADOPTION OF LOSS COSTS WITH DIFFERENT EFFECTIVE DATE, DELAYING ADOPTION OF ADVISORY LOSS COST, MODIFYING ADVISORY LOSS COSTS, NOT ADOPTING ADVISORY LOSS COSTS
| Title 24-A - §2321-E. Filing of prospective loss costs and supplemental information
Insurance - Bulletin 241
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If an insurer that has filed to have its loss cost adjustments remain on file with the Bureau of Insurance intends to delay, modify, or not adopt particular advisory organization's Reference Filing, the insurer must make a filing with the Bureau of Insurance. The insurer's filed loss cost adjustments will remain in effect until the insurer withdraws them or files and receives approval of a revised Reference Filing Adoption Form. | |
| ADOPTIONS OF RATE SERVICE ORGANIZATIONS (RSO) FILINGS OR FILINGS OF ANOTHER INSURER | Title 24-A - §2304-B. Reference filings Title 24-A - §2382-C. Filing of rates and other rating information; filing of forms |
Advisory organizations may develop and file with the superintendent for approval prospective loss costs and supplementary rating information. Such filings shall contain the statistical data and supporting information for calculations or assumptions underlying the prospective loss costs. An insurer may satisfy its obligations to make rate filings by becoming a participating insurer of a licensed advisory organization that makes reference filings of advisory prospective loss costs and by authorizing the superintendent to accept reference filings on its behalf. The insurer's rates are the approved prospective loss costs combined with the modifications and expense and profit factors filed by the insurer. An insurer may adopt by reference, with or without deviation, the rates and supplementary rate information filed by another insurer. |
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| CATASTROPHE HAZARDS | Insurance - Bulletin 348
Title 24-A - §2382(5)(A)(2). Rate standards | Terrorism Risk Insurance Program Reauthorization Act of 2007 In determining whether rates comply with standards under this section, due consideration may be given to:
Catastrophe hazards and contingencies |
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| CLASSIFICATION SYSTEM |
Title 24-A - §2382-B. Uniform Administration of Classifications | Every workers' compensation insurer, including self-insurers, shall adhere to a uniform classification system. This system is filed with the Superintendent by an advisory organization designated by the superintendent and is subject to the Superintendent's disapproval. An insurer may develop sub-classifications and rates may be made for the sub-classifications. Any sub-classifications must be filed with the Superintendent 30 days prior to their use. Sub-classifications shall be disapproved if the insurer fails to demonstrate that data can be produced and reported consistently in accordance with the Uniform Statistical Plan and the classification system. The proposed classification shall also be disapproved if it:
- Is not reasonably related to the exposure to claim;
- Is not adequately defined;
- Has not been shown to distinguish among insureds based on the potential for or hazard of loss; or
- Is or will be unfairly discriminatory
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| COMPETITION |
Title 24-A - §2382. Rate standards | A rate is inadequate if it is insufficient to sustain projected losses and expenses and the use of the rate has a tendency to create a monopoly or cause serious financial harm to the insurer. Voluntary market rates are deemed not to be excessive. | |
| CONSENT-TO-RATE | Title 24-A - §2308. Excess rates |
A rate in excess of that provided by a filing may be used on any specific risk, providing that the following requirements are satisfied:
- The insurer files a written application with the superintendent signed by the insured or applicant stating the reasons for the request.
The superintendent assents to the use of an excess rate for the specific risk. |
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| DEDUCTIBLES |
Title 24-A - §2385(2). Optional deductibles Title 24-A - §2385-A. Medical expense deductibles Insurance - Bulletin 198 | Indemnity deductibles must be available for indemnity benefits in amounts of $1,000 and $5,000 per claim and in other reasonable amounts as may be approved by the superintendent.
Claims must first be paid by the insurer and then reimbursed by the employer up to the limit of the deductible. An insurer is not required to offer a deductible to an employer if, as a result of a credit investigation, the insurer determines that the employee is not sufficiently financially stable to be responsible for the payment of deductible amounts. Insurers shall offer deductibles for medical expenses as follows:
- $250 per occurrence to employers who are not experience rated.
- Either $250 or $500 per occurrence to employers who are experience rated.
- $500 to employers with estimated premium of over 500% of the premium to qualify for experience rating and with 10 or more employees (except for those employers in logging, lumbering and sawmills).
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| DISAPPROVAL OF RATES, GROUNDS FOR | Title 24-A - §2382-E(2). Disapproval of rates Title 24-A - §3714(2). Accounting; assessments |
Rates in the voluntary market shall be disapproved if they are inadequate or unfairly discriminatory. Rates in the residual market shall be disapproved if they are excessive, inadequate or unfairly discriminatory. Rates may be disapproved at any time if they are not in compliance with Title 24-A. Rates in the residual market are not excessive if the loss cost multiplier is 1.45 or lower. |
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| DISCRIMINATION | Title 24-A - §2382-E(2). Disapproval of rates
Title 24-A - §2382(4). Rate standards | Rates in the voluntary market will be disapproved if they are inadequate or unfairly discriminatory. Rates in the residual market will be disapproved if they are excessive, inadequate or unfairly discriminatory. Unfair discrimination exists if price differences do not reflect differences in expected losses and expenses. A rate is not unfairly discriminatory if policyholders have different premiums because of different expenses or different loss exposures, as long as the rate reflects the differences with reasonable accuracy. |
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| EXPENSES |
Title 24-A - §2382(5). Rate standards | In determining whether rates comply with standards under this section, due consideration may be given to: Past and prospective expenses, both countrywide and those specifically applicable to the State. | |
| EXPERIENCE RATING | Title 24-A - §2382-B. Uniform administration of classifications; reporting of rating and other information; membership in advisory organization
Title 24-A - §2382-D. Uniform experience rating plan; merit rating plan | The designated workers' compensation and advisory organization shall file with the superintendent uniform experience rating plans and rules to provide premium adjustments based on the past claim experience of an insured employer. The experience rating plan must provide that the claims experience for the 3 most recent years for which data is available be considered on the following bases:
- The claims and exposure for the most recent year for which data is available must be given 40% weight.
- The claims and exposure for the 2nd most recent year for which data is available must be given 35% weight.
- The claims and exposure for the 3rd most recent year for which data is available must be given 25% weight.
If data is available for only 2 years of experience, the weighting must be:
- 60% for the most recent year
40% for the 2nd most recent year.
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| FILE AND USE
| Title 24-A - §2382-C(1). Filing of rates and other rating information; filing of forms | Every insurer shall file with the superintendent all rates and supplementary rate information to be used in the State, except as filed by an advisory organization as provided in section 2384-A. Such rates and supplementary rate information must be filed at least 30 days prior to the stated effective date. An insurer may adopt by reference, with or without deviation, the rates and supplementary rate information filed by another insurer. Upon application by the filer, the superintendent may authorize an earlier effective date. |
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| FORM AND MANNER OF FILING |
Title 24-A - §2382-C. Filing of rates and other rating information; filing of forms | If a filing is not accompanied by information required by the Superintendent of Insurance, the Superintendent shall notify the insurer that the filing is not made until the information is provided. | |
| GROUNDS FOR DISAPPROVAL | Title 24-A - §2382-E(2). Disapproval of rates |
Basis for disapproval | |
| INADEQUATE RATES | Title 24-A - §2382(3). Rate standards | A rate is inadequate if it is insufficient to sustain projected losses and expenses and the use of the rate has a tendency to create a monopoly or cause serious financial harm to the insurer
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| LARGE DEDUCTIBLES
| Title 24-A - §2392(12). Definitions | A large deductible policy is a workers' compensation policy written with a per occurrence deductible in excess of $5,000 or a medical deductible in excess of $500. Claims must first be paid by the insurer and then reimbursed by the employer up to the limit of the deductible.
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| LOSS COST MULTIPLIERS | Title 24-A - §2304-B. Reference filings |
An insurer's expense and profit factors and loss cost modifications must remain in effect until the insurer withdraws or refiles new factors pursuant to section 2304-A. The superintendent may request that an insurer provide supporting information for the filed expense and profit factors and loss cost modifications at any time. |
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| MINIMUM PREMIUM RULES |
Title 24-A - §2304-A.Rate filings Insurance - Bulletin 241 | Every insurer shall file with the superintendent, every manual rate, minimum premium, class rate, rating schedule or rating plan and every other rating rule, and every modification of any of the foregoing which it proposes to use. Every such filing must state the effective date of the filing, and indicate the character and extent of the coverage contemplated. Every such filing must be made not less than 30 days in advance of the stated effective date unless that 30-day requirement is waived by the superintendent. An insurer must file the minimum premium rules, formulas, or amounts it proposes to use.
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| MERIT RATING | Title 24-A - §2382-D(3). Uniform experience rating plan; merit rating plan | If an insured is not eligible for the experience rating plan, a merit rating plan must be applied using the following guidelines. A plan must provide for the following credits or debits to be applied to the otherwise applicable manual premium, based on the number of lost-time claims of the insured during the most recent 3-year period for which statistics are available:
- No claims or a loss ratio of less than 1.0, an 8% credit;
- One claim resulting in a loss ratio greater than 1.0, no credit or debit; and
- Two or more claims resulting in a loss ratio greater than 1.0, an 8% debit.
The insurer shall notify the insured of the premium adjustment and the reason for the adjustment. |
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| OTHER FEES ASSOCIATED WITH THE ISSUANCE OF A POLICY, DELIVERY OF A POLICY OR COLLECTION OF PREMIUM | Title 24-A - §2174. Illegal dealing in premiums; excess charges for insurance
Title 24-A, §2304-A: Rate filings
Title 24-A, §2403: "Premium" defined | No person shall willfully collect as premium or charge for insurance any sum in excess of the premium or charge applicable to such insurance, and as specified in the policy, in accordance with the applicable classifications and rates as filed with and approved by the superintendent. | |
| PAYMENT PLANS | Title 39-A - §402. Prepayment of premium
Title 24-A, §2304-A: Rate filings
Title 24-A, §2403: "Premium" defined |
An insurance company that issues workers' compensation insurance policies may not require prepayment of premium more than 1/4 year in advance. | |
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PRE-PAYMENT OF PREMIUM | Title 39-A - §402. Prepayment of premium | An insurance company that issues workers' compensation insurance policies may not require prepayment of premium more than ½ year in advance.
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| PREMIUM AUDIT
| Rule Chapter 470 - Premium Audit | If the insurer has not established the final premium 120 days after the policy period ends, the insurer is prohibited from billing or collecting any additional premium exceeding the latest billed premium immediately prior to the 120-day time limit. However, if the insurer has failed to perform a final premium audit within the 120-day time limit, the insured, upon written request to the insurer, is entitled to a final premium audit for the purpose of determining if the insured has been overcharged. If the carrier is unable to examine and audit the records of the insured that relate to the calculation of the final premium and the inability is solely due to the failure of the insured to cooperate in the audit, then the 120-day limitation shall begin when the carrier is able to complete the examination and audit of the insured's records. The insurer must notify the insured in writing prior to 120 days from the end of the policy period of the reasons for the inability to establish the final premium.
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| PRIOR APPROVAL
| Title 24-A - §2384-A. Advisory organization filing requirements | Every advisory organization shall file with the superintendent every pure premium, manual of rating rules, rating schedule and change, amendment or modification of the foregoing proposed for use in the State at least 30 days prior to the proposed effective date. |
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| PROFIT LOADING |
Title 24-A - §2304-B. Reference filings Title 24-A - §2382. Rate standards | An insurer's expense and profit factors and loss cost modifications must remain in effect until the insurer withdraws or refiles new factors pursuant to section 2304-A. Upon approval of an advisory organization loss cost reference filing, the insurer's rates are the combination of the approved prospective loss costs and the insurer's expense and profit factors and its loss cost modification filed with the superintendent. Rates in the residual market are excessive if they are likely to produce a long-term profit that is unreasonably high for the insurance provided and for surplus requirements or if expenses are unreasonably high in relation to services rendered.
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| RATING TIERS
| Insurance - Bulletin 277 | Insurers must file with the Bureau every manual rate, minimum premium, class rate, rating schedule or rating plan and every other rating rule, and every proposed modification of any of these filings. Rating rules include any established criteria or guidelines that affect premiums charged to insureds. Workers' Compensation case filings are governed by Title 24-A M.R.S.A. § 2382-C, which requires insurers file "all rates and supplementary rate information." (Supplementary rate information includes rating rules, rating plans, and other similar information needed to determine the applicable premium for an insured).
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| RESIDUAL MARKET
| Title 24-A - §3714(2). | Rates filed within the rate-band are considered voluntary for purposes of chapter 25, subchapter II-B. If a rate is filed outside the rate band, the superintendent may disapprove the rate if it is excessive, inadequate or unfairly discriminatory, using the standards set forth in section 2382. "Rate band" means the range of rates from 85% to 145% of the benchmark rate. For the purposes of this subsection, "benchmark rate" is the pure premium rate filing filed by the State's advisory organization as defined in section 2381-C and currently approved by the superintendent.
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| RETROSPECTIVE RATING
| Title 24-A - §2382-D(5). Uniform experience rating plan; merit rating plan | An insurer or an advisory organization may file rating plans that provide for retrospective premium adjustments based on the insured's experience during the policy period. Retrospective rating plans must be voluntary and may not be used without the prior consent of the insured. |
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| RETURN ON EQUITY/INVESTMENT INCOME |
Title 24-A - §2382(5)(c). Rate standards | Rates may contain provision for contingencies and allowance permitting a reasonable profit. In determining the reasonableness of profit, consideration must be given to all investment income attributable to premiums, the reserves associated with those premiums and the amount of capital and surplus allocable to the coverage of risks in the State. | |
| TRENDING | Title 24-A - §2302-A(6). Definitions
Title 24-A - §2381-C(5). Definitions
| "Prospective loss costs" means that portion of a rate that does not include provisions for expenses, other than loss adjustment expenses, or profit, and is based on historical aggregate losses and loss adjustment expenses adjusted through development to their ultimate value and projected through trending to a future point in time. "Loss trending" means any procedure for projecting developed losses to the average date of loss for the period during which the policies are to be effective.
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| REVIEW OF RATE FILING
| Title 24-A - §2382-C. Filing of rates and other rating information; filing of forms Title 24-A - §2382-E. Disapproval of rates | The Superintendent may extend the effective date of a rate filing by 60 days by giving written notice to the insurer that additional time is needed to review the filing.
Reasons for disapproval
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| SERVICE CHARGES (COLLECTION EXPENSE SUCH AS, BUT NOT LIMITED TO, INSTALLMENT, NSF, REINSTATEMENT, LATE & CONVENIENCE FEES) | Title 24-A - §2174(2). Illegal dealing in premiums; excess charges for insurance
Title 24-A, §2304-A: Rate filings
Title 24-A, §2403: "Premium" defined | No person shall willfully collect as premium or charge for insurance any sum in excess of the premium or charge applicable to such insurance, and as specified in the policy, in accordance with the applicable classifications and rates as filed with and approved by the superintendent.
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| SUPPORTING DATA
| Title 24-A - §2304-B(2). Reference filings | At any time, the superintendent may request that an insurer provide supporting information for the filed expense and profit factors and loss cost modifications. |
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| SCHEDULE RATING |
Title 24-A - §2382. Rate standards | Schedule rating credits or debits of more than 25 percent are considered unfairly discriminatory. | |
| TIMELINESS | Title 24-A - §2382-C(1). Filing of rates and other rating information; filing of forms |
Rates and supplementary information shall be filed with the Superintendent of Insurance at least 30 days before the stated effective date. An insurer may adopt by reference, with or without deviation, the rates and supplementary rate information filed by another insurer. | |
