West Virginia Code
1 - DEFINITIONS
2 - INSURANCE COMMISSIONER
3 - LICENSING, FEES AND TAXATION OF
3A - STATE OF ENTRY FOR FOREIGN INS
4 - GENERAL PROVISIONS
4A - ALL-PAYER CLAIMS DATABASE
5 - ORGANIZATION AND PROCEDURES OF
6 - THE INSURANCE POLICY
6A - CANCELLATION OR NONRENEWAL OF
6B - DECLINATION OF AUTOMOBILE LIAB
6C - GUARANTEED LOSS RATIOS AS APPL
6D - MOTOR VEHICLE REPAIR AND REPLA
6F - DISCLOSURE OF NONPUBLIC PERSON
7 - ASSETS AND LIABILITIES
8 - INVESTMENTS
8A - USE OF CLEARING CORPORATIONS A
9 - ADMINISTRATION OF DEPOSITS
10 - REHABILITATION AND LIQUIDATIO
11 - UNFAIR TRADE PRACTICES
11A - INSURANCE SALES CONSUMER PRO
12 - INSURANCE PRODUCERS AND SOLIC
12A - CONTRACTUAL RELATIONSHIPS BE
12B - ADJUSTERS
12C - SURPLUS LINE
13 - LIFE INSURANCE
13A - VARIABLE CONTRACTS
13B - CHARITABLE GIFT ANNUITIES
13C - VIATICAL SETTLEMENTS ACT
14 - GROUP LIFE INSURANCE
15 - ACCIDENT AND SICKNESS INSURAN
15A - WEST VIRGINIA LONG-TERM CARE
15B - UNIFORM HEALTH CARE ADMINIST
15C - DIABETES INSURANCE
15D - INDIVIDUAL LIMITED HEALTH BE
15E - DISCOUNT MEDICAL PLAN ORGANI
16 - GROUP ACCIDENT AND SICKNESS I
16A - GROUP HEALTH INSURANCE CONVE
16B - ACCIDENT AND SICKNESS RATES
16C - EMPLOYER GROUP ACCIDENT AND
16D - MARKETING AND RATE PRACTICES
16E - CONTRACEPTIVE COVERAGE
16F - GROUP LIMITED HEALTH BENEFIT
16G - WEST VIRGINIA HEALTH BENEFIT
16H - REVIEW OF ADVERSE DETERMINAT
17 - FIRE AND MARINE INSURANCE
17A - PROPERTY INSURANCE DECLINATI
18 - CASUALTY INSURANCE
19 - SURETY INSURANCE
20 - RATES AND RATING ORGANIZATION
20A - WEST VIRGINIA ESSENTIAL INSU
20B - RATES AND MALPRACTICE INSURA
33 - 20 B- 1
33 - 20 B- 2
33 - 20 B- 3
33 - 20 B- 3 A
33 - 20 B- 4
33 - 20 B- 5
33 - 20 B- 6
33 - 20 B- 7
33 - 20 B- 8
33 - 20 B- 9
20C - CANCELLATION OR NONRENEWAL O
20D - TAIL INSURANCE
20E - WEST VIRGINIA MEDICAL PROFES
20F - PHYSICIANS' MUTUAL INSURANCE
21 - RECIPROCAL INSURERS
22 - FARMERS' MUTUAL FIRE INSURANC
23 - FRATERNAL BENEFIT SOCIETIES
24 - HOSPITAL SERVICE CORPORATIONS
25 - HEALTH CARE CORPORATIONS
25A - HEALTH MAINTENANCE ORGANIZAT
25B - FEDERAL INSURANCE SUBSIDY FO
25C - HEALTH MAINTENANCE ORGANIZAT
25D - PREPAID LIMITED HEALTH SERVI
25E - PATIENTS' EYE CARE ACT
25F - COVERAGE FOR PATIENT COST OF
25G - PROVIDER SPONSORED NETWORKS
26 - WEST VIRGINIA GUARANTY ASSOCI
26A - WEST VIRGINIA LIFE AND HEALT
26B - WEST VIRGINIA HEALTH MAINTEN
27 - INSURANCE HOLDING COMPANY SYS
28 - INDIVIDUAL ACCIDENT AND SICKN
29 - LIFE AND ACCIDENT AND SICKNES
30 - MINE SUBSIDENCE INSURANCE
31 - CAPTIVE INSURANCE
31A - SPONSORED CAPTIVE INSURANCE
32 - RISK RETENTION ACT
33 - ANNUAL AUDITED FINANCIAL REPO
34 - ADMINISTRATIVE SUPERVISION
34A - STANDARDS AND COMMISSIONER'S
35 - CRIMINAL SANCTIONS FOR FAILUR
36 - BUSINESS TRANSACTED WITH PROD
37 - MANAGING GENERAL AGENTS
38 - REINSURANCE INTERMEDIARY ACT
39 - DISCLOSURE OF MATERIAL TRANSA
40 - RISK-BASED CAPITAL (RBC) FOR
40A - RISKED-BASED CAPITAL FOR HEA
40B - RISK MANAGEMENT AND OWN RISK
41 - PRIVILEGES AND IMMUNITY
42 - WOMEN'S ACCESS TO HEALTH CARE
43 - INSURANCE TAX PROCEDURES ACT
44 - UNAUTHORIZED INSURERS ACT
45 - ETHICS AND FAIRNESS IN INSURE
46 - THIRD-PARTY ADMINISTRATOR ACT
46A - PROFESSIONAL EMPLOYER ORGANI
47 - INTERSTATE INSURANCE PRODUCT
48 - MODEL HEALTH PLAN FOR UNINSUR
49 - FLOOD INSURANCE
50 - PATIENT PROTECTION AND TRANSP
51 - PHARMACY AUDIT INTEGRITY ACT
ARTICLE 20B. RATES AND MALPRACTICE INSURANCE POLICIES.
This article applies to medical malpractice insurance policies only. Nothing in this article shall be construed to supplant any provision of article twenty of this chapter which does not directly conflict with the provisions herein.
Any and all modifications of rates shall be made in accordance with the following provisions:
(a) Due consideration shall be given to the past and prospective loss experience within and outside this state.
(b) Due consideration shall be given to catastrophe hazards, if any, to a reasonable margin for underwriting profit and contingencies, to dividends, savings or unabsorbed premium deposits allowed or returned by insurers to their policyholders, members or subscribers and actual past expenses and demonstrable prospective or projected expenses applicable to this state.
(c) Rates shall not be excessive, inadequate, predatory or unfairly discriminatory.
(d) Risks may not be grouped by territorial areas for the establishment of rates and minimum premiums.
(e) An insurer may use guide "A" rates and other nonapproved rates, also known as "consent to rates": Provided, That the insurer shall, prior to entering into an agreement with an individual provider or any health care entity, submit guide "A" rates and other nonapproved rates to the commissioner for review and approval: Provided, however, That the commissioner shall propose legislative rules for promulgation in accordance with the provisions of article three, chapter twenty-nine-a of this code, which set forth the standards and procedure for reviewing and approving guide "A" rates and other nonapproved rates. No insurer may require execution of a consent to rate endorsement for the purpose of offering to issue or issuing a contract or coverage to an insured or continuing an existing contract or coverage at a rate in excess of that provided by a filing otherwise applicable.
(f) Except to the extent necessary to meet the provisions of subdivision (c) of this section, uniformity among insurers, in any matters within the scope of this section, is neither required nor prohibited.
(g) Rates made in accordance with this section may be used subject to the provisions of this article.
(a) On or before July 1, 2004 and on July 1, each year thereafter, or at such other time specified by the commissioner, every insurer offering malpractice insurance in this state shall make a rate filing, in accordance with the provisions of section four, article twenty of this chapter, regardless of whether any increase or decrease is indicated, pursuant to subsection (a), section four, article twenty of this chapter. The information furnished in support of a filing shall include: (i) The experience or judgment of the insurer or rating organization making the filing; (ii) its interpretation of any statistical data the filing relies upon; (iii) the experience of other insurers or rating organizations; (iv) the character and extent of the coverage contemplated; (v) the proposed effective date of any requested change and (vi) any other relevant factors required by the commissioner. When a filing is not accompanied by the information required by this section upon which the insurer supports the filing, the commissioner shall require the insurer to furnish the information and, in that event, the waiting period prescribed by subsection (b) of this section shall commence as of the date the information is furnished.
A filing and any supporting information shall be open to public inspection as soon as the filing is received by the commissioner. Any interested party may file a brief with the commissioner supporting his or her position concerning the filing. Any person or organization may file with the commissioner a signed statement declaring and supporting his or her or its position concerning the filing. Upon receipt of any such statement prior to the effective date of the filing, the commissioner shall mail or deliver a copy of the statement to the filer, which may file a reply. This section is not applicable to any memorandum or statement of any kind by any employee of the commissioner.
(b) Every filing shall be on file for a waiting period of ninety days before it becomes effective. The commissioner may extend the waiting period for an additional period not to exceed thirty days if he or she gives written notice within the waiting period to the insurer or rating organization which made the filing that he or she needs the additional time for the consideration of the filing. Upon written application by the insurer or rating organization, the commissioner may authorize a filing which he or she has reviewed to become effective before the expiration of the waiting period or any extension of the waiting period. A filing shall be deemed to meet the requirements of this article unless disapproved by the commissioner within the waiting period or any extension thereof.
(c) No insurer shall make or issue a contract or policy of malpractice insurance except in accordance with the filings which are in effect for the insurer as provided in this article.
Reduced rates charged for certain specialties or risks found by the commissioner to be predatory, designed to gain market share or otherwise inadequate are prohibited.
(a) If within the waiting period or any extension thereof as provided in subsection (b), section three of this article, the commissioner finds that a filing does not meet the requirements of this article, he or she shall send to the insurer or rating organization which made the filing written notice of disapproval of the filing specifying therein in what respects he or she finds the filing fails to meet the requirements of this article and stating that the filing shall not be effective. Within thirty days from the issuance of written notice of disapproval, any insurer or rating organization aggrieved by the disapproval of any filing may request a hearing pursuant to section thirteen, article two of this chapter.
(b) If at any time subsequent to the waiting period or any extension thereof as provided in subsection (b), section three of this article, the commissioner finds that a filing does not meet the requirements of this article, he or she shall send to the insurer or rating organization which made the filing a written order specifying in what respect he or she finds that such filing fails to meet the requirements of this article and a date, not less than thirty days from the issuance of the order, when the filing shall be considered no longer effective. Within thirty days from the issuance of the order, any insurer or rating organization aggrieved by the order may request a hearing thereon pursuant to section thirteen, article two of this chapter. Any such order shall not affect any contract or policy made or issued prior to the expiration date set forth in the order.
(c) Any person or organization aggrieved by any filing which is in effect or the application thereof may request a hearing thereon pursuant to section thirteen, article two of this chapter. The insurer or rating organization which made the filing shall be notified in writing upon receipt of any request for hearing and thereby made a party to the hearing. Upon hearing, if the commissioner finds that the filing fails to meet the requirements of this article, he or she shall issue an order specifying in what respects he or she so finds and a date, not less than thirty days from the issuance of the order, when the filings shall be considered no longer effective.
(d) Within the initial ninety-day waiting period, the commissioner shall hold a public hearing upon every filing which requests an increase in general rates of ten percent or more and upon every filing which, in the opinion of the commissioner, is of such import that it will affect the public. The insurer or rating organization which made the filing shall be notified in writing not less than fifteen days prior to the hearing date. Notice of the time, place and filing to be considered shall be published as a Class II legal advertisement in every county in the state in accordance with article three, chapter fifty-nine of this code.
(a) A corporation, an unincorporated association, a partnership or an individual, whether located within or outside this state, may make application to the commissioner for license as a rating organization for such kinds of malpractice insurance as are specified in its application and shall file therewith: (1) a copy of its Constitution, its articles of agreement or association or its certificates of incorporation, and of its bylaws, rules and regulations governing the conduct of its business; (2) a list of its members and subscribers; (3) the name and address of a resident of this state as attorney-in-fact upon whom notices or orders of the commissioner or process affecting such rating organization may be served; and (4) a statement of its qualifications as a rating organization. If the commissioner finds that the applicant is competent, trustworthy and otherwise qualified to act as a rating organization and that its Constitution, articles of agreement or association or certificate of incorporation, and its bylaws, rules and regulations governing the conduct of its business conform to the requirements of law, he shall issue a license specifying the kinds of insurance or subdivisions thereof for which the applicant is authorized to act as a rating organization. Every such application shall be granted or denied in whole or in part by the commissioner within sixty days of the date of its filing with him. Licenses issued pursuant to this section shall remain in effect for three years unless sooner suspended or revoked by the commissioner. The fee for said license shall be $25, which fee shall be in addition to all other fees, licenses or taxes to which a rating organization might otherwise be subject, and all fees so collected shall be paid to the state Treasury pursuant to subsection (b), section thirteen, article three of this chapter. In the event the rating organization ceases to meet the requirements of this article, the license issued pursuant to this section may be suspended or revoked by the commissioner upon notice and hearing pursuant to article five, chapter twenty-nine-a of this code. Every rating organization shall notify the commissioner promptly of every change in: (1) its Constitution, its articles of agreement or association or its certificate of incorporation, and its bylaws, rules and regulations governing the conduct of its business; (2) its list of members and subscribers; and (3) the name and address of the resident of this state designated as attorney-in-fact by it upon whom notices or orders of the commissioner or process affecting such rating organization may be served.
(b) The commissioner shall promulgate legislative rules pursuant to article three, chapter twenty-nine-a of this code prescribing procedures for rating organizations to permit any insurer not a member to become a subscriber to its rating services for any kind of insurance for which it is authorized to act as a rating organization pursuant to this section. Each rating organization shall furnish its rating services without discrimination to its members and subscribers. The reasonableness of any legislative rule in its application to subscribers shall be reviewed by the commissioner upon request of any such subscriber. If the commissioner finds, upon notice and hearing provided pursuant to article five, chapter twenty-nine-a of this code, that such rule or regulation is unreasonable in its application to subscribers, he shall order that such rule is not to be applicable to subscribers and promulgate a revised rule. The denial of any insurer's application for subscribership in contravention of a legislative rule or the failure to approve or deny such an application within thirty days after submission to the rating organization shall be reviewed by the commissioner upon request of the aggrieved insurer. If the commissioner finds, upon notice and hearing provided pursuant to article five, chapter twenty-nine-a of this code, that the insurer has been wrongfully denied subscribership, he shall order the rating organization to admit the insurer as a subscriber.
(c) No rating organization shall adopt any policy or rule the effect of which would be to prohibit or regulate the payment of dividends, savings or unabsorbed premium deposits allowed or returned by insurers to their policy holders, members or subscribers.
(d) Cooperation among rating organizations or among rating organizations and insurers in rate making or in other matters within the scope of this article or article twenty of this chapter is hereby authorized, provided the filings resulting from such cooperation are subject to all the provisions of this article and article twenty which are applicable to filings generally.
The commissioner may review such cooperative activities and practices. If the commissioner finds, upon notice and hearing provided pursuant to article five, chapter twenty-nine-a of this code, that any such activity or practice is unfair, unreasonable or otherwise inconsistent with the provisions of this article, he shall issue a written order specifying in what respects such activity or practice is unfair, unreasonable or otherwise inconsistent with the provisions of this article, and requiring that such activity or practice be discontinued immediately.
(e) Any rating organization may subscribe for or purchase actuarial, technical or other services, and such services shall be available to all members and subscribers without discrimination.
(a) The commissioner shall review annually the rules, rates and rating plans filed and in effect for each insurer providing five percent or more of the malpractice insurance coverage in this state in the preceding calendar year to determine whether the filings continue to meet the requirements of this article and whether the filings are unfair or inappropriate given the loss experience in this state in the preceding year.
The commissioner shall promulgate legislative rules pursuant to article three, chapter twenty-nine-a of this code establishing procedures for the fair and appropriate evaluation and determination of the past loss experience and prospective or projected loss experience of insurers within and outside this state, actual past expenses incurred in this state and demonstrable prospective or projected expenses applicable to this state.
(b) The commissioner shall promulgate legislative rules pursuant to article three, chapter twenty-nine-a of this code establishing procedures whereby each insurer providing five percent or more of the malpractice insurance coverage in this state annually shall submit to the commissioner the following information:
(1) The number of claims filed per category;
(2) The number of civil actions filed;
(3) The number of civil actions compromised or settled;
(4) The number of verdicts in civil actions;
(5) The number of civil actions appealed;
(6) The number of civil actions dismissed;
(7) The total dollar amount paid in claims compromised or settled;
(8) The total dollar amount paid pursuant to verdicts in civil actions;
(9) The number of claims closed without payment and the amount held in reserve for all such claims;
(10) The total dollar amount expended for loss adjustment expenses, commissions and brokerage expenses;
(11) The total dollar amount expended in defense and litigation of claims;
(12) The total dollar amount held in reserve for anticipated claims;
(13) Net profit or loss;
(14) Investment and other income on net realized capital gains and loss reserves and unearned premiums; and
(15) The number of malpractice insurance policies canceled for reasons other than nonpayment of premiums.
The commissioner shall establish, in the rules, methods of allocating investment and other income among capital gains, loss reserves, unearned premiums and other assets if an insurer does not separately account for and allocate that income.
Any insurer who fails to submit any information to the commissioner, as required by this subsection, in accordance with the rules promulgated under this subsection, shall be fined $10,000 for each of the first five failures and shall be fined $100,000 for the sixth and each subsequent failure.
(c) The commissioner shall report annually, during the month of November, to the joint standing committee on the judiciary the following information pertaining to each insurer providing five percent or more of the malpractice insurance coverage in this state:
(1) The loss experience within the state during the preceding calendar year;
(2) The rules, rates and rating plans in effect on the date of the report;
(3) The investment portfolio, including reserves, and the annual rate of return on the investment portfolio; and
(4) The information submitted to the commissioner pursuant to the rules promulgated by authority of subsection (b) of this section.
The commissioner is hereby directed to study the feasibility and desirability of creating joint underwriting associations or alternative pooling agreements to facilitate the issuance and underwriting of malpractice insurance policies in this state. The commissioner is further directed to identify and study the policies and practices of all insurers in settling dollar amounts to be held in reserve for anticipated claims and claims filed against malpractice insurance policies in this state.
Beginning in the year one thousand nine hundred eighty-six, the commissioner shall report periodically the results of the studies required by this section to the joint standing committee of the judiciary. Beginning in the year one thousand nine hundred eighty-seven, the commissioner shall file an annual report of the results of such studies with the Legislature on the first day of its regular session.
§33-20B-8. Insurers required to report results of civil actions against physicians or podiatrists; penalties for failure to report; notice and hearing.
(a) Every insurer issuing, or issuing for delivery in this state, a professional liability policy or providing professional liability insurance to health care providers, including, but not limited to, physicians, osteopathic physicians or surgeons, podiatrists or chiropractors, hospitals, medical clinics, professional limited liability companies, medical corporations or partnerships in this state shall submit to the commissioner, within sixty days from the date of entry of any judgment or dismissal without payment, the date a release is executed in connection with a settlement or the date a file is closed on any claim in which a law suit has not been filed involving the insured, the following information:
(1) The date of any judgment, dismissal or settlement;
(2) Whether any appeal has been taken on the judgment and, if so, by which party;
(3) The amount of any settlement or judgment against the insured;
(4) Whether the claim was the subject of mediation;
(5) Whether any settlement of a claim was made in a lump sum payment, a structured settlement or a combination of the two; and
(6) Any other information required by the commissioner.
For purposes of this section, "claim" means a third-party request for indemnification.
(b) If there is any additional resolution, including appellate decision or other subsequent action, the insurer shall file a supplemental report to the commissioner.
(c) The West Virginia insurance guaranty association created pursuant to article twenty-six of this chapter and the state Board of Risk and Insurance Management created pursuant to article twelve, chapter twenty-nine of this code are subject to the reporting requirements of subsection (a) of this section.
(d) Any insurer or entity that fails to report any information required to be reported under this section is subject to a civil money penalty to be imposed by the Insurance Commissioner. Upon a determination of the commissioner that there is probable cause to believe that any insurer or entity has failed or refused to make a report required by this section, the commissioner shall provide written notice to the alleged violator stating the nature of the alleged violation. Upon written request of the alleged violator within thirty days of the date of the commissioner's written notice, the commissioner shall notify the alleged violator of the time and place of a hearing at which the alleged violator may appear to show good cause why a civil penalty should not be imposed. The hearing shall be conducted in accordance with the provisions of article five, chapter twenty-nine-a of this code.
(e) If the commissioner determines that a violation of this section has occurred, the commissioner shall assess a civil penalty of not less than $1,000 nor more than $10,000 per violation. Anyone so assessed shall be notified of the assessment in writing and the notice shall specify the reasons for the assessment. If the alleged violator requests a hearing, as provided in subsection (d) of this section, the commissioner may not make his or her determination of violation and assessment until the conclusion of the hearing. The amount of penalty collected shall be deposited in the General Revenue Fund.
(f) If any violator fails to pay the amount of the penalty assessment to the commissioner within thirty days after issuance of notice of the penalty assessment, the commissioner may institute a civil action in the circuit court of Kanawha County to recover the amount of the assessment. In any civil action, the court's review of the commissioner's action shall be conducted in accordance with the provisions of section four, article five, chapter twenty-nine-a of this code.
(g) No person or entity may be held liable in any civil action with respect to any report made pursuant to this section if the report was made without knowledge of any falsity of the information contained in the report.
§33-20B-9. Authority of commissioner to promulgate rules and regulations regarding affiliate and subsidiary operating results.
The commissioner may as he deems necessary after notice and hearing promulgate rules and regulations in accordance with chapter twenty-nine-a of this code to define the commissioner's authority to consider the operating results of an insurer's affiliates and subsidiaries in the rate making and solvency determination of that insurer.