H. B. 4736
(By Delegate H. White)
[Introduced February 23, 2006; referred to the
Committee on Banking and Insurance then the Judiciary.]
A BILL to amend and reenact §33-6C-2 of the Code of West Virginia,
1931, as amended; and to amend and reenact §33-16B-1 of said
code, all relating generally to sickness and accident
insurance and with respect thereto premiums, benefits and
guaranteed loss ratios.
Be it enacted by the Legislature of West Virginia:
That §33-6C-2 of the Code of West Virginia, 1931, as amended,
be amended and reenacted; and that §33-16B-1 of said code be
amended and reenacted, all to read as follows:
ARTICLE 6C. GUARANTEED LOSS RATIOS AS APPLIED TO INDIVIDUAL
SICKNESS AND ACCIDENT INSURANCE POLICIES.
§33-6C-2. Insurance Commissioner to establish guaranteed loss
ratios; minimum rates; participation by insurer;
calculation of ratios; minimum rate; application.
(a) The Insurance Commissioner shall establish a guaranteed loss ratio which may be implemented by any insurer offering
individual sickness and accident insurance policies other than
limited benefits accident and sickness insurance policies or
certificates, which are subject to loss ratio requirements set
forth in sections three and four, article sixteen-e of this
chapter. The loss ratios shall be calculated by the commissioner
and each individual insurer and shall be based upon studies and
relevant information collected from various sources, including, but
not limited to, the health care cost review authority and the
national association of insurance commissioners' rate filing
guidelines: Provided, That the guaranteed loss ratio shall not be
less than sixty percent during the life of the policy. The
guaranteed loss ratio for each insurer shall be published by the
Insurance Commissioner in the register maintained by the Secretary
of State.
(b) The guaranteed loss ratio shall be based upon experience
periods during which the insurer earns one million dollars in
premium in West Virginia: Provided, That if the annual earned
premium volume in West Virginia is less than one million dollars,
the loss ratio guarantee shall be based on such other actuarially
sound methods as the commissioner may determine are appropriate,
including, but not limited to, the actual nationwide loss ratios:
Provided, however, That if the aggregate earned premium for all
states is less than one million dollars, the experience period will be extended until the end of the calendar year in which one million
dollars of earned premium is attained.
(c) Any insurer may apply to the commissioner to operate on a
guaranteed loss ratio basis. The insurance commissioner may review
each application and, in his or her discretion, approve or reject
the same. Any insurer approved by the commissioner shall be exempt
from filing rate increase applications as required by the
commissioner and other provisions of this chapter. Rates on a
particular policy form shall be deemed approved by the Insurance
Commissioner upon filing with the commissioner if the insurer has
filed a loss ratio guarantee with the commissioner and complied
with the terms of the loss ratio guarantee. Benefits will continue
to be deemed reasonable by the Insurance Commissioner in relation
to the premium so long as the insurer complies with the terms of
the loss ratio guarantee.
ARTICLE 16B. ACCIDENT AND SICKNESS RATES.
§33-16B-1. Filing and approval of accident and sickness rates.
(a) Premium rate charges for any individual or group accident
and sickness insurance policy, certificate or other evidence of
insurance issued, endorsed or delivered in this state shall be
filed with the commissioner for a waiting period of sixty days
before the charges become effective. At the expiration of sixty
days the premium rate charges filed are deemed approved unless
prior thereto the charges have been affirmatively approved or disapproved by the commissioner.
(b) The commissioner shall disapprove accident and health
insurance premium rates which are not in compliance with the
requirements of this chapter or any rule promulgated by the
commissioner pursuant to section two of this article. The
commissioner shall send written notice of the disapproval to the
insurer. The commissioner may approve the premium rates before the
sixty-day period expires by giving written notice of approval.
(c) In lieu of filing premium rates pursuant to subsection
(a) of this section, any individual or group accident and sickness
policy may file a guaranteed loss ratio in accordance with article
six-c of this chapter. For the purposes of this subsection, all
references to individual sickness and accident insurance policies
in article six-c shall be deemed to include group accident and
sickness policies, certificates or other evidence of coverage.
NOTE: The purpose of this bill is to allow premiums for
sickness and accident insurance to be based upon guaranteed loss
ratios filed with the Insurance Commissioner.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.
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