4359294 - Florida Administrative Rules, Law, Code, Register

Florida Department of State and Division of Library and Information Services


Notice: 4359294
Notice of Meeting/Workshop Hearing

Department:	DEPARTMENT OF FINANCIAL SERVICES
Division:	OIR – Insurance Regulation


Overview



	The Financial Services Commission announces a public meeting to which all persons are invited.

DATE AND TIME:	July 31, 2007, during a regular meeting of the Financial Services Commission.

PLACE:	Cabinet Meeting Room, Lower Level, The Capitol, Tallahassee, Florida

Subject:	This is the Final Public Hearing on the adoption of proposed amendments to Rule 69O-170; Part I, Florida Administrative Code, published on July 1, 2007 in Vol. 31, No. 26, of the Florida Administrative Weekly. A notice of change was published on May 25, 2007 in Vol. 33, No. 21. Pursuant to the provisions of the Americans with Disabilities Act, any person requiring special accommodations to participate in this program, please advise the contact person at least 5 calendar days before the program by contacting Michael Milnes at E-mail Michael.milnes@fldfs.com. If you are hearing or speech impaired, please contact the agency using the Florida Relay Service, 1(800)955-8771 (TDD) or 1(800)955-8770 (Voice). THE FULL TEXT OF THE PROPOSED RULES IS: 69O-170.005 Use of Filed Rates. (1) This rule applies to all property and casualty insurance to which Section 627.062 or 627.0651, F.S., applies. (a) Section 627.062, F.S., applies to property, casualty and surety insurance on subjects of insurance resident, located, or to be performed in Florida. (b) Section 627.062 does not apply to the following: 1. Reinsurance, except joint reinsurance as provided in Section 627.311, F.S. 2. Insurance against loss of or damage to aircraft, their hulls, accessories, or equipment. 3. Liability arising out of the ownership, maintenance, or use of aircraft, other than workers' compensation and employer's liability. 4. Insurance of vessels or craft, their cargoes, marine builders' risks, marine protection and indemnity, or other risks commonly insured under ocean marine coverages. 5. Surplus lines insurance placed under the provisions of Sections 626.913-626.937, F.S. 6. Health insurance. (2) Any Each insurer making a rate filing made with the Office shall pursuant to Section 627.062, F.S., for all applicable classes, may elect whether to file rates are filed as “file and use” or “use and file.” as defined in Section 627.062(2) or 627.0651(1), F.S. (a) “File and use” is defined as a rate filing made at least 60 days before the proposed effective date and which filing is not implemented during the Office's review of the filing and any proceeding or judicial review. (b) “Use and file” is defined as rate filing made less than 60 days before the proposed effective date or no later than 30 days after the effective date. (3) The filing of rates as required in Section 627.062(2)(a)1. and 2., F.S., requires that specific rates be filed and precludes the filing of ranges of rates. (4) All rate filings shall be submitted pursuant to Rule 69O-170.013, F.A.C. Each insurer making rate filings pursuant to Section 627.062 F.S., shall state in a cover letter or filing memorandum whether the filing is submitted as “file and use” or “use and file.” (5) If “file and Use’ is selected, the insurer shall include, as part of the filing, the proposed effective date for new and renewal business. (5)(6) For If “use and file” filings, any filing which is not made within the timelines provided by statute, e.g., the filing is received by the Office more than 30 days after the effective date, shall result in the Office’s issuance of a Notice of Intent to disapprove is selected, the insurer shall include, as part of the filing, final printed manual pages and effective dates for new and renewal business. (6)(a) Changing the filing designation during the review of the filing from “file and use” to “use and file” or from “use and file” to “file and use”, shall constitute a withdrawal of the filing and require a timely resubmission under the revised filing type as a new filing. (b) Notwithstanding the above and following the approval of the filing by the Office, pursuant to Section 627.062 or 627.0651, F.S., the filer may amend the effective date for a “file and use” filing to be shorter than the 90 or 60 days indicated in Section 627.062 or 627.0651, F.S., as long as the amended effective date is subsequent to the approval of the Office and provides the required statutory policyholder notice. Specific Authority 624.308(1) FS. Law Implemented 624.307(1), 627.062, 627.0651 FS. History–New 10-21-87, Formerly 4-72.005, Amended 1-27-92, Formerly 4-170.005, Amended________. 69O-170.006 Rate Manual Filings and Revisions. (1) All companies authorized to write property, casualty, surety and private passenger automobile lines of insurance excluding worker’s compensation, who have filings in force in the State of Florida, shall provide the Department of Insurance with a complete manual, for each applicable line which such insurer is authorized to write, concurrent with the insurer’s next base rate filing made on or after March 1, 1989, or if no rate filing is made, no later than January 1, 1990. Each manual filed with the Department shall include all currently applicable rates, rules, definitions and symbol pages. In addition, private passenger automobile and homeowners manuals shall include all currently applicable underwriting rules. Each manual page shall reflect the Department stamp, or the insurer shall submit a letter signed by an officer certifying that the manual pages being submitting represent all pages which are current and on file with the Department. Each manual shall be supplied in paper form in a binder. (1)(2) Thereafter, Eeach insurer shall submit revised manual pages and a checklist page or manual revision notice specifying the rule of application, effective date and the page number of: (a) through (d) No change. (2)(3) In order to enable the Office to maintain complete and up-to-date rate manuals, Tthe following shall be included on each manual page: (a) Insurer Company Name(s); (b) Line of Business and Program Name (if applicable); (c) Page Number (each page should have a unique number); and (d) Revision Date or other Date connected with the filing, e.g., filing date, effective date, editing date, etc. (specify the type of date used). (3)(4)(a) Insurers Companies shall include a separate cover letter and manual for each line of business, as designated in paragraph (c)(d) below, and by program within each line. For every filing submit three copies of each manual page for each company. If the initial submission, as required by subsection (1), is not a filing but a complete unchanged manual, submit one copy of each manual for each company. These manuals shall be supplied in paper form. (b) All filings and manual pages shall be filed on 8-1/2'' by 11'' paper or smaller. (b)(c) Except for private passenger automobile insurance, homeowners and dwelling fire and liability, insurers authorized by a rating organization to utilize the rating organization’s loss costs and rules, after those loss costs and rules have been approved for use by the Office, need only file the loss cost multiplier to be used with those loss costs companies that utilize rates and rules from a rating organization such as Insurance Services Office and Surety Association of America, etc., need only to file the rates, rules, deviations or effective dates, which are the exceptions to those filed on behalf of the company by the rating organization. (c)(d) For purposes of identifying filings submitted to the Office, a line of business shall be identified by one of the following. Additional identification may be used as needed. Filings for types of insurance not on this list should contain appropriate identification. 1. through 9. No change. 10. Other General Liability (including Excess and Umbrella Coverage). 11. No change. 12. Mobile Homeowners. 13. through 17. No change. 18. Dwelling Fire and Liability. (d)(e) Insurers Companies that submit filings on a group basis may submit manual pages on a group basis, provided each manual page identifies the insurers companies to which it is applicable. (5) If available on microfilm, manuals shall also be supplied in this form with a computer tape index. This is in addition to the paper manuals required above. The specifications for microfilm and computer tape are as follows: Microfilm Specifications (a)1. Reduction Ratio: 24:1 through 40:1 2. Indexing: 1 level Each document receives an image mark, all image marks are same size either small or medium, for example: 2 level Each key document (i.e., first page of each rate section) receives a medium-sized image mark. Each attachment receives a small image mark. 3. Film: 16 mm silver based (Ester base) microfilm – 100 ft. 2.5 mil Kodak 100 ft., 1460 Ester base, or – 215 ft. 5.0 mil Kodak 215 ft., 3460 Ester base Note: Thin base (215 ft.) film is preferred. 4. Film must be processed and stored in industry standard (ANSI cartridge) return reel. Kodak solid flange return reel, cat. # 144 2193 No Leader No Trailer No Cartridge Film Each Roll Must Have a Trail Holder Data Tape Specifications (b)1. Input Tape a. 1600 Bpi b. 9 Track, 600-2400 foot lengths c. ASCII or EBCDIC d. Fixed length fields (identify field size & starting point) e. Fixed length records (identify record size) f. Fixed length blocks (identify block size & number of blocks) (maximum block size 4,000 bytes) g. Labels allowed if verification positions are identified h. Must identify if label exists i. No stacked files j. Additional data fields may reside on tape but each field must have a beginning and ending point. 2. Fields Required a. State insurance identification # Company code b. Form numbers c. Line of business code (supply code) d. File date e. New date – renew date f. Form _ Rate _ Both _ (4)(6)(a) All private passenger automobile and homeowners insurance underwriting guidelines, for both new and renewal business, are subject to filing requirements. (b) For filings involving base rate adjustments other than private passenger automobile and homeowners, insurers shall describe in sufficient detail in writing all changes to the underwriting guidelines since the inception of the submitted experience period in order that the Office may ascertain the actuarial impact upon proposed rates pursuant to s.Section 627.062, F.S. (c) For the purpose of paragraph (4)(6)(b);, 1. Uunderwriting guidelines shall mean qualitative standards affecting the eligibility of risks for insurance, but do not include procedures for determining eligibility (such as delegations of binding authority). 2. Qualitative standards shall mean standards affecting the quality of risk such as loss history, credit scoring, acceptable number of claims or claim frequencies, required loss control, or violation points or prior accidents in the case of motor vehicles; and does not include quantitative standards that relate to the size of risks (such as square footage, number of vehicles, or gross receipts) or standards that relate to the amount of coverage that will be provided. paragraphs (6)(b) and (6)(c) do not require the descriptions of such underwriting guidelines which were effectuated prior to the end of the experience period preceding the effective date of this rule. Furthermore, paragraphs (6)(b) and (6)(c) shall not be construed to require the filing of underwriting guidelines. The provisions of this paragraph shall not affect the ability of the Office to request guidelines or filings of such guidelines where otherwise allowed by law. Specific Authority 624.308(1) FS. Law Implemented 624.307(1), 627.062(2), 627.331 FS. History–New 3-1-89, Formerly 4-72.006, 4-170.006, Amended_________. 69O-170.007 Annual Rate Filings. (1)(a) This rule applies to each insurer or rating organization subject to Section 627.0645, F.S. or duly authorized rating organization filing rates for, any line of property and/or casualty insurance to which Part I of Chapter 627, F.S., applies, as set forth in Section 627.021, F.S., and as defined in Sections 624.604 and 624.605, F.S., except workers’ compensation and employer’s liability insurance, and commercial property and casualty insurance, as defined in Section 627.0625(1), F.S., other than commercial multiple line and commercial motor vehicle. (b)1. Commercial Multiple Line insurance, for purposes of this rule, is defined as insurance that includes a combination of one or more property lines of insurance, e.g., fire and allied lines, and one or more casualty lines of insurance, e.g., general liability, burglary and theft. 2. Commercial Multiple Line insurance shall be interpreted as being the same as Commercial Multiple Peril insurance. 3. Commercial Multiple Line insurance or Commercial Multiple Peril insurance which is written on an indivisible premium basis is subject to this rule. 4. Divisible premium Commercial Multiple Peril policies shall not be subject to this rule. (c) A base rate filing considers the overall rate level and individual components of a line or subline being reviewed, although all are not necessarily revised in a base rate filing. A base rate filing may include, for example but is not limited to, a package modification factor. (d) For purposes of identifying filings submitted to the Office Department, a line of business shall be identified by one of the following, although additional identification may be used as needed:. 1. Commercial Automobile; Commercial Motor Vehicle 2. Commercial Multiple Peril Policy (with indivisible premium); Line Packages 3. Dwelling Fire and Liability; 4. Homeowners; 5. Mobile Homeowners; 6. Motor Home and Motorcycle; 7. Personal Inland Marine; 8. Personal Liability; and Personal Umbrella 9. Private Passenger Automobile. (b) This rule does not apply to risk retention groups as defined in Sections 627.943-.944, F.S.; professional liability self-insurance trust funds as defined in Section 627.356, F.S.; medical malpractice self-insurance trust funds as defined in Section 627.357, F.S.; or commercial self-insurance trust funds as defined in Section 624.462, F.S. (2) Each such insurer or each such rating organization filing rates for on behalf of one or more insurers shall make annual base rate filings with the Office department for each line or subline of insurance no later than 12 months after its previous certification or base rate filing effective date for new business. (a) In all cases, the new business effective date or dates as supplied to and as approved by the Office will be the applicable current effective date or dates. (b) All annual base rate filings are to be received by the Office no later than 12 months after the current effective date of the last base rate or certification filing. A filing will be considered received by the Office if it is physically in the possession of Insurance Regulation personnel at Tallahassee, Florida 32314-5320. (3)(a) Filings shall be submitted in accordance with the requirements of this rule. and, for 1. Ffilings submitted in accordance with paragraph subsections (4)(a) and (4)(b), below, shall demonstrate that the rates filed are not excessive, inadequate, or unfairly discriminatory, and for 2. Ffilings submitted in accordance with paragraph subsection (4)(b) (4)(c), below, shall demonstrate that the rates filings are actuarially sound and not inadequate. (b)1. The filings required by this rule shall be on an individual insurer company basis unless the rates for insurers companies within a group are derived from the pooled experience of those insurers companies. 2. If the rates for more than one insurer company within a group are derived from pooled experience, then the filing may be made on a multiple insurer company basis but the cover letter for the filing shall explicitly state what the rates are and what insurers companies are included in the group. Insurers may submit a filing on behalf of any combination of insurers within the insurers’ group, provided the effective dates are identical for every insurer and program identified in the filing. (c)1. The insurer shall submit all filings to the Office at https://iportal.fldfs.com, the industry portal to the Office’s I-File System, as adopted in Rule 69O-170.0155, F.A.C. affix the bar code labels to the upper right-hand corner of the required forms, and shall submit the forms to the Department at the following address: Office of Insurance Regulation, Post Office Box 5320, Tallahassee, Florida 32314-5320. Questions concerning bar code labels shall be directed to the Bureau of Data Control at (850)922-3149, ext. 2626. For additional bar code labels, the insurer shall submit a written request, which shall include the company’s most current FEIN number, and which shall be accompanied by payment in the amount of $30 per company, to the Bureau of Data Control at the post office box indicated above. 2. A filing shall be considered received by the Office on business days between the hours of 8:00 a.m. and 5:00 p.m. eastern time. Filings received after 5:00 p.m. shall be considered to be received the next business day. (d) Group Filings. For group filings, the insurer shall affix a bar code label for each company to the form. If the form is not large enough for all the bar code labels for the companies involved, the insurer shall use the back of the transmittal form. Original transmittal forms with bar codes may be copied for use with future filings. The insurer is encouraged to keep the original bar code transmittal form for future copying and mail only the copies. Companies shall submit only three copies of a group filing, provided the information for each company is identical. Three copies of each filing for each company in the group are not required when the information is identical. (4) The filing required by this rule shall be satisfied by either paragraph (a) or (b) below. one of the following methods: (a) A new or revised base rate filing prepared by or under the direct supervision of and signed by an actuary. The filing shall be signed by the actuary and shall which contains documentation demonstrating that the proposed rates are not excessive, inadequate, or unfairly discriminatory, and be submitted pursuant to the applicable rating laws and in compliance with Rule 69O-170.013, F.A.C. For purposes of this rule, “actuary” means an individual who is a member of the Casualty Actuarial Society. (b) By having new or revised base rate filings prepared and signed by the company ratemaker or by consultants, either of which shall have a minimum of 5 years’ experience in insurance ratemaking and by complying with Rule 69O-170.013, F.A.C. (b)1.(c) If no rate change is proposed, a filing which consists of a certification by an actuary or by an experienced company ratemaker or by a consultant that the existing base rate level produces rates which are actuarially sound and which are not inadequate, as defined in Section 627.062 or Section 627.0651, F.S., whichever is applicable. 2. Form OIR-B1-582, “Universal Standardized Data Letter, “as adopted in Rule 69O-170.0155, F.A.C. 3. Form OIR-B1-586, “Florida Property and Casualty – Annual Rate Filings Certification,” rev. 10/92, which is hereby as adopted in Rule 69O-170.0155, F.A.C., and incorporated by reference shall be completed in triplicate, including a properly affixed bar code, and accompanied by a stamped self-addressed envelope. 4. The data shall be on a direct basis. Identify whether the loss data includes LAE and/or IBNR. Certification of an existing rate level does not preclude making a base rate filing during the following 12 months. (c) If an insurer does not employ or otherwise retain the services of an actuary, as defined by Section 627.0645(8), F.S., the filing under paragraph (a) or (b) above shall: 1. Be prepared by a person meeting the requirements of Section 627.0645(5), F.S., herein referred to as a qualified ratemaker. 2. Be reviewed and signed by an employee of the insurer who is authorized to approve rate filings. 3. Include detailed information on the preparer’s experience to demonstrate compliance with Section 627.0645(5), F.S. 4. Include a certification of an officer of the insurer that the insurer does not employ or otherwise retain the services of an actuary. 5. If the submission does not contain the material required by this paragraph (c), it will result in the Office’s issuance of a Notice of Intent to disapprove. (d) By being a member or subscriber of a licensed rating organization to which the insurer has given rate filing authorization and which complies with the requirements of Section 627.0645, F.S. Deviations filed by an authorized insurer to any rating organization’s base rate filing shall not be subject to this rule. (d)1.(e) For purposes of this rule, a prospective loss cost filing, using the most recently approved loss costs, submitted to the Office by a duly authorized rating organization, may be considered as part of a base rate filing. 2. The factors for converting loss costs to rates shall be filed by the submitting insurer and approved by the Office. 3. All deviations from a rating or advisory organization’s loss costs are to be certified or adequately supported. 4. An insurer may choose either: a. Tto file and distribute final rate pages;, or b. Tto file or reference loss cost pages filed and distributed by a rating organization; or c. Tto file loss cost pages distributed by an advisory organization plus the insurer’s company’s factors used to convert the prospective loss costs to rates. 5. An insurer shall use Form OIR-B1-583, “Florida Expense Supplement Calculation of Insurer Loss Cost Multiplier,” as adopted in Rule 69O-170.0155, F.A.C., the following form, which is hereby adopted and incorporated by reference, in filing the factors to convert a rating or advisory organization’s prospective loss costs to rates and shall comply with Rule 69O-170.013, F.A.C.: Form OIR583, “Florida Expense Supplement Calculation of Company Loss Cost Multiplier,” rev. 10/92. (f) An insurer must be authorized by a rating or advisory organization to use its loss costs before it bases its rates on the rating or advisory organizations’ loss costs. When a rating organization converts from rates to loss costs for a particular line of business, the rating organization will cease filing rates on behalf of authorized insurers. When this happens, the insurer may have an annual base rate filing requirement for each line of business defined in this rule and these annual base rate filings shall be received by the Office no later than 12 months after the current effective date of the insurer’s or rating organization’s last base rate filing. Insurers shall keep in contact with their rating or advisory organizations and with the Office to determine when their annual filing requirement begins. (e)1.(g) A request for exemption pursuant to Section 627.0645(2)(b), F.S., shall include Form OIR-B1-584, “Florida Property and Casualty – Annual Rate Filing-Exemption,” as adopted in Rule 69O-170.0155, F.A.C. and shall be submitted through https://iportal.fldfs.com. After receiving a request to be exempt from the requirements of this rule, the Office shall, for good cause due to insignificant numbers of policies in force or to an insignificant premium volume, exempt a company, by line of coverage. A company shall submit in triplicate, including a properly affixed bar code, accompanied by a stamped, self-addressed envelope an exemption request on Form OIR-584, “Florida Property and Casualty – Annual Rate Filing-Exemption,” rev. 10/92, which is hereby adopted and incorporated by reference. 2. The exemption shall remain in effect for as long as there is not an increase in premium volume. (h) All forms adopted in this rule may be obtained from the Bureau of Property/Casualty Forms & Rates, Post Office Box 5320, Tallahassee, FL 32314-5320, and may be reproduced at will. All filings shall be sent to the Bureau of Property/Casualty Forms & Rates, Division of Insurer Services, Office of Insurance Regulation, Post Office Box 5320, Tallahassee, Florida 32314-5320. (5) A request for extension meeting the conditions of Section 627.0645(6), F.S., If a filing is still being prepared on the date it is required to be filed, the insurer may apply to the Office in writing for an extension of up to an additional 30 days in which to submit the filing. The request for an extension shall be received by the Office no later than 5:00 PM on the date the filing is due. The request for extension will be approved automatically upon receipt. (6) Nothing in this rule shall limit the Office’s authority to review rates at any time or to find that a rate or rate change is excessive, inadequate, or unfairly discriminatory pursuant to Section 627.062 or Section 627.0651, F.S. (7) In addition to the provisions regarding discontinuance of use of a policy policies form in Section 627.0645(1)(h), F.S., the Office is authorized to suspend or revoke an insurer’s certificate pursuant to Section 624.418, F.S., or to impose a fine pursuant to Section 624.4211, F.S., for failure to comply with this rule. (8) Each filing shall include a completed Form OIR-1436 (rev. 2/98), Annual Rate Filing Form, which is hereby adopted and incorporated by reference, and is available from the address in paragraph (4)(h). Specific Authority 624.308, 624.424(1)(c) FS. Law Implemented 624.307(1), 624.418(2), 624.4211, 624.424(1)(c), 627.021, 627.062, 627.0645, 627.0651, 627.221, 627.301 FS. History–New 12-25-90, Formerly 4-72.007, Amended 1-27-92, 3-9-93, 9-7-93, 12-17-00, Formerly 4-170.009, Amended __________. 69O-170.013 Filing Procedures for Property and Casualty Insurance Rates, Rules, Underwriting Guidelines, and Forms. (1)(a) The procedures in this rule apply to all insurance rate, rule, underwriting guidelines or form filings for property and casualty insurance as defined in Sections 624.604, 624.605, 634.011(8), 634.301(4), 634.401(14), 642.015(3)(5), 648.25(1), 635.011(1), and 627.826(1), F.S. (b) Underwriting guidelines for private passenger automobile, homeowners’ and mobile homeowners’ insurance, for both new and renewal business, shall be filed pursuant to this rule. (2)(a) A “rate filing” contains all the information submitted in the filing made by the insurer, plus any supplemental information received during the course of the Office’s review, for all purposes of the filing made under Section 627.062(2)(a) or 627.0651, F.S. The procedures in this rule supersede any other procedures relating to filing procedures and actuarial memoranda. All material submitted shall be legible. (3) Filing Submittal Requirements. (a) Complete rate, rule, underwriting guidelines for both new and renewal business, and form filings shall be submitted with the following information: 1. Form OIR-B1-582, “Universal Standardized Data Letter,” as adopted in Rule 69O-170.0155, F.A.C. 2. Cover letter that shall include, at a minimum:;and a. The purpose of the filing; b. For rate and rule filings, an identification as to whether the filing is made under “file and use” or “use and file”, including the proposed effective date of the rates or the date the rates were implemented; c. If this is a resubmission of a previous file, a brief explanation of the prior filing, including reference to the corresponding Florida filing log number shall be provided; d. For a rate filing for which a form is also being filed, identification of the corresponding filing log number for the form or when the form will be submitted; and 3. Explanatory memorandum which shall:. a. Explain the organization of the components of the filing; b. Identify and highlight the changes from the current situation; c. Include any explanation required by Rule 69O-170.006, F.A.C.; d. If there is no rate effect, a detailed explanation of how it was so determined or why it is believed that there is no rate effect. 4. For filings with a rate effect, an actuarial opinion and supporting memorandum prepared pursuant to Rule 69O-170.0135, F.A.C. 5. Filing procedures and content required for specific lines of business as delineated in the following rules: a. Rule 69O-170.014, F.A.C., (Homeowners and Mobile Homes); b. Rule 69O-175.003, F.A.C., (Private Passenger Auto); c. Rule 69O-170.0141, F.A.C., (Dwelling); d. Rule 69O-170.0142, F.A.C., (Commercial Residential/All Other Property & Casualty); e. Rule 69O-170.0143, F.A.C. (Professional Liability for Medical Malpractice); and 6. Manual pages formatted in compliance with subsection 69O-170.006(2), F.A.C. Subsequent to the initial filing, the insurer may defer submitting final amended manual pages until the Office concludes its analysis. Final approval will not occur until final manual pages have been submitted. (b) All filings shall: 1. Be submitted in the above order with the Universal Standardized Data Letter serving as a cover sheet; 1.2. Be separated into either rate/rule only or form only filings; and 2.3. Be separated by line of business in accordance with Rule 69O-170.006, F.A.C. (c) Group Filings. Insurers may submit a filing on behalf of any combination of insurers within the insurers’ group, provided the effective dates are identical for every insurer and the program is identified in the filing the information submitted in the filing is identical for every insurer identified in the filing and. (4) The following rules also apply to the specific rate/rule filing procedures: (a) Rule 69O-170.014, F.A.C., (Homeowners); (b) Rule 69O-175.003, F.A.C., (Private Passenger Auto), (c) Rule 69O-170.0141, F.A.C., (Dwelling), (d) Rule 69O-170.0142, F.A.C., (Commercial Residential/All Other Property & Casualty). (5) The Office maintains voluntary checklists for insurers’ information in properly complying with relevant statutes and rules. The completion of checklists does not preclude the Office from requiring additional information or further explanation of data. Filing checklists are for insurer information only. (4)(6)(a) All filings sent by U.S. Postal Service shall be addressed to: Property and Casualty Forms and Rates, Post Office Box 7700, Tallahassee, FL 32314-7700. (b) For delivery other than U.S. Postal Service or hand delivery, filings shall be addressed to: Bureau of Property and Casualty Forms and Rates, Room 233-A, Larson Building, 200 East Gaines Street, Tallahassee, FL 32399-0330. (c) Subsequent to July 1, 2003, Aall filings shall be submitted electronically to https://iportal.fldfs.com, the industry portal to the Office’s I-File System, as adopted in Rule 69O-170.0155, F.A.C. or by computer diskette meeting the compatibility requirements mandated by Section 624.424(1)(c), F.S. Deadlines for filing will not be extended due to shipping delays, format incompatibility, data corruption, or any other impediment which results from an election to file by diskette. (b) A filing shall be considered received by the Office on business days between the hours of 8:00 a.m. and 5:00 p.m. eastern time. Filings received after 5:00 p.m. shall be considered to be received the next business day. (5)(a) A rate filing shall contain documentation demonstrating that the proposed rates meet the standards and conditions of Section 627.062 or 627.0651, F.S., as applicable. (b) It is the responsibility of the insurer to ensure that the filing contains all the information and documentation the insurer wants considered that supports the rate requested. (c) A rate filing shall contain information and documentation sufficient for an actuary practicing in the same field to evaluate the work. (d) Any submission that does not contain the information and documentation required by subsection (3) above, or for which required filing forms have not been completed in their entirety, will result in the Office’s issuance of a Notice of Intent to disapprove. (6)(a) The Office may request additional information or clarification to evaluate the filing for compliance with applicable statutory provisions. (b) To allow the Office sufficient time to perform a proper review, the insurer shall submit by a date certain stated in a clarification letter any required additional information, explanation of data, or justification of assumptions. (c) Unless the date is extended by the Office, failure to adequately address the issues by the date stated in the clarification letter will result in a notice of intent to disapprove the filing by the Office. Specific Authority 624.308, 624.424(1)(c) FS. Law Implemented 624.307(1), 624.424(1)(c), 624.604, 624.605, 627.062, 627.0645, 627.0651 FS. History–New 3-30-92, Amended 3-9-93, 8-23-93, 10-3-94, 8-3-95, 10-2-96, 6-19-03, Formerly 4-170.013, Amended __________. 69O-170.0135 Actuarial Memorandum. (1) (a) An actuarial opinion and memorandum supporting the opinion shall state that the rates are not excessive, inadequate, or unfairly discriminatory and comply with the laws of this state. (b) If the opinion cannot be given, a complete explanation of the reason or qualifications shall be provided. (c) If the opinion and memorandum are prepared by a different individual from the person who prepared the prior filing, an explanation of the reason for this change shall be provided. (2)(a) The memorandum, along with any required online data and rate submission material, shall support and document the basis of the opinion. (b) It is not necessary to repeat, within the memorandum, any data that has been submitted through the online collection system; however, the memorandum shall so indicate and shall provide any necessary explanation. (c) If an insurer, in addition to the completion of the required rate indications component of the I-File System, chooses to develop the proposed rates by using data or a method that is different from that which underlies the rate indications component of the I-File System, the memorandum shall contain detailed documentation and development of the method, assumptions and proposed rates, detailed documentation that the method is consistent with generally accepted and reasonable actuarial techniques, and that the resulting rates are not excessive, inadequate or unfairly discriminatory. The insurer may also provide any explanation for the Office to consider in the review of the filing pursuant to Section 627.062 or 627.0651, F.S., as to why it believes that the methodology or technique used in the filing is more appropriate for the filing than the methodology or technique used in the I-File System indications. The use of different data or method does not create a presumption of the appropriateness or inappropriateness of either method. (d) The memorandum shall be such that an actuary qualified in the same practice area in which the filing is made could evaluate the reasonableness of the work. (e) Each of the following items that are pertinent to the filing shall be identified and discussed: 1. The source and description of the experience data used, including homogeneity and reasonableness of the data used as a statistical basis to measure the expected claim costs over the rating period; 2. Verification that the data used does not include punitive damage awards; 3. Operational issues, including changes in underwriting guidelines as indicated in paragraph 69O-170.006(4)(b), F.A.C., and other influences on the experience data that will impact the expected experience during the rating period, including large non-recurring claims and loss experience pertaining to actual catastrophic events, how these compare to expected, and how they are incorporated into the rate development; 4. Premium and loss trends; 5. Basis of the credibility standard for complementing the experience data, along with support for the selection of that standard whenever the standard has changed from the previous filing; 6. Average statewide rate change, and an exhibit showing the ranges of impact on policyholders of the changes proposed in the current filing and the factors affecting the range of impact; 7. The effect of reinsurance or any other method of smoothing claim volatility and how it was included in the rate development; 8. Expense experience and anticipated expense needs for the rating period; 9. Analysis of investment income and return on surplus and how it was included in the rate analysis, including demonstration of compliance with the provisions of Rule 69O-170.003 or 69O-175.001, F.A.C.; 10. Disclosure and explanation of the basis of judgment made on assumptions or resulting rates; and 11. The expense factors in each rate filing, which shall be divided into the following categories: a. Commissions and brokerage; b. Other acquisition expenses; c. General expenses; d. Premium taxes; e. Miscellaneous licenses and fees; f. Profit and contingencies; g. Reinsurance costs; and h. Other expenses. (3) Standards. (a) Premium on-leveling methodology and calculations shall be clearly documented. An overall rate level history for the pertinent past shall be provided. Insurers not using this history in their calculations shall fully describe the method used. The insurer shall provide the policy term distribution, e.g., what percentage of the policies have been annual policies versus six-month policies. (b) If a model accepted by the Florida Commission on Hurricane Loss Projection Methodology is used, it shall be the current version of the model, however, the immediate prior version of the model accepted by the Commission of the model may be used if the filing is submitted no more than three months after the date the current version is accepted by the Commission. (c) The use of contingent commissions as supporting data for rate changes is prohibited unless: 1. There is a contractual arrangement between the insurer and its agents concerning the payment of contingent commissions; and 2. The insurer demonstrates that it is not paying contingent commissions from profits higher than anticipated in its filings. (d) The ultimate incurred losses shall be based on best estimate assumptions, i.e., the assumptions the actuary expects to be realized over the period for which the rates are anticipated to be in effect. Specific Authority 624.308(1) FS. Law Implemented 624.307, 627.062, 627.0651 FS. History–New __________. 69O-170.014 Homeowners Insurance Ratemaking and Rate Filing Procedures. (1)(a) This rule shall apply to all homeowners insurance rates filed pursuant to Section 627.062, F.S. (b) For purposes of this rule, reference to homeowners insurance shall include mobile homeowners insurance written on homeowners type policies and mobile homeowners insurance written on auto physical damage type policies. (c) The information required by this rule shall be included as a required component of the filing made pursuant to subsection 69O-170.013(3), F.A.C. (2) Homeowners and Mobile Homeowners Filing Submittal Requirements: (a) Complete rate, rule, rate/rule and underwriting guidelines shall be submitted with the following information: 1. Form OIR-B1-582, “Universal Standardized Data Letter,” as adopted in Rule 69O-170.015, F.A.C.; 2. Cover letter; and 3. Explanatory memorandum. (a)(b)1. Each insurer writing homeowners insurance, including mobile homeowners insurance written on homeowners type policies and mobile homeowners insurance written on auto physical damage type policies, in Florida shall file electronically the information with the Office such information as required by the I-File System and the Homeowners’ Rate Collection System (HRCS) as adopted in Rule 69O-170.0155, F.A.C., at https://iportal.fldfs.com. the Office by using the computer software provided to insurers by the Office. (b) Required supporting documentation referenced in the I-File System and HRCS shall be provided. (c) Accurate entry of information into the rate indications workbook component of the I-File System will result in an aggregate average statewide rate indication. The accuracy and integrity of the information provided shall be the responsibility of the insurer. 2. Insurers may electronically submit their rating data by completing their filing on-line through the Office’s Internet Filing System (IFS) and the Rate Collection System (RCS) at https://iportal.fldfs.com or by utilizing the Homeowners Rate Collection System (HRCS) software provided to insurers by the Office on its web site. (c) All filings sent by U.S. Postal Service shall be addressed to: Property and Casualty Forms and Rates, Post Office Box 7700, Tallahassee, FL 32314-7700. (d) For delivery other than U.S. Postal Service or hand delivery, filings shall be addressed to: Bureau of Property and Casualty Forms and Rates, Room 233-A Larson Building, 200 East Gaines Street, Tallahassee, FL 32399-0330. (e) Subsequent to July 1, 2003, all filings shall be submitted electronically to https://iportal.fldfs.com or by computer diskette meeting the compatibility requirements mandated by Section 624.424(1)(c), F.S. Deadlines for filing will not be extended due to shipping delays, format incompatibility, data corruption, or any other impediment which results from an election to file by diskette. (f) All filings shall be separated by line of business in accordance with Rule 69O-170.006, F.A.C. (g) All manual pages shall be formatted in compliance with subsection 69O-170.006(3), F.A.C. (3) Any submission which is not completed according to the above referenced instructions, or is missing any of the properly completed forms, including supporting documentation, shall not constitute a filing pursuant to Section 627.062, F.S., and shall be returned to the insurer as “incomplete”. (4) Group Filings. Insurers may submit a filing on behalf of any combination of insurers within the insurers’ group provided the information submitted in the filing is identical for every insurer identified in the filing. (5)(a) The submission of data outlined on the homeowners and mobile homeowners checklist does not preclude the Office from requiring additional information or further explanation of data. (b) The insurer shall submit any required additional information or further explanation of data by a date certain stated in a clarification letter, to allow the Office sufficient time to perform a proper review. (c) Failure to correct the deficiencies by the date stated in the clarification letter will result in a notice of intent to disapprove the filing by the Office. (3) The information identified in subsections (4) through (9) below is submitted within the I-File System and HRCS collection indicated in subparagraph (2)(a)1. above. (4)(6)(a) Each rate filing shall contain either: 1. through 2. No change. (b)1. No change. 2. This subsection shall not apply if: a. aA rate change is filed in response to law changes which relate to specific types of policies; or b. A rate change is filed in response to specific factual developments or circumstances that are reasonably expected to affect only certain types of policies for which the changes are filed. (5)(7)(a) Each rate filing which proposes changes to base rates as to any policy for which rates vary by territory shall contain either: 1. through 2. No change. (b) No change. (6)(8) The earned premiums and incurred losses included in the rate level indications shall be direct calendar/accident year or direct fiscal/accident year, Florida-only data. Any other data which the insurer believes to be pertinent to the filing may also be provided. (9) The following forms, as adopted in Rule 69O-170.015, F.A.C., are included in the Homeowners Rate Filing Collection Systems provided by the Office: (a) Form OIR-B1-1102, "Florida Homeowners Rating Examples/Annual Rates"; (b) Form OIR-B1-1103, "Florida — Statewide Rate Level Effect/Homeowners", with its instructions; and (c) Form OIR-B1-1104, "Florida — Rate Level Effect by Type by Territory/ Homeowners", with its instructions. (10) through (12) renumbered (7) through (9) No change. Specific Authority 624.308(1) FS. Law Implemented 624.307(1), 624.424, 627.062, 627.0645 FS. History–New 8-23-93, Amended 10-3-94, 10-2-96, 3-31-98, 1-25-99, 6-19-03, Formerly 4-170.014, Amended__________. 69O-170.0141 Dwelling Insurance Ratemaking and Rate Filing Procedures. (1)(a) This rule shall apply to all dwelling fire and extended coverage insurance rates filed pursuant to s.Section 627.062, F.S. (b) For purposes of this rule, reference to dwelling fire insurance shall include mobile home dwelling insurance written on dwelling fire type policies. (c) The information required by this rule shall be included as a required component of the filing made pursuant to subsection 69O-170.013(3), F.A.C. (2) Dwelling Fire and Extended Coverage Insurance Filing Submittal Requirements: (a) Complete rate, rule, rate/rule and underwriting guidelines shall be submitted with the following information: 1. Form OIR-B1-582, “Universal Standardized Data Letter,” as adopted in Rule 69O-170.015, F.A.C.; 2. Cover letter; and 3. Explanatory memorandum. (a)(b)1. Each insurer writing dwelling fire and extended coverage in Florida shall file electronically with the Office such information as required by the Office by the I-File System and the Dwelling Rate Collection System (DRCS), as adopted in Rule 69O-170.0155, F.A.C., at https://iportal.fldfs.com. using the computer software provided to insurers by the Office. (b) Required supporting documentation referenced in the I-File System and DRCS shall be provided. (c) Accurate entry of information into the rate indications workbook component of the I-File System will result in an aggregate average statewide rate indication. The accuracy and integrity of the information provided shall be the responsibility of the insurer. 2. Insurers may electronically submit their rating data by completing their filing on-line through the Office’s Internet Filing System (IFS) and the Rate Collection System (RCS) at https://iportal.fldfs.com or by utilizing the Dwelling Rate Collection System (DRCS) software provided to insurers by the Office on its web site. (c) All filings sent by U.S. Postal Service shall be addressed to: Property and Casualty Forms and Rates, Post Office Box 7700, Tallahassee, FL 32314-7700. (d) For delivery other than U.S. Postal Service or hand delivery, filings shall be addressed to: Bureau of Property and Casualty Forms and Rates, Room 233-A, Larson Building, 200 East Gaines Street, Tallahassee, FL 32399-0330. (e) Subsequent to July 1, 2003, all filings shall be submitted electronically to https://iportal.fldfs.com or by computer diskette meeting the compatibility requirements mandated by Section 624.424(1)(c), F.S. Deadlines for filing will not be extended due to shipping delays, format incompatibility, data corruption, or any other impediment which results from an election to file by diskette. (f) All filings shall be separated by line of business in accordance with Rule 69O-170.006, F.A.C. (g) All manual pages shall be formatted in compliance with subsection 69O-170.006(3), F.A.C. (3) Any submission which is not completed according to the above referenced instructions, or is missing any of the properly completed forms, including supporting documentation, shall not constitute a filing pursuant to Section 627.062, F.S., and shall be returned to the insurer as “incomplete.” (4) Group Filings. Insurers may submit a filing on behalf of any combination of insurers within the insurers’ group provided the information submitted in the filing is identical for every insurer identified in the filing. (5)(a) The submission of data outlined on dwelling fire and extended coverage checklists does not preclude the Office from requiring additional information or further explanation of data. (b) The insurer shall submit the required additional information or further explanation of data by a date certain stated in a clarification letter, to allow the Office sufficient time to perform a proper review. (c) Failure to correct the deficiencies by the date stated in the clarification letter will result in a notice of intent to disapprove the filing by the Office. (3) The information identified in subsections (4) through (9) below is submitted within the I-File System and DRCS collection indicated in paragraph (2)(a) above. (4)(6)(a) Each rate filing shall contain either: 1. through 2. No change. (b)1. No change. 2. This subsection shall not apply if: a. aA rate change is filed in response to law changes which relate to specific types of policies; or b. A rate change is filed in response to specific factual developments or circumstances that are reasonably expected to affect only certain types of policies for which the changes are filed. (5)(7) No change. (6)(8) The earned premiums and incurred losses included in the rate level indications shall be direct calendar/accident year or direct fiscal/accident year, Florida-only data. Any other data which the insurer believes to be pertinent to the filing may also be provided. (9) The following forms, as adopted in Rule 69O-170.015, F.A.C., are included in the Dwelling Rate Collection Systems provided by the Office: (a) Form OIR-B1-1193, "Florida Dwelling Rating Examples/Annual Rates"; (b) Form OIR-B1-1194, "Florida – Statewide Rate Level Effect/Dwelling", with its instructions; and (c) Form OIR-B1-1195, "Florida – Rate Level Effect by Type by Territory/Dwellings", with its instructions. (10) through (12) renumbered (7) through (9) No change. Specific Authority 624.308(1) FS. Law Implemented 624.307(1), 627.062 FS. History–New 10-2-96, Amended 3-31-98, 1-25-99, 6-19-03, Formerly 4-170.0141, Amended __________. 69O-170.0142 Ratemaking and Rate Filing Procedures for Commercial Residential Insurance and All Other Lines. (1)(a) The procedures in this rule apply to all commercial residential insurance rates filed pursuant to Section 627.062, F.S., and all other lines of property and casualty insurance as defined in Section 624.604 and 624.605, F.S., except that this rule does not apply to workers’ compensation insurance as defined in Section 624.605(1)(c), Florida Statutes. (b) This rule does not apply to medical malpractice coverage which is subject to Rule 69O-170.0143, F.A.C., or workers’ compensation insurance as defined in Section 624.605(1)(c), F.S. (c)(b) No change. (2) The fFiling sSubmittal rRequirements in this rule are in addition to the information required by subsection 69O-170.013(3), F.A.C., and shall be included as a required component of the filing made pursuant to subsection 69O-170.013(3), F.A.C. (a) Complete rate, rule, underwriting guidelines, and form filings shall be submitted with the following information: 1. Form OIR-B1-582, "Universal Standardized Data Letter," as adopted in Rule 69O-170.0155, F.A.C. 2. Cover letter; and 3. Explanatory memo. (b) All filings shall: 1. Be submitted in the above order with the Universal Standardized Data Letter serving as a cover sheet; 2. Be separated into either rate/rule only or form only filings; 3. Be separated by line of business in accordance with Rule 69O-170.006, F.A.C.; and 4. All manual pages shall be formatted in compliance with subsection 69O-170.006(2),(3), F.A.C. (c) Group Filings. Insurers may submit a filing on behalf of any combination of insurers within the insurers’ group, provided the information submitted in the filing is identical for every insurer identified in the filing. (3) Any submission which is not completed according to the above referenced instructions or is missing any of the properly completed forms, including supporting documentation, shall not constitute a filing pursuant to Section 627.062, F.S., and shall be returned to the insurer as “incomplete”. (4)(a) The submission of data outlined on the property and casualty commercial lines checklist does not preclude the Office from requiring additional information or further explanation of data. (b) The insurer shall submit the required additional information or further explanation of data by a date certain stated in a clarification letter, to allow the Office sufficient time to perform a proper review. (c) Failure to correct the deficiencies by the date stated in the clarification letter will result in a notice of intent to disapprove the filing by the Office. (5)(a) All filings sent by U.S. Postal Service shall be addressed to: Property and Casualty Forms and Rates, Post Office Box 7700, Tallahassee, FL 32314-7700. (b) For delivery other than U.S. Postal Service or hand delivery, filings shall be addressed to: Bureau of Property and Casualty Forms and Rates, Room 233-A Larson Building, 200 East Gaines Street, Tallahassee, FL 32399-0330. (c) Subsequent to July 1, 2003, all filings shall be submitted electronically to https://iportal.fldfs.com or by computer diskette meeting the compatibility requirements mandated by Section 624.424(1)(c), F.S. Deadlines for filing will not be extended due to shipping delays, format incompatibility, data corruption, or any other impediment which results from an election to file by diskette. (3)(6)(a) Each rate filing shall contain either: 1. through 2. No change. (b)1. No change. 2. This subsection shall not apply if a rate change is filed in response to law changes which relate to specific types of policies or if a rate change is filed in response to specific factual developments or circumstances that are reasonably expected to affect only certain types of policies for which the changes are filed. (4)(7)(a) If the filing adopts a rating organization’s prospective loss costs, the filing shall include Form OIR-B1-583 (pages 1 and 2), “Florida Expense Supplement Calculation of Insurer Company Loss Cost Multiplier” as adopted in Rule 69O-170.0155, F.A.C. (b) through (c) No change. (d) The data shall identify whether the loss data includes LAE (Loss Adjustment Expense) and/or IBNR (Incurred But Not Reported). (5)(8) No change. (6)(a)(9) The earned premiums and incurred losses included in the rate level indications shall include Florida-only data. (b) An insurer shall prepare separate indications for those policies on an occurrence basis and for those policies on a claims-made basis. (c) The premium and loss data supporting a rate level indication for policies on an occurrence basis shall be stated on an accident year basis. (d) The premium and loss data supporting a rate level indication for policies on a claims-made basis shall be stated on a report year basis. be accident year, Florida-only data. Any other data which the insurer believes to be pertinent to the filing may also be provided. The insurer shall provide the logical connection between such other data and the subject matter of the filing. (10) through (11) renumbered (7) through (8) No change. (12) Each insurer shall include in its rate filings: (a) A separate exhibit listing that portion of the final rates/premium allocated to conflagration, hurricane, or other catastrophe hazards. (b) An estimate of the total dollar amount allocated to such conflagration, hurricane, or other catastrophe hazards for the 12 month period beginning with the effective date of the applicable filing. (c) A rate filing for residential property insurance shall be separated into 2 components, rates for: 1. Hurricane coverage; and 2. All other coverages. (13) renumbered (9) No change. Specific Authority 624.308(1) FS. Law Implemented 624.307(1), 627.062, 624.604, 624.605 FS. History–New 10-2-96, Formerly 4-170.0142, Amended__________. 69O-170.0143 Ratemaking and Rate Filing Procedures for Liability Insurance for Medical Malpractice. (1)(a) This rule shall apply to all medical malpractice insurance rates filed pursuant to Section 627.062, F.S., (b) The information required by this rule shall be included as a required component of the filing made pursuant to subsection 69O-170.013(3), F.A.C. (c) For purposes of this rule, reference to liability insurance for medical malpractice shall include insurance on the following types of risks: 1. Hospitals licensed under Chapter 395, F.S.; 2. Physicians licensed under Chapter 458, F.S.; 3. Osteopathic physicians licensed under Chapter 459, F.S.; 4. Podiatric physicians licensed under Chapter 461, F.S.; 5. Dentists licensed under Chapter 466, F.S.; 6. Chiropractic physicians licensed under Chapter 460, F.S.; 7. Naturopaths licensed under Chapter 462, F.S.; 8. Nurses licensed under Chapter 464, F.S.; 9. Midwives licensed under Chapter 467, F.S.; 10 Clinical laboratories registered under Chapter 483, F.S.; 11. Physician assistants licensed under Chapters 458, F.S., or 459, F.S.; 12. Physical therapists and physical therapist assistants licensed under Chapter 486, F.S.; 13. Health maintenance organizations certificated under part I of Chapter 641, F.S.; 14. Ambulatory surgical centers licensed under Chapter 395, F.S.; 15 Other medical facilities as defined in subparagraph 627.351(4)(h)2., F.S.; 16. Individuals or facilities licensed under Chapter 400, F.S.; 17.a. Blood banks, b. Plasma centers, c. Industrial clinics, and d. Renal dialysis facilities; 18.a. Professional associations, b. Partnerships, c. Corporations, d. Joint ventures, or e. Other associations for professional activity by health care providers; or 19. Any other liability insurance covering errors or omissions which may result in bodily injury. (2) All filings shall contain: (a) Either Form OIR-B1-583 (pages 1 and 2) or Form OIR-B1-595 as adopted in Rule 69O-170.0155, F.A.C., as applicable. (b)1. A list of each of the insurer’s programs or types of policies within the Medical Malpractice line of business and whether each program or policy type is provided on an occurrence basis, a claim-made basis, or on both bases. 2. A statement by the insurer as to: a. Whether each program or policy type is subject to the annual rate filing required under Section 627.062(7)(f), F.S.; and b. Whether that annual rate filing is being made under the current rate filing or has been made under a prior submission. 3. A list of the insurer’s programs or types of policies which are rated based on exposure units expressed in Physician Years. (c) Adoption of Loss Costs Filed by a Rating Organization. A filing which adopts the prospective loss costs promulgated by a rating organization and approved for use by the Office shall include Form OIR-B1-583 (pages 1 and 2), “Florida Expense Supplement Calculation of Insurer Loss Cost Multiplier” as adopted in Rule 69O-170.0155, F.A.C. (d) Rate Filings not involving the adoption of Loss Costs. Insurers shall provide the following: 1.Ratemaking Methodology: a. The actuarial memorandum and the supporting exhibits define a standard ratemaking methodology. The proposed rates and/or rate changes should be the result of the ratemaking methodology operating on the insurer's data. b. An insurer shall establish a standard ratemaking methodology and utilize it consistently over time. However, an insurer may elect to change its standard ratemaking methodology. If an insurer does so, it shall thoroughly document the reasons for the change. 2. Judgment: An insurer may employ its judgment and elect to depart from its ratemaking methodology. If an insurer does so, it shall thoroughly document the reasons for the departure from its standard ratemaking methodology. 3. Loss Data: a. Programs or policy types written on an occurrence basis shall present the following loss data on an accident year basis: (I) Direct losses paid to date on reported claims; (II) Case basis estimates of unpaid direct losses on reported claims; (III) The total number of reported claims. b. Programs or policy types written on a claims-made basis shall present the following loss data on a report year basis: (I) Direct losses paid to date on reported claims. (II) Case basis estimates of unpaid direct losses on reported claims. (III) The total number of reported claims. 4. Allocated Loss Adjustment Expense Data: An insurer may, at its option: a. Include direct paid and unpaid allocated loss adjustment expenses with direct paid and unpaid losses and indicate that the data includes both direct losses and direct allocated loss adjustment expenses; or b. Present direct paid and unpaid allocated loss adjustment expenses separately from direct paid and unpaid losses. 5. Actuarial Adjustments to Losses and Allocated Loss Adjustment Expenses. Filings shall consider the following adjustments to losses and allocated loss adjustment expenses: a. Loss Development; b. Adjustment for known changes in claim costs and claim frequency; d. Unallocated Loss Adjustment Expenses.c. Adjustment for anticipated future changes in claim costs and/or claim frequency; 6. Premium and Exposure Data: a. Filings which utilize a Loss Ratio approach to ratemaking shall provide collected direct written premium and collected direct earned premium; b. Filings which utilize a Pure Premium approach to ratemaking shall provide direct earned exposure measured in Physician Years; c. An insurer may also utilize other direct earned exposure units the insurer believes will support its proposed rate change. 7. Actuarial Adjustments to Premium and Exposure Data a. Filings based on a Loss Ratio approach shall clearly demonstrate: (I) How collected premium has been adjusted to the current rate level. (II) That the losses utilized in the filing were generated by the earned premium considered in the filing. b. Filings based on a Pure Premium approach shall clearly demonstrate: (I) That base-equivalent exposures, if utilized, have been determined using the current rating plan. (II) That the losses utilized in the filing were generated by the earned exposure utilized in the filing. 8. Expense (other than loss adjustment expenses) Data: a. A rate filing, other than the adoption of loss costs, shall include Form OIR-B1-595, “Florida Expense Supplement for Independent Rate Filings” as adopted in Rule 69O-170.0155, F.A.C. b. All expense data shall be presented on a direct basis: (I) Commission/Brokerage expense ratios, Premium Tax ratios, and Other Tax ratios shall be determined as ratios to direct written premium. (II) General Expense ratios and Other Acquisition Expense ratios shall be determined as ratios to direct earned premium. 9. Credibility: The filing shall contain a thorough explanation of how the concept of credibility, including the use of accident-year weights or report-year weights, has been incorporated into the filing. (e)1. In addition to the direct ratemaking approach in subsection (5), an insurer may elect to include the costs of reinsurance in a rate filing. 2. Where the insurer elects to do so, the cost of reinsurance shall consider: a. All reinsurance contracts related to the subject matter of the filing; b. The amount to be paid to the reinsurer; c. Ceding commissions to be paid to the insurer by the reinsurer; d. Expected reinsurance recoveries; and e. Other relevant information specifically relating to cost such as a retrospective profit sharing agreement between the insurer and the reinsurer. (f) Actuarial Documentation Required. 1. The actuarial memorandum contained in the filing shall describe in detail how the proposed rates have been derived from the experience presented. 2. The filing shall also contain actuarial exhibits that provide the details of all the calculations involved. The exhibits shall provide adequate documentation and footnotes to facilitate a thorough review of the calculations by the Office. Specific Authority 624.308(1) FS. Law Implemented 624.307, 627.062, 624.604, 624.605 FS. History–New__________. 69O-170.0155 Forms. The following forms are hereby adopted and incorporated by reference: (1)(a) OIR-B1-582, “Universal Standardized Data Letter,” (Rev. 10/04 07/03). (b) Form OIR-B1-583, “Florida Expense Supplement Calculation of Insurer Company Loss Cost Multiplier,” (Rev. 04/0407/03). (c) OIR-B1-584, “Florida Property and Casualty – Annual Rate Filing-Exemption,” (Rev. 07/03). (d) OIR-B1-586, “Florida Property and Casualty – Annual Rate Filing Certification,” (Rev. 07/03). (e)(c) Form OIR-B1-595, “Florida Expense Supplement for Independent Rate Filings,” (Rev. 07/03). (f) OIR-B1-HRCS, “Homeowners’ Rate Collection System (HRCS),” (07/03). (g) OIR-B1-DRCS, “Dwelling Rate Collection System (DRCS),” (07/03). (h) OIR-B1-ARCS, “Automobile Rate Collection System (ARCS),” (07/03). (i) OIR-B1-RIWBK, “Personal Lines Standardized Rate Indications Workbook,” (07/04). (j) OIR-B1-IFILE, “I-File,” (11/04). (d) Form OIR-B1-1102, “Florida Homeowners Rating Examples/Annual Rates,” (Rev. 07/03). (e) Form OIR-B1-1103, “Florida – Statewide Rate Level Effect/Homeowners,” with its instructions, (Rev. 07/03). (f) Form OIR-B1-1104, “Florida – Rate Level Effect by Type by Territory/ Homeowners,” with its instructions, (Rev. 07/03). (g) Form OIR-B1-1193, “Florida Dwelling Rating Examples/Annual Rates,” (Rev. 07/03). (h) Form OIR-B1-1194, “Florida – Statewide Rate Level Effect/Dwelling,” with its instructions, (Rev. 07/03). (i) Form OIR-B1-1195, “Florida – Rate Level Effect by Type by Territory/Dwellings,” with its instructions, (Rev. 07/03). (k)(j) Effective March 1, 2007, OIR-B1-1655, “Notice of Premium Discounts for Hurricane Loss Mitigation,” (Rev. 3/07) is adopted and incorporated herein by reference. (2) All Office of Insurance Regulation forms may be obtained from: (a) The Office’s Department of Financial Service’s web site located at https://www.floir.com https://www.fldfs.com; or (b) The Bureau of Property and Casualty Product Review Forms and Rates, Office of Insurance Regulation, Larson Building, Tallahassee, FL 32399-0330, (850)413-3146. Specific Authority 624.308(1), 627.711 FS. Law Implemented 624.307(1), 624.424, 627.062, 627.0645, 627.711 FS. History–New 6-19-03, Formerly 4-170.0155, Amended 2-23-06,________.


	A copy of the agenda may be obtained by contacting: The Governor and Cabinet Website at http://www.myflorida.com/myflorida/cabinet/mart.html. The agenda should be available approximately one week before the cabinet meeting.

PRINT PUBLISH DATE:	7/6/2007 Vol. 33/27


REFERENCE MATERIALS:	No reference(s).

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Overview