Oregon Administrative Rules
Chapter 836 - DEPARTMENT OF CONSUMER AND BUSINESS SERVICES, INSURANCE REGULATION
Division 42 - RATES AND RATEMAKING
Section 836-042-0220 - Filing Requirements and Procedural Rules
Universal Citation: OR Admin Rules 836-042-0220
Current through Register Vol. 63, No. 9, September 1, 2024
(1) Before issuing any policies to group members that are to be rated by the combined experience of the group:
(a) The insurer must file the following with
the Director for each group:
(A) The name and
nature of the organization to which employers in the group belong;
(B) A copy of documentation forming the
organization;
(C) The number of
employers in the organization;
(D)
The number of covered workers employed by employers that have signed
consent-to-group-rating forms;
(E)
An explanation of how the grouping of employers is likely to improve accident
prevention and claims handling and reduce expenses;
(F) A specific description of how the
combined experience of the group will be used for rating group members;
and
(G) The initial group
anniversary rating date; and
(b) The insurer must maintain a listing of
employers in the organization that have signed consent-to-group-rating forms
and make the listing available to the Director upon request.
(2) If the combined experience of a group of employers is used for experience rating, the following standards govern a group established under this rule:
(a) The supplemental modification factor
shall be calculated 90 days in advance of the group anniversary rating date
using the experience of employers that participated in the group during the
experience rating base period. The experience to be combined is the experience
of the individual employers for the policy year or years that they participated
in the group plan. The employers participating in the group during the base
period that also are participating at the time of the supplemental rating
calculation must be at least 50 percent of the current participants.
(b) A group must meet at least one of the
following conditions at the time of the supplemental rating calculation:
(A) Total annual standard premium prior to
the supplemental modification of $250,000 or greater; or
(B) At least 50 participating
employers.
(c) The
insurer of an organization or another insurer may request approval from the
Director under section (1) of this rule to form a new group that will be
experience-rated if the organization is composed of a group of employers that
satisfies all requirements of ORS
737.316, if the employers are
participants in an existing group that is experience-rated based on the
combined experience of participants in the existing group and if the employers
have signed consent to group rating forms for the formation of a new group.
Formation of a group under this subsection is subject to the requirements of
subsection (e) of this section.
(d)
An insurer may request approval from the Director under section (1) of this
rule to form a new group that will be experience-rated if the organization to
which the members of the new group belong is composed of a group of employers
that satisfies all requirements of ORS
737.316, if the organization has
been in existence for one or more years, if more than 50 percent of the members
have been members of the organization for one or more years, and if the
employers have signed forms giving consent to group rating for the formation of
a new group. Formation of a group under this subsection is subject to the
requirements of subsection (e) of this section.
(e) The requirements for formation of a new
group as provided in subsection (c) or (d) of this section include the
following:
(A) The group experience rating
supplemental modification factors shall be calculated as follows:
(i) The supplemental modification factor that
applies on the new group's initial anniversary rating date shall use all the
experience during the experience rating base period of each employer who has
signed a consent to group rating form for the formation of the new
group.
(ii) The supplemental
modification factor that applies on the new group's second anniversary rating
date shall use all the experience during the experience rating base period of
each employer who has signed a consent to group rating form for the formation
of the new group and each employer who began participating in the group
effective prior to the time of the second supplemental modification factor
calculation.
(iii) The supplemental
modification factors that apply on the new group's third and fourth anniversary
rating dates shall use all the experience during the experience rating base
period of the employers participating in the group at the time of the
supplemental modification factor calculation and the experience for the policy
years during the experience rating base period that each employer participated
in the new group for those employers who previously participated in the group
but are not participants at the time of the calculation.
(B) The supplemental modification factor
shall be calculated 90 days in advance of the group anniversary rating date,
and for the second and subsequent supplemental rating calculations the
employers participating in the group during the base period which also are
participating at the time of the supplemental rating calculation must be at
least 50 percent of the current participants.
(C) Notwithstanding paragraphs (A) and (B) of
this subsection, for a new group formed in accordance with subsection (c) or
(d) of this section, the supplemental modification factors effective on the new
group's initial anniversary rating date and on the new group's second
anniversary rating date shall not be less than the simple average of the
current supplemental modification factors for all approved experience rating
groups as verified by the licensed rating organization during the previous four
calendar quarters.
(f)
From one group rating anniversary to the next, a supplemental experience
modification factor for a group shall not increase by more than the greater of
0.01 or 50 percent of the difference between the factor and 1.00, or decrease
by more than the greater of 0.05 or 50 percent of the difference between the
factor and 1.00. This limitation does not apply if the supplemental
modification factor calculated for a group before this limitation is 1.00 or
greater for three consecutive group rating anniversaries or if supplemental
experience rating factors are not applied to a group for a period of one or
more years.
(3) If the combined experience of a group of employers is used for premium discounting, the discount must be determined from the actual premium of all participating employers.
(4) The effective date of a proposal by an insurer to combine the experience of a group of employers shall be the date specified in the filing required under section (1) of this rule, but not sooner than 30 days after the filing is received by the Director. The Director may approve an earlier effective date, upon written request by the insurer, but the date shall not precede the date the filing was received. If, within the 30-day period, the Director finds the proposal does not meet the standards and requirements of ORS Chapter 737, the Director shall notify the insurer that the proposal has been disapproved, stating the basis for such action, and the proposal shall not become effective. If, following the 30-day period, the Director finds the grouping proposal does not satisfy the requirements and standards of ORS Chapter 737, the Director may proceed according to 737.336(2), 737.215, and 737.045 to disapprove the group rating.
(5) Forty-five days before each group anniversary rating date after the initial effective date:
(a) The insurer must file with the Director
for review according to the preceding paragraph the following information for
each grouping of employers:
(A) The number of
employers in the organization;
(B)
The number of covered workers employed by employers participating in the group;
and
(C) A specific description of
how the combined experience of the group will be used for rating group members;
and
(b) The insurer must
maintain a listing of employers participating in the group and make the list
available to the Director upon request.
Stat. Auth.: ORS 731.244 & 737.316
Stats. Implemented: ORS 737.316
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