Virginia Administrative Code
Title 14 - INSURANCE
Agency 5 - STATE CORPORATION COMMISSION, BUREAU OF INSURANCE
Chapter 130 - RULES GOVERNING THE FILING OF RATES FOR INDIVIDUAL AND CERTAIN GROUP ACCIDENT AND SICKNESS INSURANCE POLICY FORMS
Section 14VAC5-130-70 - Filing a rate revision
Universal Citation: 4 VA Admin Code 5-130-70
Current through Register Vol. 41, No. 3, September 23, 2024
A. Each rate revision submission shall include (i) a new rate sheet, (ii) an actuarial memorandum, and (iii) all information required in SERFF.
B. The actuarial memorandum shall contain the following information:
1. A description of
the type of policy, including benefits, renewability, issue age limits, and if
applicable, whether the policy includes grandfathered or nongrandfathered plans
or both.
2. The scope and reason
for the premium or rate revision.
3. A comparison of the revised premiums with
the current premiums, including all percentage rate changes and any rating
factor changes.
4. A statement of
whether the revision applies only to new business, only to in-force business,
or to both.
5. The expected average
annual premium per policy and per member, before and after the proposed rate
revision. Where different changes by rating classification are being requested,
the rate filing shall also include (i) the range of changes and (ii) the
average overall change with a detailed explanation of how the change was
determined.
6. Historical and
projected experience, including:
a. Virginia
and, if applicable, national or manual historical experience as specified in
14VAC5-130-50
C and projections for future experience;
b. A statement indicating the basis for
determining the rate revision (Virginia, national or manual, or
blended);
c. If the basis is
blended, the credibility factor assigned to the Virginia experience;
d. Earned Premiums (EP), Incurred Benefits
(IB), Increase in Reserves (IR), and Incurred Loss Ratio = (IB + IR) ÷
(EP); and
e. Any other available
data the insurer may wish to provide. The additional data may include, if
available and appropriate, the ratios of actual claims to the claims expected
according to the assumptions underlying the existing rates; substitution of
actual claim run-offs for claim reserves and liabilities; accumulations of
experience funds; substitution of net level policy reserves for preliminary
term policy reserves; adjustments of premiums to an annual mode basis; or other
adjustments or schedules suited to the form and to the records of the company.
All additional data must be reconciled, as appropriate, to the required
data.
7. Details and
dates of all past rate revisions, including the annual rate revisions members
will experience as a result of this filing. For insurers revising rates only
annually, the rate revision should be identical to the current submission. For
insurers that have had more frequent rate revisions, the annual revision should
reflect the compounding impact of all such revisions for the previous 12
months.
8. A description of how
revised rates were determined, including the general description and source of
each assumption . For claims, provide historical and projected claims by major
service category for both cost and utilization .
9. If the rate revision applies to new
business, provide the anticipated loss ratio and a description of how it was
calculated.
10. If the rate
revision applies to in-force business:
a. The
anticipated loss ratio and a description of how it was calculated;
and
b. The estimated cumulative
loss ratio, historical and anticipated, and a description of how it was
calculated.
11. The loss
ratio that was originally anticipated for the policy.
12. If 9, 10a, or 10b is less than 11,
supporting documentation for the use of such premiums or rates.
13. The current number of Virginia, and
national if applicable, members to which the revision applies for the most
recent month for which such data is available, and either premiums in force,
premiums earned, or premiums collected for such members in the year immediately
prior to the filing of the rate revision.
14. Certification by a qualified actuary
that, to the best of the actuary's knowledge and judgment, the rate filing is
in compliance with applicable laws and regulations of this Commonwealth and the
premiums are reasonable in relation to the benefits provided.
15. For individual or small employer group
health insurance coverage, a certification by a qualified actuary to include
(i) the methodology used to calculate the AV metal value for each plan; (ii)
the appropriateness of the essential health benefit portion of premium upon
which advanced payment of premium tax credits are based; (iii) the development
of the index rate in accordance with federal regulations and the development of
plan specific premium rates using allowable modifiers to the index rate; and
(iv) the geographic rating factors, which should reflect differences only in
the costs of delivery (which can include unit cost and provider practice
pattern differences) and not differences in population morbidity by geographic
area.
16. For student health
insurance coverage, a certification by a qualified actuary to include the
methodology used to calculate an AV level of coverage that meets a minimum
60%.
Statutory Authority: §§ 12.1-13 and 38.2-223 of the Code of Virginia.
Disclaimer: These regulations may not be the most recent version. Virginia may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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