69O-149.002. Scope and Applicability

(1)(a)1. Every policy, rider or endorsement form affecting benefits which is submitted for approval shall be submitted in accordance with the provisions of Part II of this rule chapter and shall be accompanied by a rate filing or an actuarial certification that such policy, rider, or endorsement form does not require a change in rates.

2. Any subsequent addition to or change in rates applicable to such policy, rider, or endorsement form shall also be filed.

(b) Unless the context specifically states otherwise, this Part I of this rule chapter applies to:

1. All individual health insurance issued to Florida residents;

2. All group health insurance insuring the residents of Florida where the master contract is issued in the state of Florida;

3. All franchise health insurance issued to Florida residents; and

4. All Group Health Insurance and Health Maintenance Organization contracts insuring the residents of Florida where the master contract is issued to an association group or a group trust, in or outside the State of Florida, and the insurance is provided to the employees of a small employer as defined in Section 627.6699, F.S.

(c)1. Insurers may make filings that incorporate prospective premium schedule rate changes in which the future change period is up to one year. Examples include increasing the new issue premium by a predetermined amount each month or each quarter, or implementing a rate increase in segments over a one-year period.

2. The renewal premium schedule shall be consistent with any adjustments in the new premium schedule in a predefined and approved fashion.

3. All prospective rate changes or methodologies for rate changes must be approved before implementation in accordance with this part.

(2) As required by Section 627.410(7), F.S., all health insurers shall comply with the annual rate filing requirements in Rule 69O-149.007, F.A.C., including for forms subject to subsection (5) below.

(3) Part I of Rule Chapter 69O-149, F.A.C., does not apply to:

(a) Credit disability insurance as defined in Section 627.677, F.S.;

(b) Contract forms as defined in Section 627.601(3), F.S.

(4) The rates for every individual accident and health policy form filed pursuant to a loss ratio guarantee permitted by Section 627.410(8), F.S., shall comply with the provisions of Rules 69O-149.002 through 69O-149.006 and 69O-149.008, F.A.C. The provisions of Section 627.410(8), F.S., are optional.

(5) The rules of this Part I are applicable to all policies and certificates in force or issued on or after February 1, 1994, except that:

(a) As to forms approved prior to February 1, 1994, and as to which the insurer does not continue to issue new policies after June 1, 1994, only those rules in effect on October 1, 1993 shall apply; and

(b) As to forms approved prior to February 1, 1994, and as to which the insurer continues to issue new policies after June 1, 1994, policies in force on May 31, 1994, shall be subject only to rules in effect on October 1, 1993, and policies issued on or after June 1, 1994, shall be subject to these rules. The rating prohibitions described in paragraphs 69O-149.005(10)(a) and (b), F.A.C., are applicable to all policies and certificates issued on or after October 1, 1993.

(6) Pursuant to the provisions of Section 627.410(6)(b), F.S., rate filings required by Rule 69O-149.003, F.A.C., and Annual Rate Certification (ARC) filings required by Rule 69O-149.007, F.A.C., are not required to be made for the following; however, the rating standards contained in this Part I and applicable statutes shall continue to apply as if the rate schedules were required to be filed for approval:

(a) Annually rated group health insurance policies as defined by Section 627.652(1), F.S., including blanket insurance as defined by Section 627.659, F.S., issued in this state that provide availability of coverage only to groups with 51 or more employees/members.

(b) This filing exemption does not apply to franchise policies issued pursuant to Section 627.663, F.S.

(c) This filing exemption does not apply to stop-loss policy forms, unless the policy is issued only to employers with 51 or more employees.

(7)(a) Forms that provide for the acceleration of the benefits of a life insurance policy that are incidental to the total life insurance coverage are not subject to the annual rate or ARC filing requirements of Section 627.410, F.S., or these rules. The insurer is required to submit an actuarial demonstration with the initial filing for approval demonstrating such incidental compliance.

(b) The acceleration is considered incidental if the value of the accelerated benefit is less than 10 percent of the total value of the benefits provided by the life insurance coverage. These values shall be measured as the present values of the benefits determined as of the date of issue, determined according to the formula (NSP2-NSP1)/NSP1, applied over a range of underwriting classes and plans at which the benefit is being made available, is not in any case greater than 10%, where:

1. NSP1 and NSP2 are determined using an effective annual interest rate of 6%.

2. NSP1 is the net single premium for the base policy benefits assuming there is no accelerated death benefit.

3. NSP2 is the net single premium for the base policy benefits assuming that the full death benefit is paid at time of death or the occurrence of the non-death accelerated death benefit trigger.

(c) If a separate premium or cost of insurance (COI) charge is the only charge being charged for the accelerated benefit provided, the ratio of the present value of the accelerated benefit premiums or COI charges over the life of the policy to the present value of the policy premiums or COI charges exclusive of any riders, does not exceed 10%, the present values shall be determined using an effective annual interest rate of 6%.

(d) Upon request of the Office, the insurer shall provide an actuarial demonstration that the accelerated death benefit continues to meet these standards. If it is determined that the accelerated death benefit fails to comply with these standards, the provisions of these rules shall apply.

Specific Authority 624.308(1), 627.410(6)(b) FS. Law Implemented 624.307(1), 627.402, 627.410(1), (2), (6), (7), 627.411(1)(e), (2), 627.6515(2)(a), 627.6699 FS. History–New 7-1-85, Formerly 4-58.02, 4-58.002, Amended 4-18-94, 4-9-95, 10-27-02, Formerly 4-149.002, Amended 5-18-04, 1-16-08.