Reasonableness of Benefits in Relation to Premiums, Actuarial Memorandum, Annual Rate Certification (ARC) Filing Procedures  

    69O-149.005: Reasonableness of Benefits in Relation to Premiums
    69O-149.006: Actuarial Memorandum
    69O-149.007: Annual Rate Certification (ARC) Filing Procedures
    Notice is hereby given that the following changes have been made to the proposed rule in accordance with subparagraph 120.54(3)(d)1., F.S., published in Vol.32,No.17, April 28, 2006 issue of the Florida Administrative Weekly.

    These changes are being made to address concerns expressed at the public hearing.

    Rule 69O-149.005, subsections (12) and (13)(a) have been changed to read as follows:

    (12) Upon request of the Office, the company shall provide an actuarial demonstration that benefit and premium relativities provided on a form currently available for sale are reasonable in relation to benefit and premium relativities provided in other forms currently available for sale in the same rating pool, given actuarial considerations generally used in pricing a product.

    (13)(a) Whenever a company makes a non-contractual offering to existing insureds, without underwriting, to replace or exchange their policy with alternate coverage where the original policy is priced on an issue age rate schedule, the rate charged to the insured for the new policy shall recognize the policy reserve buildup, due to the prefunding inherent in the use of an issue at rate basis, to the benefit of the insured. The method proposed by the company must be filed for approval. The rate for the conversion shall be at the most similar rating class as was the original coverage. A statutorily required conversion provision would be considered contractual.

    The remainder of the rule reads as previously published.

    Rule 69O-149.006 remains as previously published.

    Rule 69O-149.007, subsection (4) is changed to read as follows:

    (4) Non-cancellable coverages which are no longer available for sale and which have not been sold or marketed for at least 5 years and are in compliance with the reasonableness standards of Rule 69O-149.005, F.A.C., shall be exempt from the filing requirements of this rule. If a company is subsequently discovered not to have met the standards, they shall, in addition to other administrative remedies, be required to enhance benefits and make premium refunds to bring the form into full compliance with the loss ratio standards of Rule 69O-149.005, F.A.C.

    Rule 69O-149.007(4), subsections (a) and (b) are deleted.

    The remainder of the reads as previously published.