property & casualty product review homeowners/dwelling ... · 1. provide exhibits that include...
TRANSCRIPT
Property & Casualty Product Review
Homeowners/Dwelling Rate Filings and the Public Hearing Process
June 14, 2012
Ken Ritzenthaler, ACAS Robert Lee, FCAS
1. Provide exhibits that include significant amounts of data in an Excel format with the formulas included.
2. Avoid duplication. For example, if you provide data in an Excel file, do not provide the same data in a PDF file.
3. Provide the “Cost of Reinsurance Support” document with responses inserted after each item. Do not refer to other exhibits when responding to item 8; provide the requested probable maximum loss and the related recurrence period.
Ways To Speed Up The Filing Review Process
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4. Include an Excel file with formulas that show how the three reinsurance cost provisions (e.g., Non-FHCF Reinsurance Cost, FHCF Reinsurance Cost, and Cost of Reinsurance to Replace Available TICL Coverage including the TICL Reduction) are calculated. For any figure that uses a reinsurance contract as a source, provide the specific location in the contract for the figure. Provide support for any other figure that is not formula driven.
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5. If you re-rate your book of business to determine the current rate level factors, you should still provide a rate history. You should also provide some type of support in addition to a statement that you re-rated your book of business. Note – include the Office “FCP” numbers for each filing included in your rate history.
6. As a part of your support for the “Annual Premium Trend,” include historical average amount of insurance data, even if you do not use it to determine the “Annual Premium Trend.”
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7. As a part of your support for the “Annual Loss Trend,” include historical loss trend data, even if you do not use it to determine the “Annual Loss Trends.”
8. As a part of your support for the “Premium In-Force At C.R.L.” for “All Policies” and “Policies That Incl. Wind,” include the actual premium in-force amounts, the applicable rate history, and the calculation of the “Premium In-Force At C.R.L.”
9. Provide a “guide” that helps us locate the supporting data for the entries on the rate indication form.
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10. The cost of reinsurance must be split into two components. Even though you can no longer purchase the full $12B of TICL coverage, you should assume that this level of coverage is available when calculating the “Cost of Reinsurance to Replace Available TICL Coverage including the TICL Reduction.” Private reinsurance costs that cover any part of the $12B TICL layer must be included under item (59A) of the rate indication form.
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11. When calculating territory indications
• Use accident year data that includes the same accident years as are included in the rate indication forms.
• Include statewide totals whenever possible. If there is a total that does not match a total on the rate indication form, explain the difference.
12. Include the supporting data and information required in the “Support For Rates By Territory” document and the “Other Rating Factor Changes” document.
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This presents an opportunity for anyone to propose revisions to any of the I-File documents. If you would like to propose revisions, let us know which documents you are referencing, why you feel the revisions are needed, and provide any revised “language” you would like to see included in the documents.
The Office is considering some I-File revisions including a significant reduction in the length of the catastrophe model support document.
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When is a public hearing required?
Per Section 627.0629(6), Florida Statutes a public hearing is required for all residential property rate filings in which the Company requests a rate increase that exceeds 15% on a statewide basis and the filing uses a computer model for rate calculation
Per Section 624.324, Florida Statutes the Office could request a public hearing for any filing
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Why have a public hearing?
To provide the public with information about the rate filings including the reasons for the rate increases.
To enable the Company to provide an additional explanation of the filing and supporting documents to the Office.
A Public hearing is not an adversarial litigation hearing. The decision on approval of the filing will be based on the support provided in the filing and, for the record, the Office will include what was said in the public hearing.
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The Agenda of a Public Hearing I. All testifying witnesses for the Company are sworn in by OIR’s
Legal Division.
II. Opening remarks by the Company are allowed, which can include some explanatory material.
III. Clarifying questions about the filing are asked by the Office, primarily the reviewing actuary, and the Company can respond.
IV. If present, The Office of the Insurance Consumer Advocate can either make a presentation or ask the Company additional questions.
V. After filling out a speaker card, the public can come forward and speak. This may include statements or additional questions for the Company.
All public hearings are taped and later available on the OIR website. Some hearings are broadcast live on the Florida Channel.
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Additional Information
The public hearing is not the place for additional material information to be provided to support the filing. Per statute, the original filing is certified by the Company to be complete and includes all necessary information.
If during the filing process the Office requests additional information of this nature then it can be submitted along with an actuarial certification.
If a Company’s response during a public hearing indicates that some additional information is appropriate, and the Office asks for it during the hearing, it can be provided along with an actuarial certification.
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Public Hearing Comments
The public can email comments to [email protected] for the Office to review both before and after the public hearing. [We ask the public to please include the name of the company in the subject line.]
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