Section 2220.58 - Annual Premium Rates and Loss Ratio Experience Filing Requirements for Medicare Supplement Insurance(a) This regulation applies to all insurers who offer Medicare Supplement Insurance, including pre-standardized Medicare Supplement Insurance plans, standardized Medicare Supplement Insurance plans, and Medicare SELECT plans, whether to individuals or groups.(b) Annual premium rates and loss ratio experience filings must be made regardless of Medicare changes, an insurer's prior year loss ratio experience, future marketing plans, or whether new premium rates are being requested.(c) Insurers offering Medicare Supplement Insurance must include the following in their annual filings with the Commissioner of Insurance:(1)Premium Rate Schedules. Submit premium rate schedules for each individual policy or group certificate. Indicate all special rating factors used for California, such as a zip code rating factor. Indicate whether a premium rate change is requested and, if so, the percentage change.(2)Policy Forms. Submit specimens of each individual Medicare Supplement Insurance individual policy or group certificate and outlines of coverage for each plan, if revised, new, or not included in a filing for a previous year.(3)Loss Ratio Experience Exhibits. Provide complete loss ratio information for each Medicare Supplement Insurance plan since the inception of that plan. For rate filings made in anticipation of Medicare benefit changes, include at least nine months' of loss ratio experience (unless the plan has not been marketed for at least nine months, in which case, submit loss ratio experience information for the period the plan was marketed). First quarter filings must include the entire previous year's loss ratio experience. Such information for plans covering fewer than 100 California residents may be combined if the coverages are similar. Re-state the loss ratio information for the previous year, adjusted for run-off accruals to date. Include the number of California residents covered by the plan.(4)Projected Loss Ratio Experience. Provide projected loss ratio experience for at least five years into the future, reflecting that projected experience both with and without any requested premium rate increase.(5)NAIC Medicare Supplement Experience Exhibit. Provide a National Association of Insurance Commissioners (NAIC) Experience Exhibit for each individual policy form or group certificate which covers 100 or more California residents.(6)Actuarial Memorandum. Submit an actuarial memorandum for each Medicare Supplement Insurance plan in accordance with subsection (d).(d) Medicare Supplement Insurers must provide an actuarial analysis for each individual plan or group certificate that covers 100 or more California residents in an actuarial memorandum. More than one analysis can be combined in one memorandum. Once actuarial analysis may be provided for all individual plans or groups with certificates covering fewer than 100 California residents. Each insurer must use its own data; however, actuarial studies from other sources may be submitted to provide additional information regarding plan renewal assumptions. Each actuarial analysis and memorandum must include:
(1) Historical and projected premium income, claims, and loss ratio experience for each plan.(2) A description of coverage, including coverage renewability, whether marketing of the plan is continuing, the date marketing began, and the date marketing stopped, if it has stopped.(3) For rate increase requests, the average current premium rate and the average premium rate for the proposed new premium rates for California residents, compared to the insurer's average premium rates for current and proposed new premium rates nationally.(4) Active life reserves at the end of the prior calendar year.(5) Monthly claim triangulation lag reports for California residents and nationally for the most recent 24 months for each plan or group policy covering 300 or more California residents. Circle or highlight the relevant data showing how the lag reports are used in developing incurred but not reported (IBNR) claims and claim reserves.(6) A description of the experience and any premium rating request, including trend for benefits not covered by Medicare (e.g., prescription drugs).(7) National data and rating development presented in the same format as provided for California insureds.(8) Cost trend assumptions.(9) Administrative costs, including, but not limited to, commissions, claims processing, customer services, and taxes.(10) A certification that the loss ratios comply with statutory requirements for loss ratios; and, if a premium rate increase is requested, that the loss ratios will continue to comply with such statutory requirements if a premium rate increase is approved.(11) A certification that the filed rates are reasonable in relation to benefits provided for each individual policy form or group certificate.(e) Completion and submission to the Commissioner of the documents and information required in subsection (b), (c), and (d) above, together with evidence that statutorily required minimum loss ratios are met constitutes the minimum standards necessary for approval of a Medicare Supplement Insurance premium rate filing.Cal. Code Regs. Tit. 10, § 2220.58
1. New section filed 12-11-2000; operative 1-10-2001 (Register 2000, No. 50). Note: Authority cited: Section 10195.1(d), Insurance Code. Reference: Section 10195.1, Insurance Code.
1. New section filed 12-11-2000; operative 1-10-2001 (Register 2000, No. 50).