Md. Code Regs. 31.10.06.19

Current through Register Vol. 51, No. 24, December 2, 2024

Section 31.10.06.19 - Report Form for Calculation of Loss Ratios

The following forms are to be used for reporting loss ratios and calculating refunds for credits required under Regulation .11B of this chapter:

A. Medicare Supplement Refund Calculation Form.

MEDICARE SUPPLEMENT REFUND CALCULATION FORM FOR CALENDAR YEAR _____

TYPE¹___________________________________	SMSBP²_______________________________________
For the State of____________________________	Company Name ________________________________
NAIC Group Code _________________________	NAIC Company Code ___________________________
Address ________________________________	Person Completing This Exhibit ____________________
Title ___________________________________	Telephone Number _____________________________

line		(a) Earned Premium³	(b) Incurred Claims⁴
1	Current Year's Experience
	a. Total (all policy years)
	b. Current year's issues⁵
	c. Net (for reporting purposes = 1a - 1b)	____________	____________
2	Past Years' Experience
	(All Policy Years)	____________	____________
3	Total Experience (Net Current Year + Past Years' Experience)	____________	____________
4	Refunds last year (Excluding Interest)
5	Previous Since Inception (Excluding Interest)
6	Refunds Since Inception (Excluding Interest)
7	Benchmark Ratio Since Inception (SEE WORKSHEET FOR RATIO 1)
8	Experienced Ratio Since Inception (Ratio 2)
	Total Actual Incurred Claims (line 3, col b) Tot. Earned Prem. (line 3, col a) - Refunds Since Inception (line 6)	____________
9	Life years Exposed Since Inception	____________
	If the Experienced Ratio is less than the Benchmark Ratio, and there are more than 500 life years exposure, then proceed to calculation of refund.
10	Tolerance Permitted (obtained from credibility table)	____________

MEDICARE SUPPLEMENT REFUND CALCULATION FORM FOR CALENDAR YEAR _____

TYPE¹___________________________________	SMSBP²_______________________________________
For the State of____________________________	Company Name ________________________________
NAIC Group Code _________________________	NAIC Company Code ___________________________
Address ________________________________	Person Completing This Exhibit ____________________
Title ___________________________________	Telephone Number _____________________________

line
11	Adjustments to Incurred Claims for Credibility
	Ratio 3 = Ratio 2 + Tolerance		____________
	If Ratio 3 is more than benchmark ratio (ratio 1), a refund or credit to premium is not required.
	If Ratio 3 is less than the benchmark ratio, then proceed.
12	Adjusted Incurred Claims
	{Tot. Earned Premiums (line 3, col. a) - Refunds Since Inception (line 6)} x Ratio 3 (line 11)		____________
13	Refund = Total Earned Premiums (line 3, col a) - Refunds Since Inception (line 6) - {Adjusted Incurred Claims (line 12)/ Benchmark Ratio (Ratio 1) }		____________
	If the amount on line 13 is less than .005 times the annualized premium in force as of December 31 of the reporting year, then no refund is made. Otherwise, the amount on line 13 is to be refunded or credited, and a description of the refund or credit against premiums to be used must be attached to this form.
	Medicare Supplement Credibility Table
	Life Years Exposed Since Inception	Tolerance
	10,000 +	0.0%
	5,000-9,999	5.0%
	2,500-4,999	7.5%
	1,000-2,499	10.0%
	500-999	15.0%
	If less than 500, no credibility.

MEDICARE SUPPLEMENT REFUND CALCULATION FORM FOR CALENDAR YEAR _____

TYPE¹___________________________________	SMSBP²_______________________________________
For the State of____________________________	Company Name ________________________________
NAIC Group Code _________________________	NAIC Company Code ___________________________
Address ________________________________	Person Completing This Exhibit ____________________
Title ___________________________________	Telephone Number _____________________________

¹ Individual, Group, Individual Medicare Select, or Group Medicare Select Only

² "SMSBP" = Standardized Medicare Supplement Benefit Plan-Use "P" for prestandarized plans

³ Includes modal loadings and fees charged.

⁴ Excludes Active Life Reserves

⁵ This is to be used as "Issue Year Earned Premium" for Year 1 of next year's "Worksheet for Calculation of Benchmark Ratios"

I certify that the above information and calculations are true and accurate to the best of my knowledge and belief.

________________________________ Signature

________________________________ Name"Please Type

________________________________ Title"Please Type

________________________________ Date

B. Reporting Form for Benchmark Ratio for Group Policies.

REPORTING FORM FOR THE CALCULATION OF BENCHMARK RATIO SINCE INCEPTION FOR GROUP POLICIES FOR CALENDAR YEAR ________

TYPE¹___________________________________	SMSBP²_______________________________________
For the State of____________________________	Company Name ________________________________
NAIC Group Code _________________________	NAIC Company Code ___________________________
Address ________________________________	Person Completing This Exhibit ____________________
Title ___________________________________	Telephone Number _____________________________

(a)³	(b)⁴	(c)	(d)	(e)	(f)	(g)	(h)	(i)	(j)	(o)⁵
Year	Earned Premium	Factor	(b) x (c)	Cumulative Loss Ratio	(d) x (e)	Factor	(b) x (g)	Cumulative Loss Ratio	(h) x (i)	Policy Year Loss Ratio
1		2.770		0.507		0.000		0.000		0.46
2		4.175		0.567		0.000		0.000		0.63
3		4.175		0.567		1.194		0.759		0.75
4		4.175		0.567		2.245		0.771		0.77
5		4.175		0.567		3.170		0.782		0.8
6		4.175		0.567		3.998		0.792		0.82
7		4.175		0.567		4.754		0.802		0.84
8		4.175		0.567		5.445		0.811		0.87
9		4.175		0.567		6.075		0.818		0.88
10		4.175		0.567		6.650		0.824		0.88
11		4.175		0.567		7.176		0.828		0.88
12		4.175		0.567		7.655		0.831		0.88
13		4.175		0.567		8.093		0.834		0.89
14		4.175		0.567		8.493		0.837		0.89
15+⁶		4.175		0.567		8.684		0.838		0.89
			________		________		________		________
Total:		(k):		(l):		(m):		(n):

Benchmark Ratio Since Inception: (l + n)/(k + m):

¹Individual, Group, Individual Medicare Select, or Group Medicare Select Only.

²"SMSBP" = Standardized Medicare Supplement Benefit Plan-Use "P" for pre-standardized plans

³Year 1 is the current year -

1. Year 2 is the current calendar year - 2 (etc.) (Example: If the current year is 1991, then Year 1 is 1990; Year 2 is 1989, etc.)

⁴For the calendar year on the appropriate line in column (a), the premium earned during that year for policies issued in that year.

⁵These loss ratios are not explicitly used in computing the benchmark loss ratios. They are the loss ratios, on a policy year basis, which result in the cumulative loss ratios displayed on this worksheet. They are shown here for informational purposes only.

⁶To include the earned premium for all years prior to as well as the 15th year prior to the current year.

C. Reporting Form for Benchmark Ratio for Individual Policies.

REPORTING FORM FOR THE CALCULATION OF BENCHMARK RATIO SINCE INCEPTION FOR GROUP POLICIES FOR CALENDAR YEAR ________

TYPE¹___________________________________	SMSBP²_______________________________________
For the State of____________________________	Company Name ________________________________
NAIC Group Code _________________________	NAIC Company Code ___________________________
Address ________________________________	Person Completing This Exhibit ____________________
Title ___________________________________	Telephone Number _____________________________

(a)³	(b)⁴	(c)	(d)	(e)	(f)	(g)	(h)	(i)	(j)	(o)⁵
Year	Earned Premium	Factor	(b) x (c)	Cumulative Loss Ratio	(d) x (e)	Factor	(b) x (g)	Cumulative Loss Ratio	(h) x (i)	Policy Year Loss Ratio
1		2.770		0.442		0.000		0.000		0.4
2		4.175		0.493		0.000		0.000		0.55
3		4.175		0.493		1.194		0.659		0.65
4		4.175		0.493		2.245		0.669		0.67
5		4.175		0.493		3.170		0.678		0.69
6		4.175		0.493		3.998		0.686		0.71
7		4.175		0.493		4.754		0.695		0.73
8		4.175		0.493		5.445		0.702		0.75
9		4.175		0.493		6.075		0.708		0.76
10		4.175		0.493		6.650		0.713		0.76
11		4.175		0.493		7.176		0.717		0.76
12		4.175		0.493		7.655		0.720		0.77
13		4.175		0.493		8.093		0.723		0.77
14		4.175		0.493		8.493		0.725		0.77
15+⁶		4.175		0.493		8.684		0.725		0.77
			________		________		________		________
Total:		(k):		(l):		(m):		(n):

Benchmark Ratio Since Inception: (l + n)/(k + m):

¹Individual, Group, Individual Medicare Select, or Group Medicare Select Only.

²"SMSBP" = Standardized Medicare Supplement Benefit Plan-Use "P" for prestandardized plans

³Year 1 is the current year -

1. Year 2 is the current calendar year - 2 (etc.) (Example: If the current year is 1991, then Year 1 is 1990; Year 2 is 1989, etc.)

⁴For the calendar year on the appropriate line in column (a), the premium earned during that year for policies issued in that year.

⁶To include the earned premium for all years prior to as well as the 15th year prior to the current year.

Md. Code Regs. 31.10.06.19

Regulations .19 adopted as an emergency provision effective July 14, 1992 (19:16 Md. R. 1466); adopted permanently effective August 3, 1992 (19:15 Md. R. 1389)