N.J. Admin. Code § Tit. 11, ch. 3, subch. 16, APPENDIX, exh. E
Calculation of Maximum on Combined Commission and Brokerage, Other Acquisition Expense and General Expenses
The maximum allowed expense provision for commission and brokerage, other acquisition, and general expenses shall be calculated as a weighted average, plus five percent of the provision for all private passenger automobile companies or groups in this State that use the same marketing method as the filer, excluding the results of insurance carriers with membership requirements. The Department may, in its discretion, also exclude the expenses of carriers that are newly admitted and writing business in the State due to the potential distortion in the expenses of such carriers, including the effect of start-up costs.
The Department will compile the list of private passenger automobile companies or groups on May 31 of each year based on the most recent annual premium volume.
The companies and groups on the list shall be divided into one of the three marketing methods: (1) Independent Agents; (2) Captive Agents; or (3) Direct Writers. The designation of marketing method shall be based on the primary designation for the company or group in the A.M. Best Report (Property/Casualty). The list shall be posted on the Department's web site and made available to filers on request.
The provision for commission and brokerage expense shall be calculated by the Department as a percentage of New Jersey written premium, as stated on New Jersey Page 14 of the Statutory Annual Statement for each company or group used in the calculation. The provision for general and other acquisition expense shall be calculated by the Department as a percentage of countrywide earned premium, as stated on Part 3 of the Insurance Expense Exhibit for each company or group used in the calculation. The maximum allowed expense provision, calculated by group of coverages (liability, risks, physical damage), shall be the weighted average of the total commission and brokerage, other acquisition, and general expense provisions for each company within each marketing method, plus an additional five percent.
N.J. Admin. Code Tit. 11, ch. 3, subch. 16, APPENDIX, exh. E
See: 29 N.J.R. 5240(a), 30 N.J.R. 828(a).
Was "Marketing Methods for the Top 20 Private Passenger Auto Insurers in New Jersey".
Repeal and New Rule, R.2001 d.44, effective 2/5/2001. See: 32 N.J.R. 3891(a), 33 N.J.R. 573(a).
Section was "Marketing Methods for the Largest Private Passenger Auto Insurer Groups in New Jersey".
Amended by R.2003 d.173, effective 5/5/2003. See: 34 N.J.R. 3475(a), 35 N.J.R. 1907(a).
Inserted a fourth paragraph. Amended by R.2003 d.499, effective 12/15/2003.
See: 35 N.J.R. 3084(a), 35 N.J.R. 5604(a).
Inserted "excluding the results of insurance carriers with membership requirements" in the first paragraph; substituted "May 31"
for "June 30" in the second paragraph.
Recodified from N.J.A.C. 11:3-16 Appendix Exhibit H by R.2005 d.176, effective 6/6/2005.
See: 36 N.J.R. 5640(a), 37 N.J.R. 2026(a).
Amended by R.2006 d.138, effective 4/17/2006.
See: 37 N.J.R. 3542(a), 38 N.J.R. 1742(b).
Rewrote Exhibit E.