Conn. Agencies Regs. § 38a-495-7 - Loss ratio standards
(a) Medicare
supplement policies shall return to policyholders in the form of aggregate
benefits under the policy, for the entire period for which rates are computed
to provide coverage, on the basis of incurred claims experience or incurred
health care expenses where coverage is provided by a health maintenance
organization on a service rather than reimbursement basis and earned premiums
for such period and in accordance with accepted actuarial principles and
practices:
(1) At least 70 percent of the
aggregate amount of premiums earned in the case of group policies;
and
(2) At least 75 percent of the
aggregate amount of premiums earned in the case of group policies defined in
Section 1882 (g) of Title XVIII of the Social Security Act,
42
U.S.C. 1395ss(g), as
amended; and
(3) At least 65
percent of the aggregate amount of premiums earned in the case of individual
policies.
All filings of rates and rating schedules shall demonstrate that actual and expected losses in relation to premiums comply with the requirements of this section.
(b) Every entity providing Medicare
supplement policies in this State shall file annually its rates, rating
schedule and supporting documentation including ratios of incurred losses to
earned premiums and paid losses to written premiums by number of years of
policy duration demonstrating that it is in compliance with the foregoing
applicable loss ratio standards and that the period for which the policy is
rated is reasonable in accordance with accepted actuarial principles and
experience.
(c) As soon as
practicable, but prior to the effective date of Medicare benefit changes every
insurer, health care service plan or other entity providing Medicare supplement
insurance or contracts in this State shall file with the Commissioner, in
accordance with the applicable filing procedures of this state:
(1)
(A)
Appropriate premium adjustments necessary to produce loss ratios as originally
anticipated for the applicable policies or contracts. Such supporting documents
as necessary to justify the adjustment shall accompany the filing,
and
(B) Every insurer, health care
service plan or other entity providing Medicare supplement insurance or
benefits to a resident of this State pursuant to Section
38a-495
of the General Statutes shall make such premium adjustments as are necessary to
produce an expected loss ratio under such policy or contract as will conform
with the minimum loss ratio standards for Medicare supplement policies and
which are expected to result in a loss ratio at least as great as that
originally anticipated in the rates used to produce current premiums by the
insurer, health care service plan or other entity for such Medicare supplement
insurance policies or contracts. No premium adjustment which would modify the
loss ratio experience under the policy other than the adjustments described
herein should be made with respect to a policy at any time other than upon its
renewal date or anniversary date.
(2) Any appropriate riders, endorsements or
policy forms needed to accomplish the Medicare supplement insurance
modifications necessary to eliminate benefit duplications with Medicare. Any
such riders, endorsements or policy forms shall provide a clear description of
the Medicare supplement benefits provided by the policy or contract.
Notes
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