760 IAC 1-75-2 - Feasibility study
Authority: IC 20-42.5-2-1
Affected: IC 20-42.5-2-1
Sec. 2.
(a) A risk
pool shall obtain a feasibility study from a qualified actuary, or other expert
approved by the commissioner, before submitting an application under section 3
of this rule. The feasibility study shall estimate the contributions necessary
to cover losses and expenses for the risk pool. It shall include the expert's
opinion that a risk pool is an appropriate vehicle for the founding
participants of the risk pool. The following factors shall be considered and
addressed in the feasibility study:
(1) Risks
for which the risk pool will provide coverage.
(2) The amounts of initial capital and
expenses the founding participants will commit to the risk pool from their own
resources until the risk pool becomes self-supporting.
(3) The types of services the risk pool will
require and their possible source. Services may include the following:
(A) Actuarial.
(B) Financial.
(C) Legal.
(D) Management.
(4) Goals and future changes anticipated by
the organization.
(b)
The results of the feasibility study shall address the following two (2)
distinct parts:
(1) A risk management analysis
to determine the lines of coverage and types of losses that could best be
financed through the risk pool.
(2)
An operational analysis to project the costs and benefits under different
scenarios that the founding participants could expect from the most reasonable
use of a risk pool. At a minimum, the operational analysis shall include the
following cost/benefit relationships of alternatives as determined from the
following:
(A) Price quotations from
reinsurers or excess insurers.
(B)
Costs to be charged by management companies.
(C) Costs and benefits for other services on
all activities relevant to the operation.
Notes
State regulations are updated quarterly; we currently have two versions available. Below is a comparison between our most recent version and the prior quarterly release. More comparison features will be added as we have more versions to compare.
No prior version found.