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PA Issues Notice Regarding the Need to Assess the Impacts of COVID-19 Pandemic in Property and Casualty Rate Filing

On April 24, 2021, the Pennsylvania Insurance Department issued Bulletin No. 51 Pa.B. 2363 reminding insurers that they need to continue to account for the impacts of the COVID-19 pandemic in their rate filings.

Insurers must assess the impact of the pandemic on their property and casualty products and explain how it is accounted for in the filing.   The filings should also include five years’ of claim frequency statistics by month on a state and countrywide basis.  If there is an offsetting impact to severity, then the severity information should also be provided.  If insurers believe they have not been impacted by the pandemic, then they must include a section in the rate filing supporting their assessment.

The Department will continue to monitor the situation and will announce when this information is no longer required to be included in the rate filings.

For any questions regarding the Bulletin No. 51 Pa.B. 2363 , or any other rate filing concerns, please contact Westmont Associates, Inc.

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Montana to Allow Use of Gender and Marital Status in Underwriting

On April 19, 2021, Montana Governor Greg Gianforte signed House Bill 379, permitting the use of gender and martial status as part of the insurance underwriting process. Prior to HB 379’s passing, Montana was an outlier in it’s complete prohibition of such practices across all lines of insurance. The Act applies to all policies issued on or after January 1, 2022.
In a survey conducted by the National Association of Insurance Financial Advisors across 19 states, the study found that women aged 55 buying a $500,000, 20-year term life policy in Montana were paying, on average, 31% more than women in other states. Backed by Insurance Commissioner Troy Downing, HB 379 advances Montana’s efforts to lower costs for insureds, particularly focused on life and automobile premiums for women.
For any questions regarding the HB 379, or any other underwriting concerns, please contact Westmont Associates, Inc.
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WA OIC issues Emergency Rule banning credit scoring

On March 22nd, the Washington Office of Insurance Commissioner (“OIC”) issued an Emergency Rule banning credit scoring on all personal insurance policies related to private passenger automobile coverage, renter’s coverage, and homeowner’s coverage issued in the state of Washington.
All applicable insurers shall not use credit history to determine personal insurance rates, premiums, or eligibility for coverage. Insures subject to this rule may substitute any insurance credit score factor used in a rate filing with a “neutral” rating factor. According to the WA OIC, a “neutral factor” means a single constant factor calculated such that, when applied to all policies in an insurer’s book of business, total premium for an insurer’s book of business will remain unchanged.
The Emergency Rule takes effect immediately and shall remain in effect for three years (until March 2022) following the day the national emergency was declared on March 13, 2020.
For additional details regarding this matter, the Emergency Rule can be found HERE.
For any other information regarding this Rule, or questions regarding our Personal Lines compliance services, please do not hesitate to contact us.
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