§ 24-A §2382 — Rate standards

Maine § 24-A §2382

• Jurisdiction: Maine
• Title 24-A: MAINE INSURANCE CODE
• Ch. 25: RATES AND RATING ORGANIZATIONS

Text

The following standards apply to the making and the use of rates under this Act.
1.
Rates.
Rates may not be excessive, inadequate, or unfairly discriminatory.
2.
Excessive rates.
Voluntary and residual market rates are subject to the following.
3.
Inadequate rates.
A rate is not inadequate unless insufficient to sustain projected losses and expenses and the use of the rate has had a tendency to create a monopoly or, if continued, will tend to create a monopoly in the market or will cause serious financial harm to the insurer.
4.
Unfair discrimination.
Unfair discrimination exists if, after allowing for practical limitations, price differentials fail to reflect equitably the differences in expected losses and expenses. A rate is not unfairly discriminatory because different premiums result for policyholders with like loss exposures but different expenses, or like expenses but different loss exposures, so long as the rate reflects the differences with reasonable accuracy.
5.
Determination of compliance.
Determination of compliance with standards for rate factors, expenses and profits is as follows.

Legislative History

PL 1991, c. 885, §B12 (NEW). PL 1991, c. 885, §B13 (AFF).