§ 44-7507 — Monitoring competition; determining competitive markets; hearing

(1) The director shall monitor
competition and the availability of insurance in commercial insurance markets.
Such monitoring may include requests for information from insurers regarding
the lines, types, and classes of insurance that the insurer is seeking and
able to write. When requested by an insurer with its response, the director
shall keep such responses confidential except as they may be compiled in summaries.
(2) If the director finds that a commercial insurance coverage is contributing
to problems in the insurance marketplace due to excessive rates or lack of
availability, the director shall submit
electronically a report of this
finding to the Legislature. Such report may be a separate report or a supplement
to the annual report required by section 44-113 .
(3) A competitive market is presumed to exist unless the director, after
notice and hearing in accordance with the Administrative Procedure Act, determines
by order that a degree of competition sufficient to warrant reliance upon
competition as a regulator of rating systems, policy forms, or both does not
exist in the market. In determining whether a sufficient degree of competition
exists, the director may consider:
(a) Relevant tests of workable competition pertaining to market structure,
market performance, and market conduct;
(b) The practical opportunities available to consumers in the market
to acquire pricing and other consumer information and to compare and obtain
insurance from competing insurers;
(c) Whether long-term and short-term profitability provides evidence
of excessive rates;
(d) Whether rating systems filed under section 44-7508 would frequently
require amendment or disapproval if filed under sections 44-7510 and 44-7511 ;
(e) Whether additional competition would appear likely to significantly
lower rates or improve the policy forms offered to insureds;
(f) Whether rates would be lowered or policy forms would be improved
by the imposition of a system of prior approval regulation;
(g) Whether policy forms filed under section 44-7508.02 would frequently
require amendment or disapproval if filed under section 44-7513 ; and
(h) Any other relevant factors.
(4) If a market for a particular type of insurance is found to lack
sufficient competition to warrant reliance upon competition as a regulator
of rating systems or policy forms, the director shall identify factors that
appear to be the cause and the extent to which remediation can be achieved
on a short-term or long-term basis. To the extent that significant remediation
can be achieved consistent with the other goals of the Property and Casualty
Insurance Rate and Form Act, the director shall take such action as may be
within the director's authority to accomplish such remediation or to promote
the accomplishment of such remediation.
(5) If the director finds pursuant to a hearing held in accordance with
subsection (3) of this section that the lack of sufficient competition warrants
the application of sections 44-7510 and 44-7511 to the rates charged for a
type of insurance, an order shall be issued pursuant to this section that
applies sections 44-7510 and 44-7511 to the type of insurance. If the director
finds pursuant to a hearing held in accordance with subsection (3) of this
section that the lack of sufficient competition warrants the application of
section 44-7513 to regulate the forms offered for a type of insurance, an
order shall be issued pursuant to this section that applies section 44-7513
to the type of insurance. An order issued under this subsection shall expire
no later than one year after its original issue unless the director renews
the order after a hearing and a finding of a continued lack of sufficient
competition. Any order that is renewed after its first year shall not exceed
three years after reissue unless the director renews the order after a hearing
and a finding of a continued lack of sufficient competition.
(6) The director shall keep on file in one location all complaints from
the public and insurance industry sources alleging that a competitive market
does not exist. The director shall investigate each complaint to the extent
necessary to determine the truth of the allegations. The director shall keep
a summary of his or her findings and conclusions with the complaint.

Legislative History

Source: Laws 2000, LB 1119, § 7; Laws 2003, LB 216, § 20; Laws 2012, LB782, § 55. Cross References: Administrative Procedure Act, see section 84-920.