§ 2321 — Enforcement and penalties; where prior approval is required

§ 2321. Enforcement and penalties; where prior approval is required.\n(a) Rate service organizations shall be subject to examination by the\nsuperintendent, as often as he may deem it expedient, pursuant to the\nprovisions of this chapter applicable to the examination of insurers.\nRate service organizations which make rates, whether or not advisory,\nshall be examined at least once in every five years.\n (b) (1) If the superintendent finds that any rate filing theretofore\nfiled does not comply with the provisions of this article or that such\nfiling provides rates or rules which are inadequate, excessive, unfairly\ndiscriminatory, destructive of competition, detrimental to the solvency\nof the insurer, or otherwise unreasonable, the superintendent may order\nthe filing withdrawn and the rate suspended prospectively upon fifteen\ndays prior written notice to the rate service organization or to the\ninsurer which filed them, provided, however, such rate service\norganization or insurer may request a hearing, in which case no\nwithdrawal or suspension shall become effective pending the close of the\nhearing, which shall be held within fifteen days of the request. Within\nfifteen days after the close of the hearing, the superintendent shall\ndetermine an adjusted rate based upon the hearing record deemed to be in\ncompliance with the standards set forth in this article, and the rate so\ndetermined shall apply prospectively for a period not to exceed one\nyear.\n (2) At any such hearing, the insurer or rate service organization\nshall have the burden of justifying the rate in question. All such\ndeterminations of the superintendent shall be on the basis of findings\nof fact and conclusions. Nothing in this subsection shall preclude the\nsuperintendent from determining that the last previous rate in effect or\nthe rate filed by the insurer or rate service organization complies with\nthe standards set forth in this article. Nothing in this subsection\nshall preclude the insurer or a rate service organization from making or\nmodifying any rate filing at any time.\n (c) Whenever the superintendent finds, after notice and a hearing,\nthat unfair discrimination exists in the making or in the application of\nrates made or used by any rate service organization or by any authorized\ninsurer, he may order that the rate service organization or the insurer\nremove the discrimination; but the same shall not be removed by\nincreasing the rate on any risk affected by the order unless the rate is\napproved by the superintendent as reasonable. Before making such order,\nthe superintendent shall give notice to the rate service organization,\nif any, which made such rate, and to all insurers and other persons\nwhich he may deem directly affected thereby. Every rate service\norganization receiving any such notice shall promptly notify all its\nmembers or subscribers who would be affected by the order, and notice to\nsuch rate service organization shall be deemed notice to its members or\nsubscribers.\n (d) Proceedings pursuant to subsections (b) and (c) hereof may be\ninstituted upon the initiative of the superintendent or upon written\napplication to the superintendent by any aggrieved person or\norganization, other than a rate service organization, for a hearing, if\nthe superintendent finds that the application is made in good faith and\nthat the grounds otherwise justify holding such a hearing.\n (e) Any person, association, corporation or rate service organization\nwilfully violating the applicable provisions of this article shall, in\naddition to any other penalty provided by law, be liable to the people\nof this state for a penalty in an amount not less than twenty-five\ndollars nor more than one thousand dollars for each offense. If the\nsuperintendent finds after notice and hearing, that any authorized\ninsurer, licensed agent or licensed insurance broker has wilfully\nviolated any of the provisions of this article, he may, in lieu of any\nother penalty provided by law, order the insurer, agent or broker, as\nthe case may be, to pay to the people of this state a penalty in the sum\nof one hundred dollars, for each offense, and the failure of any such\nperson to pay the penalty within thirty days after the making of the\norder, unless the order is suspended by a court of competent\njurisdiction, shall constitute a violation of the provisions of this\nchapter. Within the meaning of this subsection, the issuance,\nprocurement or negotiation of each policy of insurance, by an insurer,\nagent or broker, as the case may be, in willful violation of the\nprovisions of this article shall be deemed a separate offense.\n (f) This section shall be applicable to kinds of insurance or\ninsurance activities the rates for which are subject to prior approval\nand which are subject to this article.\n