§ 2328 — For hire motor vehicle insurance rates; flexible rating; prior approval

§ 2328. For hire motor vehicle insurance rates; flexible rating; prior\napproval. (a) An insurer shall submit to the superintendent, for the\nsuperintendent's prior approval, its rates, rating plans, rating rules,\nand rate manuals applicable to motor vehicle insurance, including\nno-fault coverages under article fifty-one of this chapter, by August\nfirst, two thousand twenty-five and at least every two years thereafter,\nunless the superintendent requests the rates, rating plans, rating\nrules, or rating manuals more frequently. For rates submitted on or\nbefore August first, two thousand twenty-five, the superintendent may\napprove the phasing in of rates that meet the standards set forth in\nsection two thousand three hundred three of this article if the\nsuperintendent determines that it would be in the best interests of the\npeople of this state.\n (b) Except as provided in subsection (c) of this section, no changes\nin rates, rating plans, rating rules and rate manuals applicable to\nmotor vehicle insurance, including no-fault coverages under article\nfifty-one of this chapter, shall be made effective until approved by the\nsuperintendent, notwithstanding any inconsistent provisions of this\narticle.\n (c) Starting December first, two thousand twenty-five, overall average\n(for all coverages combined) rate level increases above an insurer's\nrates in effect that are up to a percentage specified in a regulation\npromulgated by the superintendent but not to exceed five percent during\nany twelve-month period, may take effect without the superintendent's\nprior approval after submitting an informational filing pursuant to\nsection two thousand three hundred ten of this article. An insurer shall\nnot implement more than two rate increases pursuant to this section, the\ntotal of which shall not exceed the limitation specified in a\nregulation, during any twelve-month period. An insurer also shall not\nimplement a rate increase within the limitation specified in a\nregulation until the onset of the new policy period and unless the\ninsurer, at least thirty but not more than sixty days in advance of the\nend of the policy period, mails or delivers to the named insured, at the\naddress shown in the policy, a written notice of its intention to change\nthe rate. The specific reason or reasons for the rate change shall be\nstated in or shall accompany the notice. An insurer shall not implement\na rate change under this subsection when the insurer: (1) has submitted\na rate filing under subsection (a) of this section and the\nsuperintendent has not yet approved it; or (2) is in the process of\nphasing in its rates pursuant to the superintendent's approval under\nsubsection (a) of this section.\n (d) The superintendent shall monitor the degree and continued\nexistence of competition and the effectiveness of flexible rating in\nthis state on an on-going basis. In doing so, the superintendent shall\nutilize the following standards or factors:\n (1) the standards contained in section two thousand three hundred\neight of this article;\n (2) existing relevant information, analytical systems and other\nsources, or rely on some combination thereof;\n (3) the number of insurers or group of affiliated insurers actively\nengaged in providing coverage, taking into account the specialization\ntraditionally required for insurance in the particular rating territory;\n (4) measures of market concentration and changes of market\nconcentration over time, which may include the use of\nHerfindahl-Hirschman Index (HHI) and the United States Department of\nJustice merge guidelines for an unconcentrated market ease of entry, and\nthe existence of financial or economical barriers that could prevent new\nfirms from entering the market;\n (5) the extent to which any insurer or group of affiliated insurers\ncontrols all or a dominant portion of the market has actively sought to\nprevent competition;\n (6) whether the total number of companies writing the line of\ninsurance in this state is sufficient to provide multiple options;\n (7) the availability of insurance coverage to consumers;\n (8) the opportunities available to consumers in the market to acquire\npricing and other consumer information; and\n (9) any other factors relevant to inquiry.\n Such activities may be conducted internally within the department, in\ncooperation with other state insurance departments, through outside\ncontractors and/or in any other appropriate manner, provided that the\ndepartment shall report to the speaker of the assembly, temporary\npresident of the senate, and governor on the effectiveness of flexible\nrating on the for hire motor vehicle market by December first, two\nthousand twenty-seven and every two years thereafter.\n (e) This section shall apply only to policies covering losses or\nliabilities arising out of ownership of a motor vehicle used principally\nfor the transportation of persons for hire, including a bus or a school\nbus as defined in sections one hundred four and one hundred forty-two of\nthe vehicle and traffic law, provided, however, that subsections (a) and\n(c) of this section shall not apply to a bus or a school bus as defined\nin sections one hundred four and one hundred forty-two of the vehicle\nand traffic law.\n