Virginia Administrative Code › Title 14 - INSURANCE › Agency 5 - STATE CORPORATION COMMISSION, BUREAU OF INSURANCE › Chapter 130 - RULES GOVERNING THE FILING OF RATES FOR INDIVIDUAL AND CERTAIN GROUP ACCIDENT AND SICKNESS INSURANCE POLICY FORMS › Section 14VAC5-130-70 - Filing a rate revision

Current through Register Vol. 40, No. 24, July 15, 2024
A.
				Each rate revision submission shall include (i) a new rate sheet, (ii) an
				actuarial memorandum, and (iii) all information required in SERFF.
B. The actuarial memorandum shall contain the
				following information:
1. A description of
				the type of policy, including benefits, renewability, issue age limits, and if
				applicable, whether the policy includes grandfathered or nongrandfathered plans
				or both.
2. The scope and reason
				for the premium or rate revision.
3. A comparison of the revised premiums with
				the current premiums, including all percentage rate changes and any rating
				factor changes.
4. A statement of
				whether the revision applies only to new business, only to in-force business,
				or to both.
5. The expected average
				annual premium per policy and per member, before and after the proposed rate
				revision. Where different changes by rating classification are being requested,
				the rate filing shall also include (i) the range of changes and (ii) the
				average overall change with a detailed explanation of how the change was
				determined.
6. Historical and
				projected experience, including:
a. Virginia
				and, if applicable, national or manual historical experience as specified in
				14VAC5-130-50
				C and projections for future experience;
b. A statement indicating the basis for
				determining the rate revision (Virginia, national or manual, or
				blended);
c. If the basis is
				blended, the credibility factor assigned to the Virginia experience;
d. Earned Premiums (EP), Incurred Benefits
				(IB), Increase in Reserves (IR), and Incurred Loss Ratio = (IB + IR) ÷
				(EP); and
e. Any other available
				data the insurer may wish to provide. The additional data may include, if
				available and appropriate, the ratios of actual claims to the claims expected
				according to the assumptions underlying the existing rates; substitution of
				actual claim run-offs for claim reserves and liabilities; accumulations of
				experience funds; substitution of net level policy reserves for preliminary
				term policy reserves; adjustments of premiums to an annual mode basis; or other
				adjustments or schedules suited to the form and to the records of the company.
				All additional data must be reconciled, as appropriate, to the required
				data.
7. Details and
				dates of all past rate revisions, including the annual rate revisions members
				will experience as a result of this filing. For insurers revising rates only
				annually, the rate revision should be identical to the current submission. For
				insurers that have had more frequent rate revisions, the annual revision should
				reflect the compounding impact of all such revisions for the previous 12
				months.
8. A description of how
				revised rates were determined, including the general description and source of
				each assumption . For claims, provide historical and projected claims by major
				service category for both cost and utilization .
9. If the rate revision applies to new
				business, provide the anticipated loss ratio and a description of how it was
				calculated.
10. If the rate
				revision applies to in-force business:
a. The
				anticipated loss ratio and a description of how it was calculated;
				and
b. The estimated cumulative
				loss ratio, historical and anticipated, and a description of how it was
				calculated.
11. The loss
				ratio that was originally anticipated for the policy.
12. If 9, 10a, or 10b is less than 11,
				supporting documentation for the use of such premiums or rates.
13. The current number of Virginia, and
				national if applicable, members to which the revision applies for the most
				recent month for which such data is available, and either premiums in force,
				premiums earned, or premiums collected for such members in the year immediately
				prior to the filing of the rate revision.
14. Certification by a qualified actuary
				that, to the best of the actuary's knowledge and judgment, the rate filing is
				in compliance with applicable laws and regulations of this Commonwealth and the
				premiums are reasonable in relation to the benefits provided.
15. For individual or small employer group
				health insurance coverage, a certification by a qualified actuary to include
				(i) the methodology used to calculate the AV metal value for each plan; (ii)
				the appropriateness of the essential health benefit portion of premium upon
				which advanced payment of premium tax credits are based; (iii) the development
				of the index rate in accordance with federal regulations and the development of
				plan specific premium rates using allowable modifiers to the index rate; and
				(iv) the geographic rating factors, which should reflect differences only in
				the costs of delivery (which can include unit cost and provider practice
				pattern differences) and not differences in population morbidity by geographic
				area.
16. For student health
				insurance coverage, a certification by a qualified actuary to include the
				methodology used to calculate an AV level of coverage that meets a minimum
				60%.