Naic: Model Rating Laws National Association Of Insurance Commissioners
State laws based on a model law of the National Association of Insurance Commissioners (NAIC) that allow insurers to set rates independently; or adopt those rates developed by a rating bureau that must first be approved by the appropriate state regulator. Because state regulators believe that rate wars can be disastrous to the financial health of insurers, insurance companies are allowed to band together to set standard rates through rate making bureaus. Model rating laws also allow independent insurers to set their own rates, but prohibit the return of part of a premium to the insured other than as a dividend. Legislation developed from this model bill is called a prior approval law because the appropriate insurance commissioner must approve the rates involved. Other major types of rating laws are FILE-AND-USE RATING LAWS and OPEN COMPETITION LAWS.
Popular Insurance Terms
Wrong against the government or society as a whole. An individual representing the state (usually the district attorney) brings an action on behalf of the state against an individual (s) or ...
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Voluntary state insurance programs that aid small businesses in acquiring insurance coverages when there are impediments to obtaining the coverage. ...
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Arrangement whereby the insured pays the insurance company a relatively small monthly premium payment. In exchange for this premium payment, the insurance company processes and pays claims ...
Evaluation of the demographic characteristics of the entire group (such as age, sex, morbidity, mortality), as opposed to the evaluation of individuals in that group. ...
Total value of all goods and services produced by companies located in the United States as well as that produced by United States companies whose production facilities are outside the ...
Use of a life insurance policy dividend by the owner of a participating policy. Here the policy dividend is left with the insurance company to accumulate at a guaranteed minimum interest ...
Specialist whose task is to place insurance with the specialized syndicates that underwrite particular risks at Lloyd's of London. ...
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