Naic: Model Rating Laws National Association Of Insurance Commissioners
Definition of "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
Payments in a defined benefit plan. Benefits are allocated to the pension plan participants as premiums are received by the insurance company. Since the benefits purchased are paid up, the ...
Coverage for the federal government in the event of loss due to dishonest acts of federal government employees. ...
Organization of brokers and securities dealers in the over-the-counter market operating under the auspices of the Securities and Exchange Commission (SEC). Its purpose is to enforce, on a ...
Contract combining whole life and decreasing term insurance. A monthly income is paid to a beneficiary if an insured dies during a specific period. At the end of that period, the full face ...
Minimum of care owed by one party for the physical safety of another. Liability suits are brought because of negligent acts and omissions resulting from failures to exercise due care. ...
Trust that is established by people still alive. ...
Smallest premium necessary to keep the life insurance policy in force regardless of the current mortality, interest, and expense experience of the insurance company. This type of premium is ...
Legal capability of those involved in mutual assent of making a contract, including an insurance contract. Those who have been deemed to be incompetent to make a valid contract include ...
State in which an insurance company has its principal legal residence; where an individual resides in a fixed permanent home. ...
Have a question or comment?
We're here to help.