Florida Regulations 69O-189.015

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§ 69O-189.015 Workers' Compensation Insurer Reporting of Significant Underwriting Change.

(1) Purpose: To administer the requirements of Section 624.4315, F.S.

(2) Definitions:

(a) "Insurer Group" means two or more affiliated insurers that are under common ownership and/or management.

(b) "Underwriting" is defined as the insurer selection of policyholders through hazard recognition and evaluation.

(c) "Underwriting Change" is any deliberately planned change in the insurer's administrative policies or procedures that will affect the insurer's acceptance or rejection of applicants for workers' compensation coverage or will affect the insurer's acceptance or rejection of renewal policies or will result in the mid-term cancellation of policies in Florida. An insurer that transfers policyholders to another insurer in the "Insurer Group", with no lapse in coverage occurring for the policyholder, has not made an "Underwriting Change" for purposes of this rule.

(d) "Significant Underwriting Change that materially limits or restricts the number of workers' compensation policies or premiums written in Florida" means an Underwriting Change that is reasonably expected to result in any of the following:

1. For an "Insurer Group" with more than one insurer licensed in Florida for workers' compensation:

a. Will reduce the number of in-force policies in Florida for the "Insurer Group" by at least 750 policies over the 12 months following the change.

b. Will reduce the number of in-force policies in Florida for the "Insurer Group" by at least 250 and will reduce the number of in-force policies in Florida for the "Insurer Group" at the end of the previous calendar year by more than 33% over the 12 months following the change.

c. Will reduce the direct premiums written in Florida by at least $3 million and the direct written premiums for the "Insurer Group" in Florida for the 12 months following the change will be reduced by more than 33% of the prior calendar year, excluding the impact of rate changes and payroll changes.

d. Will result in the complete elimination of all workers' compensation policies in Florida for any insurer in the group.

2. For an individual insurer with no affiliated insurers licensed in Florida for workers' compensation:

a. Will reduce the number of in-force policies in Florida for the insurer by at least 750 policies over the 12 months following the change.

b. Will reduce the number of in-force policies in Florida for the insurer by at least 250 and will reduce the number of in-force policies in Florida for the insurer at the end of the previous calendar year by more than 33% over the 12 months following the change.

c. Will reduce the direct premiums written in Florida by at least $3 million and the direct written premiums for the insurer in Florida for the 12 months following the change will be reduced by more than 33% of the prior calendar year, excluding the impact of rate changes and payroll changes.

d. Will result in the complete elimination of all workers' compensation policies in Florida for the insurer.

(e) Notwithstanding any other provision herein, a Significant Underwriting Change does not occur in the following situations:

1. A reduction in the number of policies or premium results for reasons other than an "Underwriting Change".

2. The reduction in premium results solely from conversion to a large deductible policy unless there has been an "Underwriting Change" such that the policyholder can only purchase a large deductible.

3. The reduction in premium results solely from conversion to a policy written under a retrospective rating plan unless there has been an "Underwriting Change" such that the policyholder can only purchase a retrospectively rated policy.

(3) Any insurer authorized to transact workers' compensation insurance in Florida shall notify the Office within 30 days of implementing any Significant Underwriting Change that will materially limit or restrict the number of workers' compensation policies or premiums written in Florida. The notification shall include the following:

(a) Name of Insurer or Insurers.

(b) A detailed description of the change.

(c) Anticipated number of policies that will be impacted by the change.

(d) Anticipated percentage of policies in force as of December 31 of the prior year that will be impacted by change.

(e) Estimated written premium impacted by change.

(f) Estimated annual written premium impacted by the change as a percent of total annual written premium for the previous calendar year, excluding the impact of rate changes or payroll changes.

(g) Does change affect some classes more than others? Yes, No or Unknown. If the answer is yes, describe the affected classes.

(h) Date that insurer implemented or anticipates implementing the change.

(i) Effective dates of new and renewal policies that will be affected by the change.

(j) If the change will result in the mid-term cancellation of existing polices, how long will it take for the change to be fully implemented?

(4) The information required by this rule shall be reported through the Office's website at http://www.fldfs.com/companies/.

Specific Authority 624.308(1), 624.4315 FS. Law Implemented 624.4315 FS. History-New 7-25-05.