ORDERS:
ORDER
This matter comes before me pursuant to S.C. CODE ANN. Section 38-73-910 (1976, as
amended); S.C. CODE ANN. Section 38-73-1370, et. seq (Cum. Supp. 1994); and S.C. CODE
ANN Section 1-23-600 (B) (Cum. Supp. 1994) on Petitioners' request for an increase in its
Homeowners loss costs.
STATEMENT OF CASE
On October 23, 1995, Insurance Services Office, Inc. (ISO) made a filing with the Chief
Insurance Commissioner requesting approval of an overall increase of +1.2% in its Homeowners
loss costs with supporting material (ISO filing it 95-RLA1). The filing was amended on
November 17, 1995 and January, 19, 1996.
The hearing in this matter was held before me on February 27, 1996.
Present at the hearing were Mr. James Gray, Esq. representing Insurance Services Office, Inc.;
Mr. Martin M. Simons, Chief Casualty Actuary, South Carolina Insurance Department;
Gwendolyn Fuller, General Counsel, representing the South Carolina Department of Insurance;
and, Mr. Elliott Elam, Jr., Staff Attorney, South Carolina Department of Consumer Affairs.
From testimony, exhibits and arguments presented at the hearing, I find and conclude as follows:
FINDINGS OF FACT
Having carefully considered all testimony, evidence and arguments presented at the hearing in this
matter, by a preponderance of the evidence I find as to the requested revision in Homeowners'
loss costs:
1. Respondent published notice advising the public that an application for a rate increase by
Petitioner had been made and that a hearing would be held on February 27, 1996, in The State,
The Greenville News, The Post and Courier, The Herald, and The Darlington Press.
2. That, the effect of the filer's overall indicated advisory loss cost level change was an increase
of + 1.2% as filed.
3. That, the filer's most recent loss cost level change was an overall decrease of -1.0% effective
on September 1, 1995.
4. That as filed, the filer's indicated, filed, and effect of statewide advisory loss cost level changes
from the current loss costs were:
Form |
|
Indicated |
|
Filed |
|
|
Effect of Change |
HO-2, 3, 3w/15, 8 |
+ 1.3% |
|
+ 1.3% |
|
+ 1.4% |
HO-4 |
|
- 4.0% |
|
- 4.0% |
|
- 3.8% |
HO-6 |
|
-14.7 % |
|
-14.7 % |
|
-14.7 % |
All Forms |
|
+ 1.1% |
|
+ 1.1% |
|
+ 1.2% |
5. That, as a result of informed discovery and negotiations and in agreement with the Respondent
and Intervenor, the Petitioner's proposed loss cost level change was amended at the hearing as
follows resulting in an overall change for the Homeowners costs of -0.7%.
FORM |
|
|
Amended
Loss Cost
Level Change |
|
Effective Loss
Cost Level
Change (A) |
HO-2, 3, 3w/15, &8 |
|
- 0.5% |
|
|
- 0.5% |
HO-4 |
|
|
|
- 4.0% |
|
|
- 3.8% |
HO-6 |
|
|
|
- 14.7% |
|
|
- 14.7% |
ALL FORMS |
|
|
- 0.7% |
|
|
- 0.7% |
(A) The effective change differs from the filed changes due to the rounding to whole dollars of
the filed base class loss costs.
6. That, the revision of the loss costs as presented above is appropriate.
7. That, the filer's proposed effective date will be September 1, 1996.
8. That, the Chief Casualty Actuary has reviewed this filing and the amendment thereto submitted
at the hearing, and has determined that the requested loss cost revision, when used by the ISO
member and subscriber companies, would produce rates that are not excessive, inadequate or
unfairly discriminatory.
9. That, the Consumer Advocate, on behalf of the people of South Carolina and the South
Carolina Department of Consumer Affairs, has also reviewed this filing, and the amendment
thereto submitted at the hearing, and has also determined that the requested loss cost revision,
when used by the ISO member and subscriber companies, would produce rates that are not
excessive, inadequate or unfairly discriminatory.
10. That, based on these facts the Insurance Department and the Consumer Advocate's Office do
not oppose the overall loss cost level changes set forth in Paragraph 5.
11. ISO, as the filer, submitted the pre-filed expert actuarial testimony of Patrick B. Woods. By
stipulation of the parties on the record, this testimony was admitted without objections. He
testified that the requested revisions would produce rates that are not excessive, inadequate or
unfairly discriminatory.
CONCLUSIONS OF LAW
Based upon the foregoing Findings of Fact, I conclude, as a matter of law, the following:
1. The South Carolina Administrative Law Judge Division is empowered to hear this case
pursuant to S.C. Code Ann. §38-73-910 (Law. Co-op. Supp. 1993) and Chapter 23 of Title I of
the South Carolina Code of Laws, as amended.
2. Generally, a request for an insurance rate increase is governed by S.C. Code Ann. §§38-73-10
et seq. (Law. Co-op. Supp. 1993).
3. Pursuant to S.C. Code Ann. §38-73-910 (Law. Co-op. Supp. 1993), notice of the filing and of
the public hearing was given in all newspapers of statewide circulation at least 30 days in advance
of the hearing.
4. Petitioner met the burden of proof in a rate increase request by establishing that the revised
rates would not be excessive, inadequate, or unfairly discriminatory. S.C. Code Ann.
§38-83-10(a)(1) (Law. Co-op. Supp. 1993).
ORDER
IT IS, THEREFORE, ORDERED, ADJUDGED, AND DECREED, that the proposed loss costs
and other changes requested by Petitioner is approved with an effective date of September 1,
1996.
This 4th day of March, 1996.
s/JOHN D. GEATHERS
Administrative Law Judge
Columbia, South Carolina |