ORDERS:
ORDER
This matter is before me upon the Petition of the South Carolina Reinsurance Facility ("Facility")
to approve the recoupment calculations previously submitted to the Chief Insurance Director of
Insurance ("Director") in accordance with Sections 38-77-600 and 38-77-610 of the South
Carolina Code of Laws (1976), as amended. A hearing was held pursuant to the provisions of the
Administrative Procedures Act, as required by Section 38-77-610, on April 10, 1996.
FINDINGS OF FACT
On November 20, 1995, the Governing Board of the Facility, pursuant to Section 38-77610, filed
a recoupment calculation with the Director of Insurance. This recoupment filing displayed the
operational losses of the Facility for the fiscal year ending September 30, 1995, and proposed a
recoupment calculation for the fees to be collected from automobile insureds during the
twelve-month period beginning July 1, 1996.
On January 9, 1996, the Director transmitted the recoupment filing to the Administrative Law
Judge Division for a contested case hearing.
On January 17, 1996, Philip S. Porter, Consumer Advocate for the State of South Carolina, filed
a motion for leave to intervene based upon the statutory standing conferred by Section
37-6-604(1). Neither the Facility nor the Department of Insurance objected to the Consumer
Advocate's intervention and the Consumer Advocate's motion was granted by Order dated
January 23, 1996.
By Order dated January 16, 1996, a April 10, 1996 hearing on this matter was scheduled in
accordance with the Operating Procedures of the Administrative Law Division. Public notice of
the hearing was published more than 30 days in advance of the hearing date in 5 newspapers of
general publication in the State.
Kevin M. Leeman, Director of Financial Services of AIPSO, the Facility's accounting and
statistical agent, and a certified public accountant, testified for the Facility with regard to the
recoupment filing. Mr. Leeman explained that AIPSO served as the Central Processor for the
Facility and performed its accounting and statistical functions. Specifically, Mr. Leeman testified
that the materials filed with the Commissioner had been prepared by him or at his direction. He
described the contents of the filing, the derivation of all data used to determine the recoupment
figures expressed therein and answered questions regarding the calculations.
Neither the Department nor the Consumer Advocate took issue with the filing.
II.
CONCLUSIONS OF LAW
Based upon the pleadings, testimony, evidence and exhibits presented at the hearing, I find and
conclude that the calculations of the recoupment fees prepared by the Facility and filed with the
Director were made in accordance with the provisions of Section 38-77-600 and should be
approved for use by all automobile insurers in this State for the twelve-month period commencing
July 1, 1996. Further, use of the recoupment as calculated in the filing meets all statutory criteria
of being adequate, not excessive and not unfairly discriminatory.
JOHN D. GEATHERS, Administrative Law Judge
Columbia, S.C.
April 11, 1996. |