The Mississippi Insurance Department (MID) does not approve rate increases on any
type of accident and health policies other than Medicare Supplement policies and
Long Term Care policies. MID only acknowledges and files rate increases on all other
types of policies. In the notification of a rate increase to the insured, please
do not state that MID approved the rate increase unless the rate increase was for
a Medicare Supplement policy or a Long Term Care policy. The term "policy" also
includes certificates issued under a group master policy. Please note a Company
may not implement a rate increase on any type of policy and/or certificate until
the Company has provided all of the information requested herein and has received
proper notification from the MID that it has either “Approved” or “Acknowledged
and Filed” the rate increase request, depending upon the type of policy. The insured
must be given at least 60 days prior notice before any rate increase can be implemented.
A rate increase is subject to Regulation 73-4 and Bulletin 94-1. Regulation 73-4
requires a Company implement a rate increase by means of an approved endorsement
to be sent to the insured for attachment to the policy. Bulletin 94-1 requires that
rate increases be limited to 25% in any one- policy year, unless the procedures
developed by MID to implement a rate increase greater that 25% are followed. Please
note that all trust and association rate increase filings are subject to Regulation
73-4 and Bulletin 94-1.
The following information should be provided each time a rate increase is requested:
- An actuarial memorandum prepared in accordance with the applicable Actuarial Standards
- Explanation of the reason for the rate increase and the percentage amount of the
rate increase stated in Item 14 of the LH Transmittal Document.
- A history of each of the prior rate increases that were filed with the MID. The
history should include the date each of the prior rate increases was effective and
the percentage amount of each of the prior rate increases.
- The policy year and calendar year loss ratios expected at the time the original
premiums for the policy year were developed.
- A side-by-side comparison of the expected loss ratios with the actual loss ratios,
both on a policy year basis and a calendar year basis.
- A statement that the rate increases comply with the requirements of Bulletin 94-1
and Regulation 73-4. A copy of the endorsement required by Regulation 73-4 should
accompany each request for a rate increase. Regulation 73-4 requires that an endorsement
be sent to each insured each time a rate increase is implemented. The company may
use a letter to notify the insured of a rate increase, but the letter must have
a form number and must be filed with MID for approval. Once MID has approved the
amendment (or letter to be used as an amendment), the L&H Transmittal Document requesting
each rate increase from then on must state that the amendment has been approved
by the MID and state the date it was approved.
- The date the policy was approved by MID.
- If the Company is offering a reduction in the amount of the rate increase in exchange
for an increase in the deductible or coinsurance or a reduction in benefits, provide
a complete actuarial justification that the changes are actuarially equivalent,
i.e., the dollar amount of rate increase reduction is actuarially equivalent to
the change in benefits.