2006 Louisiana Laws - RS 22:1430.12 — Rates, rating plans, and rate rules applicable

§1430.12.  Rates, rating plans, and rate rules applicable

A.(1)  As residual markets, the plans made available by the Louisiana Citizens Property Insurance Corporation are not intended to offer rates competitive with the voluntary market.  Rates for policies issued under the Coastal Plan and the FAIR Plan shall be set by the governing board of the Louisiana Citizens Property Insurance Corporation, adjusted annually, shall be actuarially justified, and, except for coverages authorized under R.S. 22:1430.1(6)(b), shall exceed by at least ten percent the rates charged among the ten insurers with the greatest total direct written premium in each parish for that line of business in the preceding year; except that with respect to mobile home coverages, the average rates of the plans shall exceed by at least ten percent the rates charged among the five insurers with the greatest total written premium for mobile homeowners' policies in each parish in the preceding year.  Such rates shall include an appropriate catastrophe loading factor and may include rules for classification of risks insured hereunder and rate modifications hereof.  Except for coverages authorized under R.S. 22:1430.1(6)(b), the rates charged in a particular parish shall exceed by at least ten percent the rates of any insurer that has a minimum of three percent of the total premium for the parish.  The exclusion of wind and hail coverages which are subject to the ten percent surcharge authorized in this Section shall terminate on January 1, 2009.

(2)  The method used to determine the rates charged among the ten insurers with the greatest total direct written premium in each parish and used to determine the rates charged among the five insurers with the greatest total written premium for mobile homeowners' policies in each parish shall be set forth in the annual rate review provided by the governing board and shall be documented in the rate filing as required in Subsection C of this Section.

(3)  Prior to determining any such rates the governing board shall adopt such formulas as may be necessary for determining the rates.

B.  In addition to the rates otherwise determined pursuant to this Section, including the premium tax provided for in R.S. 22:1065, the corporation shall impose and collect an additional amount equal to the premium tax provided for in R.S. 22:1065 to augment the financial resources of the corporation.  Said additional amount equal to the premium tax shall be designated as a charge accruing to the state of Louisiana, but shall be retained by the corporation as a state contribution to the corporation for the public purpose as set forth in R.S. 22:1430.

C.  The corporation shall make a rate filing at least once a year for the plans, and nothing in this Section shall require or permit the corporation to adopt a rate that is inadequate under R.S. 22:1401 et seq. Subject to the provisions of Subsections A and B of this Section, the rates shall be approved by the Louisiana Insurance Rating Commission prior to use.

Acts 2003, No. 1133, §1; Acts 2005, No. 217, §1, eff. June 29, 2005; Acts 2006, No. 787, §1.