SEC. 83-36-11. Rates and premiums.
(1) [Laws, 1992, ch. 559, Sec. 5, effective from and after July 1, 1992, reenacted this section without change. Since the text of this section as it appears in the parent volume is unaffected by the reenactment, it is not reprinted in this section as directed by the State Attorney General's Office.] The rates, rating plans, rating rules, rating classifications and territories applicable to the insurance written by the association and statistics relating thereto shall be subject to Chapter 3, Title 83, Mississippi Code of 1972, giving due consideration to the past and prospective loss and expense experience for medical malpractice insurance written and to be written in this state, trends in the frequency and severity of losses, the investment income of the association, and such other information as the commission may require, to be based on the experience of loss within the State of Mississippi only. All rates shall be on an actuarially sound basis, giving due consideration to the group retrospective rating plan and the stabilization reserve fund created in Section 83-36-13, and shall be calculated to be self-supporting. The commissioner shall make available to the association the loss and expense experience of insurers previously writing medical malpractice insurance in this state.
(2) All policies issued by the association shall be subject to a nonprofit group retrospective rating plan to be approved by the commissioner under which the final premium for all policyholders of the association, as a group, will be equal to the administrative expenses, loss and loss adjustment expenses, and taxes, plus a reasonable allowance for contingencies and servicing. Policyholders shall be given full credit for all investment income, net of expenses, and a reasonable management fee on policyholder supplied funds. The standard premium, before retrospective adjustment, for each policy issued by the association shall be established for portions of the policy period coinciding with the association's fiscal year on the basis of the association's rates, rating plans, rating rules, rating classifications and territories then in effect. The maximum final premium for all policyholders of the association as a group shall be limited as provided in subsection (5) of Section 83-36-13. Since the business of the association is subject to the nonprofit group retrospective rating plan required by this subsection, there shall be a presumption that the rates filed and premiums for the business of the association are not unreasonable or excessive.
(3) The commissioner shall cause the business of the association to be examined as often as it deems appropriate to assure that the group retrospective rating plan is being operated in a manner consistent with this chapter. If it finds that the plan is not being so operated, it shall issue an order to the association, specifying in what respects the operation is deficient and stating what corrective action shall be taken.
(4) The association shall certify to the commissioner the estimated amount of any deficit remaining after the stabilization reserve fund has been exhausted in payment of the maximum final premium for all policyholders of the association. Within sixty (60) days after such certification, the commissioner shall authorize the members of the association to commence recoupment of their respective shares of the deficit applying a surcharge to be determined by the association at a rate not to exceed two percent (2%) of the annual premiums on future policies affording those kinds of insurance which form the basis for their participation in the association under procedures established by the association. The association shall amend the amount of its certification of deficit to the commissioner as the values of its incurred losses become finalized, and the members of the association shall amend their recoupment procedure accordingly.
(5) In the event that sufficient funds are not available for the sound financial operation of the association, pending recoupment as provided in subsection (4) of this section, all members shall, on a temporary basis, contribute to the financial requirements of the association in the manner provided for in Section 83-36-19 [See Editor's Note, below]. Any such contribution shall be reimbursed to the members by recoupment as provided in subsection (4) of this section.
SOURCES: Laws, 1976, ch. 471, Sec. 6; 1987, ch. 472, Sec. 5, eff from and after July 1, 1987, and shall stand repealed from and after July 1, 1992. Reenacted without change, Laws, 1992, ch. 559, Sec. 5, eff from and after July 1, 1992.
1997 Amendment
Reenacted.
SOURCE: 1997 Laws, Chapter 406, Sec. 6, HB261, Effective July 1, 1997.