Commissioner’s Bulletin # B-0004-16

*PLEASE REVIEW THIS BULLETIN IN ITS ENTIRETY. FILING REQUIREMENTS HAVE CHANGED.*

The commissioner of insurance issued Commissioner's Order No. 4337 dated March 3, 2016, adopting revised Texas workers' compensation classification relativities. The order decreased the classification relativities an average of 10 percent overall from the July 1, 2015, level. The change for any given classification is between -32.5 percent and 12.5 percent.

For workers' compensation policies with effective dates on or after July 1, 2016, the order requires each workers' compensation insurer to adopt the revised classification relativities unless the insurer files an alternate classification rate basis. An alternate classification rate basis may include

• an insurer's own independent insurer-specific classification relativities, or
• the National Council on Compensation Insurance (NCCI) loss costs effective on July 1, 2016. 

Insurers may use the revised classification relativities before July 1, 2016, if they submit a filing to the Texas Department of Insurance 30 days before the selected effective date.

Insurers may not use the July 1, 2015, classification relativities or the July 1, 2015, NCCI loss costs as the basis of their rates for policies with effective dates on or after July 1, 2016.

Actions Required of Insurers

Insurance Code §2053.003 requires each insurer to file with TDI all rates, supplementary rating information, and reasonable and pertinent supporting information for risks written in this state.

Insurers currently writing workers' compensation insurance that plan to continue writing that coverage on or after July 1, 2016, must submit a rate filing no later than June 1, 2016. The rate filing must contain the information specified in the attached "Summary of Actions Required by Insurers 2016."

The "Summary of Actions Required by Insurers 2016" requires more exhibits for all filings than in previous years.

Insurers' rate filings should use the most recently available data and information. An insurer that is not currently writing workers' compensation insurance but plans to write its first policy with an effective date on or after July 1, 2016, must send its rate filing to TDI before the effective date of its first policy.

Filing Forms and Exhibits

The Property and Casualty Filings Made Easy Guide on the TDI website at www.tdi.texas.gov/pubs/pc/rspceasy.html is an aid for making rate filings in Texas. Insurers may provide the required information using the exhibits in the Filings Made Easy Guide, or their own exhibits and formats. TDI revised the exhibits on its website in January 2016. Insurers using those exhibits must use the revised versions.

Property and casualty insurers must comply with the filing requirements in Title 28, Texas Administrative Code, Part 1, Chapter 5, Subchapter M, Division 6. Section 5.9334 addresses the requirements for each rate filing submission. Each of these requirements (along with other categories of information that may be requested) is described in detail in §5.9332 (Categories of Supporting Information).

This bulletin and the documents listed below are located on TDI's website at www.tdi.texas.gov/bulletins/index.html.

Summary of Actions Required by Insurers 2016
Notice of Carrier Intent and Certification
Exhibit A:  Revised Classification Relativities

Where to Send Filings

Submit filings by SERFF, or mail or deliver to Property and Casualty Intake at the appropriate address:

TDI Contact

For further information, please contact Nicole Elliott in the Property and Casualty Actuarial Office by phone at 512-676-6703 or by email at Nicole.Elliott@tdi.texas.gov.

Attachments

Summary of Actions Required by Insurers 2016
Notice of Carrier Intent and Certification
Exhibit A:  Revised Classification Relativities