Title 26 Insurance Code

26-14-105. Rating standards; methods.

(a) Rates shall not be excessive, inadequate or unfairly discriminatory. (b) Risks may be classified in any way except that no risk may be classified in whole or in part on the basis of race, color, creed or national origin. In determining whether rates in a noncompetitive market are excessive, inadequate or unfairly discriminatory, consideration may be given to the following elements: (i) Basic Rate Factors.-Consideration may be given to past and prospective loss and expense experience within and outside of this state, to catastrophe hazards and contingencies, to events or trends within and outside of this state, to dividends or savings to policyholders, members or subscribers and to all other factors and judgments deemed relevant by the insurer; (ii) Classification.-Rates may be modified for individual risks in accordance with rating plans or schedules which establish standards for measuring probable variations in hazards or expenses, or both; (iii) Expenses.-The expense provisions shall reflect the operating methods of the insurer and, so far as credible, its own actual and anticipated expense experience; and (iv) Contingencies and Profits.-The rates may contain a provision for contingencies and a provision for a reasonable underwriting profit, and shall reflect investment income directly attributable to unearned premium and loss reserves. (c) Repealed by Laws 2021, ch. 138, § 1.