Section Ins 1406.11 - Facility Charges, Premium, and Allowance(a) Each member ceding a policy of automobile insurance covering a private passenger automobile eligible risk to the facility shall give notice of cession to the facility for that eligible risk. The facility shall debit the member's account in the amount of the member premiums ceded. Premium ceded shall be 85 percent of the facility gross premium less commission allowance.(b) Each member ceding eligible risks shall, with respect to losses incurred in connection therewith, subject to the limits of coverage provided in this rule, receive a credit against the sum of such debits and facility gross premiums on ceded business for losses paid less recoveries received each month.(c) The facility shall, quarterly or less frequently as determined by the board, issue summaries to all members reflecting each member's cumulative balances on business it ceded to the facility, providing reimbursement for those members with allowable credits in excess of debits, and shall submit a statement to those members with debits which are in excess of allowable credits. A member so billed for debits shall remit such excess within the period provided in the plan of operation, subject to interest charges at a legal interest rate per month, or fractional part thereof, for late payment as provided therein.(d) A member which in any month reports allowable credits in excess of debits for ceded eligible risks may request reimbursement for such excess. The facility shall reimburse the member for such excess after the board acts upon such request. The board shall act on an insurers request for reimbursement pursuant to this section.(e) The maximum commission allowance which may be credited against the premium ceded to the facility shall be 10 percent of the facility gross premium for those companies paying an actual commission. For all other companies, the maximum commission allowance which may be credited against the premium ceded to the facility shall be 5 percent of the facility gross premium. The charges in lieu of paid commissions shall be allowable only to the extent that such have been filed with the insurance department.(f) SDIP point surcharges shall be applied to the gross base premium as follows: (1) Each member shall cede to the facility 85 percent of the surcharge amounts less commission allowance, according to the SDIP points chargeable in accordance with the provisions of Ins 1406.12 below, to the ceded policy in accordance with the following schedule: a. For a policy subject to 1 SDIP point - 90;b. For a policy subject to 2 SDIP points - 200;c. For a policy subject to 3 SDIP points - 330;d. For a policy subject to 4 SDIP points - 480;e. For a policy subject to 5 SDIP points - 650;f. For a policy subject to 6 SDIP points - 840;g. For a policy subject to 7 SDIP points - 1,040;h. For a policy subject to 8 SDIP points - 1,240; andi. For each additional point - 200; and(2) The surcharge commission shall be $5 for each point to a maximum of $25 per policy or the actual commission allowance, whichever is less.(g) The premium amount to be ceded shall be 85 percent of gross base premium other than SDIP surcharges less 10 percent if commissions are paid or less 5 percent if commissions are not paid plus 85 percent of the SDIP surcharge less the SDIP commission allowance or the actual SDIP commission, whichever is less.N.H. Admin. Code § Ins 1406.11
(See Revision Note #1 at chapter heading for Ins 1400)
Derived from Volume XLI Number 6, Filed February 11, 2021, Proposed by # 13162, Effective 1/25/2021, Expires 1/25/2031.Amended by Number 6, Filed February 9, 2023, Proposed by #13534, Effective 1/24/2023, Expires 1/24/2033.