N.J. Admin. Code § 11:3-16.9

Current through Register Vol. 56, No. 11, June 3, 2024

Section 11:3-16.9 - Data requirements for expense provisions

(a) Filers, not including rating organizations, shall provide the following data regarding expenses, by group of coverages:

1. All information related to the selected expense provisions, specifically including all data used and judgments made;

2. Average expense ratios by line of business for each of the last three complete calendar years for the following expense categories:

i. Commission and brokerage, from New Jersey Page 14 of the Statutory Annual Statement;

ii. Other acquisition expenses, from Part 3 of the Insurance Expense Exhibit;

iii. General expenses, from Part 3 of the Insurance Expense Exhibit; and

iv. Taxes, licenses and fees, from New Jersey Page 14 of the Statutory Annual Statement;

3. The amount of finance and other miscellaneous charges collected in New Jersey in connection with the sale of private passenger automobile insurance; and

4. A description of all products and services supplied or received in transactions between the filer and a parent company, a wholly-owned subsidiary or an affiliated company.

(b) Filers, not including rating organizations, shall provide the derivation of the expense flattening, and the calculation of indicated fixed expense fees on a per exposure basis, as required by 17:29A-37. The expense fees shall be applied by coverage.

(c) In determining the selected expense provision for commission and brokerage, other acquisition expenses and general expenses on a combined basis, the percentage to premium for each year of experience shall be limited as set forth in Exhibit E in the Appendix, incorporated herein by reference.

(d) The following expense items shall not be incorporated into the expense base for determining rates:

1. Fines against the company;

2. Lobbying expenses;

3. Charitable contributions;

4. Political contributions;

5. Awards against the company itself for punitive damages and for bad faith claims; and

6. Advertising and other expenses incurred in connection with proposed changes in the regulation of insurance.

(e) Commissions for bodily injury liability coverage for the Limitation on Lawsuit and No Limitation on Lawsuit options shall be equalized in accordance with Exhibit C in the Appendix, incorporated herein by reference.

(f) All data shall be on a direct basis, including AIRE assessments, AIRE allocations, AIRE investment income, and LAD fees, if applicable, or the expected gain (deficit) resulting from assigned risk business.

(g) Filers, not including rating organizations, shall account for impacts of significant changes to legislative, regulatory, social, economic or operational factors that have an impact on expenses.

N.J. Admin. Code § 11:3-16.9

Emergency Amendment, R.1990 d.621, effective 11/26/1990 (expired January 25, 1991).
See: 22 New Jersey Register 3790(a).
Changes to implement the Fair Automobile Insurance Reform Act, P.L. 1990, c.8.
Adopted Concurrent Proposal, R.1991 d.91, effective 1/25/1991.
See: 22 New Jersey Register 3790(a), 23 New Jersey Register 514(a).
Provision of emergency amendment, R.1990 d.621, readopted with changes effective 2/19/1991.
Amended by R.1996 d.58, effective 2/5/1996.
See: 27 New Jersey Register 3682(a), 28 New Jersey Register 855(a).
In (b)3 deleted exclusions of residual market equalization charges and policy constants.
Amended by R.1998 d.128, effective 3/2/1998.
See: 29 New Jersey Register 5240(a), 30 New Jersey Register 828(a).
Rewrote (a) and (b); in (c), inserted a new second sentence in 2; and in (e), deleted former 2.
Amended by R.2001 d.44, effective 2/5/2001.
See: 32 New Jersey Register 3891(a), 33 New Jersey Register 573(a).
In (a), inserted "for the latest three calendar years" at the end of the sentence in the introductory paragraph; and in (a)2, substituted "three" for "five".
Amended by R.2003 d.173, effective 5/5/2003.
See: 34 New Jersey Register 3475(a), 35 New Jersey Register 1907(a).
Rewrote (a); in (b), deleted 2 and recodified former 3 as 2 and 4 through 5 as 3 through 4; rewrote (c) and (e).
Amended by R.2003 d.499, effective 12/15/2003.
See: 35 New Jersey Register 3084(a), 35 New Jersey Register 5604(a).
In (a)3, deleted reference to the UCJF assessment.
Repeal and New Rule, R.2005 d.176, effective 6/6/2005.
See: 36 New Jersey Register 5640(a), 37 New Jersey Register 2026(a).
Section was "Data requirements for expense and profit provisions".