N.M. Code R. § 13.18.2.33

Current through Register Vol. 35, No. 11, June 11, 2024

Section 13.18.2.33 - FORM CI-DRF: PART C - DETERMINATION OF DEVIATED PRESUMPTIVE CASE RATE

A.Single account cases: If the account is 100 percent credible or if it is within the definition of single account case as filed by the insurer, the deviated presumptive case rate for the account will be determined by the appropriate formula set forth in Subsection C of 13.18.2.33 NMAC below.

B.Multiple account cases: If the account is in a multiple account case, the deviated presumptive case rate for the account will be the case rate for that multiple account case determined by the appropriate formula set forth in Subsection C of 13.18.2.33 NMAC below.

C.Calculation of deviated presumptive case rates.

(1) Symbols and definitions:

(a) NCR = new case rate;

(b) PFR = presumptive rate;

(c) ALR = actual loss ratio for case at presumptive rate basis;

(d) ELR = expected loss ratio at presumptive rate basis;

(e) Z = credibility factor for case;

(f) CLR = credibility adjusted case loss ratio at presumptive basis = Z(ALR) = (1-Z)(ELR).

(2) New case rate: credit life insurance:

(a) if CLR is greater than ELR, NCR = PFR [1 + 1.1. (CLR - ELR)];

(b) if CLR is less than ELR, NCR = PFR [1 - (ELR - CLR)].

(3) New case rate: credit disability insurance:

(a) if CLR is greater than ELR, NCR = PFR [1 + 1.2 (CLR ELR)];

(b) if CLR is less than ELR, NCR = PFR [1 - (ELR - CLR)].

N.M. Code R. § 13.18.2.33

7/1/97; 13.18.2.33 NMAC - Rn, 13 NMAC 18.2.33, 12/31/07