N.Y. Comp. Codes R. & Regs. tit. 11 § 70.10

Current through Register Vol. 46, No. 45, November 2, 2024

Section 70.10 - Physicians and surgeons medical malpractice insurance policy provisions for the period commencing July 1, 1989; established rates

(a) Section 19 of chapter 184 of the Laws of 1988 requires the superintendent to establish rates for physicians and surgeons medical malpractice policies for the policy period July 1, 1989 through June 30, 1990. Section 40 of chapter 266 of the Laws of 1986, as amended by chapters 184 and 186 of the Laws of 1988, requires the superintendent to establish a surcharge, of up to eight percent, on the established rates for such medical malpractice policies for the policy period July 1, 1989 through June 30, 1990, if required to satisfy any deficiency for the policy periods July 1, 1985 through June 30, 1989.

(b) The superintendent has reviewed the reports mandated by sections 70.8(h) and 70.9(f) of this Part, taken into account the factors set forth for consideration in section 1 of chapter 184 of the Laws of 1988, and evaluated the financial condition of insurers issuing policies of medical malpractice insurance, as reflected by examinations conducted in accordance with section 310 of the Insurance Law. As a result of review and consideration, the superintendent has determined that a deficiency exists, in certain instances, for the policy periods July 1, 1985 through June 30, 1989.

(c) Rates and surcharges for occurrence policies providing primary coverage, up to $1 million/$3 million, issued or renewed during the period July 1, 1989 through June 30, 1990, shall be as follows:

(1) For Frontier Insurance Company, rates shall be those established pursuant to section 70.9(c)(1)(i) of this Part and no surcharge shall be collected for this insurer.

(2) For Group Council Mutual Insurance Company, rates shall be five percent greater than those established pursuant to section 70.9(c)(1)(i) of this Part and, in addition, a surcharge of four percent shall be collected for this insurer.

(3) For Medical Liability Mutual Insurance Company, rates in the counties of Bronx, Columbia, Dutchess, Greene, Kings, Nassau, New York, Orange, Queens, Putnam, Richmond, Rockland, Suffolk, Sullivan, Ulster and Westchester shall be 1.6 percent greater than those established pursuant to section 70.9(c)(1)(i) of this Part. Rates for this insurer in all other counties shall be five percent less than those established pursuant to section 70.9(c)(1)(i) of this Part. No surcharge shall be collected for this insurer.

(4) For the Medical Malpractice Insurance Association, rates in the counties of Bronx, Columbia, Dutchess, Greene, Kings, Nassau, New York, Orange, Queens, Putnam, Richmond, Rockland, Suffolk, Sullivan, Ulster and Westchester shall be 1.6 percent greater than those established pursuant to section 70.9(c)(1)(i) of this Part. Rates for this insurer in all other counties shall be five percent less than those established pursuant to section 70.9(c)(1)(i) of this Part. No surcharge shall be collected for this insurer.

(5) For Physicians Reciprocal Insurers rates shall be five percent greater than those established pursuant to section 70.9(c)(1)(i) of this Part and, in addition, a surcharge of four percent shall be collected for this insurer.

(6) For all other insurers, rates shall be those established by paragraph (3) of this subdivision, unless the insurer can demonstrate to the satisfaction of the Superintendent that another rate is appropriate. No surcharge shall be collected for any such insurer unless specifically required by the superintendent.

(d) Rates for policies providing excess coverage issued or renewed during the period July 1, 1989 through June 30, 1990 shall be as follows, and no surcharges shall be collected on these policies:

(1) For a first excess layer providing $1 million/$3 million of excess coverage above $1 million/$3 million primary coverage, and purchased directly by a physician, the rate shall be 40 percent of the $1 million/$3 million rate for primary coverage established for the Medical Malpractice Insurance Association in accordance with subdivision (c) of this section.

(2) For a first excess layer providing $1 million/$3 million of excess coverage above $1 million/$3 million primary coverage, and purchased by a hospital in accordance with section 18 of chapter 184 of the Laws of 1988, the rate shall be 43 percent of the $1 million/$3 million rate for primary coverage established for the Medical Malpractice Insurance Association in accordance with subdivision (c) of this section.

(3) For a second excess layer providing $1 million/$3 million of excess coverage above the underlying primary coverage and first layer of excess coverage, described in paragraphs (1) and (2) of this subdivision, the rate shall be 30 percent of the $1 million/$3 million rate for primary coverage established for the Medical Malpractice Insurance Association in accordance with subdivision (c) of this section.

(e)Claims-made primary and excess coverage rates.

(1) Claims-made coverage rates. The rate for a claims-made policy shall be the corresponding occurrence rate multiplied by the appropriate claims-made factor, as follows:

*Year in claims-made program*	*Claims-made factor*
First:	31%
Second:	64
Third:	85
Fourth:	94
Fifth:	99
Sixth:	102
Seventh:	104
Eighth:	105

(2) Optional extended reporting period (tail) rates.

(i) The rate for optional tail coverage required to be offered for a claims-made policy shall be the corresponding occurrence rate multiplied by the appropriate tail factor, as follows:

*Number of years completed in claims-made program*	*Tail factor*
One:	74.8%
Two:	122.1
Three:	146.4
Four:	162.4
Five:	173.3
Six:	181.0
Seven:	186.7
Eight:	190.6

(ii) For a policy terminated on a date other than its anniversary date, the tail factor shall be obtained by interpolation, on a daily basis, between the tail factors applicable to the preceding and following policy anniversaries.

(iii) For any policy written at a reduced rate because the insured was eligible for a new-doctor discount, the tail premium shall be reduced by the percentage that the current year's rate (exclusive of any surplus contributions) was reduced as a result of such new-doctor discount.

(3) Rates for claims-made and tail excess coverage policies purchased by hospitals. The aggregate rate for a claims-made excess coverage policy and its simultaneously issued tail mandated subdivision (f) of this section, purchased by a general hospital on behalf of a physician, shall equal the corresponding occurrence excess coverage rate.

(f)Excess coverage-types of policies: required tail.

(1) Pursuant to section 18 of chapter 184 of the laws of 1988, excess coverage policies providing $1 million/$3 million of excess coverage above $1 million/$3 million primary coverage, purchased by general hospitals on behalf of physicians, shall cover occurrences from July 1, 1989 through June 30, 1990. Accordingly, all physicians and surgeons medical malpractice liability insurers that issue such an excess policy on a claims-made basis shall simultaneously issue full tail coverage.

(2) Except where required to be issued on a claims-made basis pursuant to section 5504(f), excess coverage policies issued or renewed on and after July 1, 1989 shall provide coverage on either an occurrence or claims-made basis, subject to paragraph (1) of this subdivision, provided that:

(i) An excess coverage policy shall be renewed on the same basis (occurrence or claims-made) as previously issued, except that the insured may choose to substitute claims-made coverage for occurrence coverage.

(ii) If the insured so requests, an excess coverage policy issued by the same insurer that issued the underlying primary coverage shall be issued with the same type of coverage (occurrence or claims-made) as the primary coverage.

(3) The provisions of section 70.7(b)(2) and (d) of this Part, continue to apply to all medical malpractice liability insurers.

(g)Required filings-primary coverage.

(1) No later than August 1, 1989, all physicians medical malpractice liability insurers are required to file amended rate manual pages with the superintendent in accordance with the primary coverage rates established by this Part.

(h)Required filings-excess coverage.

(2) No later than August 1, 1989, insurers writing, or required to write, excess layers other than for which rates are specifically established by this Part shall file proposed rates with supporting documentation.

(i)Rate service organizations.

(1) A physicians medical malpractice liability insurance rate filed by a rate service organization on behalf of its members and subscribers shall be established in accordance with this Part. Any such organization shall make the appropriate rate filing required by subdivisions (g) and (h) of this section no later than August 1, 1989.

(j)Purchasing groups.

The rates and rating plans for medical malpractice liability insurance issued by an insurer to a Federal purchasing group and its members shall be established in accordance with the provisions of this Part, except that, if the insurer and the purchasing group have complied with all applicable provisions of the Liability Risk Retention Act, 15 USC 3901et seq., and Part 301 of this Title, and if the insurer submits rates or a rating plan affording advantages, based on the purchasing group's loss and expense experience, not afforded to other persons, the superintendent shall review such submission, and thereafter establish rates or a rating plan, as appropriate, reflecting such advantages. Any such insurer shall file no later than August 1, 1989 proposed rates with adequate supporting documentation.

N.Y. Comp. Codes R. & Regs. Tit. 11 § 70.10