FSCO.TECHNOTES Flashcards
what classes of auto insurance does FSCO’s Tech Notes bulletin apply to?
non-fleet automobile insurance on
* Ontario Automobile Policy (OAP 1)
* Ontario Driver’s Policy (OPF 2)
identify the 5 categories of filing guidelines in FSCO’s Tech notes bulletin
- PPA Filing Guidelines – Major:
→ used when an insurer is initially entering the private passenger automobile insurance market
..or..
→ when changing existing automobile insurance rates but the changes proposed do not meet the criteria for the Simplified Filing Guidelines. - PPA Filing Guidelines - Simplified
- PPA Filing Guidelines – CLEAR Simplified
- Other Than PPA Guidelines - Major
- Other than PPA - Minor
identify legislative requirements for non-fleet auto rate filings in ON
- just and reasonable
- solvency of insurer cannot be impaired
- not be excessive in relation to the financial circumstances of the insurer
identify legislative requirements for non-fleet auto risk classification in ON
- just and reasonable
- predictive of risk
- distinguish fairly between risks
identify 5 items of required information in an Ontario major rate filing
- Loss Data
- Loss Development
- Loss Trend
- On-Level Premium
- Indicated Rate Changes and Proposed Rate Changes
identify 2 requirements for loss data in an Ontario rate filing
- must be specific to Ontario
- must be at the major sub-coverage level
(Valuation data for loss reserving purposes may not satisfy this requirement.)
what conditions must be met if an Ontario insurer is proposing to make territorial definition changes?
- Ontario ≤ 55 territories, City of Toronto ≤ 10 territories
- all territories must be contiguous (you can’t have a territory that isn’t touching the others)
- new territories require 3 years of insurer data and 2,500 annualized average vehicles over the period
- new adjoining territories do not vary by more than +/-10%
- territory definitions are the same for all coverages
- large claims should be capped in establishing territorial rates
once a new discount is approved, how long must an ON insurer continue to offer the discount and why?
3 years - to ensure stability in the market before the insurer can withdraw it from its risk classification system
when is rate capping in ON not permitted?
- base rate changes only
- broker portfolio transfers or acquisitions
- premium decreases (negative capping)