PRINTER'S NO. 3309
No. 2524 Session of 1978
INTRODUCED BY LIVENGOOD, KOWALYSHYN, SCHMITT, C. GEORGE, LOGUE,
FEE, PETRARCA, DeMEDIO, A. K. HUTCHINSON, MILANOVICH,
F. TAYLOR, MILLIRON, BURD, D. R. WRIGHT, WISE, ZELLER AND
HARPER, JUNE 5, 1978
REFERRED TO COMMITTEE ON INSURANCE, JUNE 5, 1978
AN ACT
1 Amending the act of June 11, 1947 (P.L.538, No.246), entitled
2 "An act relating to the regulation of rates for insurance
3 which may be written by stock or mutual casualty insurance
4 companies, associations or exchanges, including fidelity,
5 surety and guaranty bonds and all other forms of motor
6 vehicle insurance, and title insurance; to rating and
7 advisory organizations; conferring on the Insurance
8 Commissioner the power and duty of supervising and regulating
9 persons, associations, companies and corporations, and of
10 enforcing the provisions of this act; prescribing and
11 regulating the practice and procedure before the
12 commissioner, and procedure for review by the courts; giving
13 the Court of Common Pleas of Dauphin County exclusive
14 jurisdiction over certain proceedings; prescribing penalties
15 and providing for enforcement thereof, and repealing
16 inconsistent acts," prohibiting the use of certain
17 classifications for the purpose of setting rates.
18 The General Assembly of the Commonwealth of Pennsylvania
19 hereby enacts as follows:
20 Section 1. Section 3, act of June 11, 1947 (P.L.538,
21 No.246), known as "The Casualty and Surety Rate Regulatory Act,"
22 is amended to read:
23 Section 3. Making of Rates.--All rates shall be made in
24 accordance with the following provisions:
1 (a) Due consideration shall be given to past and prospective
2 loss experience within and outside this Commonwealth, to
3 physical hazards, to safety and loss prevention factors, to
4 underwriting practice and judgment to the extent appropriate, to
5 catastrophe hazards, if any, to a reasonable margin for
6 underwriting profit and contingencies, to dividends, savings or
7 unabsorbed premium deposits allowed or returned by insurers to
8 their policyholders, members or subscribers, to past and
9 prospective expenses both country wide and those specially
10 applicable to this Commonwealth, and to all other relevant
11 factors within and outside this Commonwealth;
12 (b) The systems of expense provisions included in the rates
13 for use by any insurer or group of insurers may differ from
14 those of other insurers or groups of insurers to reflect the
15 requirements of the operating methods of any such insurer or
16 group with respect to any kind of insurance, or with respect to
17 any subdivision or combination thereof for which subdivision or
18 combination separate expense provisions are applicable;
19 (c) Risks may be grouped by classifications for the
20 establishment of rates and minimum premiums. Classification
21 rates may be modified to produce rates for individual risks in
22 accordance with rating plans which establish standards for
23 measuring variations in hazards or expense provisions, or both.
24 Such standards may measure any differences among risks that can
25 be demonstrated to have a probable effect upon losses or
26 expenses. In no event shall rates by classified or based in any
27 way on the sex or marital status of the insured;
28 (d) Rates shall not be excessive, inadequate or unfairly
29 discriminatory.
30 Section 2. This act shall take effect in 60 days.
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