23 CAR pt. 89, Appendix A. Medicare Supplement Refund Calculation Form

APPENDIX A MEDICARE SUPPLEMENT REFUND CALCULATION FORM FOR CALENDAR YEAR TYPE' For the State of SMSBP2 Company Name NAIC Group Code NAIC Company Code Address Person Completing Exhibit Title Telephone Number Line (a) Earned Premium3 (b) Incurred Claims4 1. Current Year's Experience a. Total (all policy years) b. Current year's issues c. Net (for reporting purposes = la— lb 2. Past Years' Experience (all policy years) 3. Total Experience (Net Current Year + Past Year) 4. Refunds Last Year (Excluding Interest) 5. Previous Since Inception (Excluding Interest) 6. Refunds Since Inception (Excluding Interest) 7. Benchmark Ratio Since Inception (see worksheet for Ratio 1) 8. Experienced Ratio Since Inception (Ratio 2) Total Actual Incurred Claims (line 3, col. b) Total Earned Prem. (line 3, col. a)—Refunds Since Inception (line 6) 9. Life Years Exposed Since Inception If the Experienced Ratio is less than the Benchmark Ratio, and there are more than 500 life years exposure, then proceed to calculation of refund. 10. Tolerance Permitted (obtained from credibility table) Medicare Supplement Credibility Table Life Years Exposed Since Inception Tolerance 10,000 + 0.0% 5,000 9,999 5.0% 2,500 -4,999 7.5% 1,000 -2,499 10.0% 500 - 999 15.0% If less than 500, no credibility. 1 Individual, Group, Individual Medicare Select, or Group Medicare Select Only. 2 "SMSBP" = Standardized Medicare Supplement Benefit Plan - Use "P" for pre-standardized plans. 3 Includes Modal Loadings and Fees Charged 4 Excludes Active Life Reserves 5 This is to be used as "Issue Year Earned Premium" for Year 1 of next year's "Worksheet for Calculation of Benchmark Ratios" MEDICARE SUPPLEMENT REFUND CALCULATION FORM FOR CALENDAR YEAR TYPE' SMSBP2 For the State of Company Name NAIC Group Code NAIC Company Code Address Person Completing Exhibit Title Telephone Number 11. Adjustment to Incurred Claims for Credibility Ratio 3 = Ratio 2 + Tolerance If Ratio 3 is more than Benchmark Ratio (Ratio 1), a refund or credit to premium is not required. If Ratio 3 is less than the Benchmark Ratio, then proceed. 12. Adjusted Incurred Claims [Total Earned Premiums (line 3, col. a)—Refunds Since Inception (line 6)] x Ratio 3 (line 11) 13. Refund = Total Earned Premiums (line 3, col. a)—Refunds Since Inception (line 6) —[Adjusted Incurred Claims (line 12)/Benchmark Ratio (Ratio 1)] If the amount on line 13 is less than .005 times the annualized premium in force as of December 31 of the reporting year, then no refund is made. Otherwise, the amount on line 13 is to be refunded or credited, and a description of the refund or credit against premiums to be used must be attached to this form. I certify that the above information and calculations are true and accurate to the best of my knowledge and belief. Signature Name - Please Type Title - Please Type Date REPORTING FORM FOR THE CALCULATION OF BENCHMARK RATIO SINCE INCEPTION FOR GROUP POLICIES FOR CALENDAR YEAR TYPE' SMSBP2 For the State of Company Name NAIC Group Code NAIC Company Code Address Title Telephone Number Person Completing Exhibit (a)3 (b)4 (c) (d) (e) (1) (g) (h) (1) (i) (05 Year Earned Premium Factor (b)x(c) Cumulative Loss Ratio (d)x(e) Factor (b)x(g) Cumulative Loss Ratio (h)x( ) Policy Year Loss Ratio 1 2.770 0.507 0.000 0.000 0.46 2 4.175 0.567 0.000 0.000 0.63 3 4.175 0.567 1.194 0.759 0.75 4 4.175 0.567 2.245 0.771 0.77 5 4.175 0.567 3.170 0.782 0.80 6 4.175 0.567 3.998 0.792 i 0.82 7 4.175 0.567 4.754 0.802 0.84 8 4.175 0.567 5.445 0.811 0.87 9 4.175 0.567 6.075 0.818 0.88 10 4.175 0.567 6.650 0.824 0.88 11 4.175 0.567 7.176 , 0.828 0.88 12 4.175 0.567 7.655 0.831 0.88 13 4.175 0.567 8.093 0.834 0.89 14 , 4.175 0.567 8.493 0.837 0.89 15+6 4.175 0.567 8.684 0.838 0.89 Total: ' (k): (1): (m): (n): Benchmark Ratio Since Inception: (1+ n)/(k + m): I Individual, Group, Individual Medicare Select, or Group Medicare Select Only. 2 "SMSBP" = Standardized Medicare Supplement Benefit Plan - Use "P" for pre-standardized plans 3 Year 1 is the current calendar year - 1. Year 2 is the current calendar year - 2 (etc.) (Example: If the current year is 1991, then: Year 1 is 1990; Year 2 is 1989, etc.) 4 For the calendar year on the appropriate line in column (a), the premium earned during that year for policies issued in that year. 5 These loss ratios are not explicitly used in computing the benchmark loss ratios. They are the loss ratios, on a policy year basis, which result in the cumulative loss ratios displayed on this worksheet. They are shown here for informational purposes only. 6 To include the earned premium for all years prior to as well as the 15th year prior to the current year. REPORTING FORM FOR THE CALCULATION OF BENCHMARK RATIO SINCE INCEPTION FOR INDIVIDUAL POLICIES FOR CALENDAR YEAR TYPE' SMSBP2 For the State of Company Name NAIC Group Code Address Person Completing Exhibit Title Telephone Number NAIC Company Code (a)3 (b)4 (c) (d) (e) ) (g) (h) (i) (i) (o)5 Year Earned Premium Factor (b)x(c) Cumulative Loss Ratio (d)x(e) Factor (b)x(g) Cumulative Loss Ratio (h)x(i) Policy Year Loss Ratio I 2.770 0.442 0.000 0.000 0.40 2 4.175 0.493 0.000 0.000 0.55 3 4.175 0.493 1.194 0.659 0.65 4 4.175 0.493 2.245 0.669 0.67 5 4.175 0.493 3.170 0.678 0.69 6 4.175 0.493 3.998 0.686 0.71 7 4.175 0.493 4.754 0.695 1 0.73 8 4.175 0.493 5.445 0.702 0.75 9 4.175 0.493 6.075 0.708 0.76 10 4.175 0.493 6.650 0.713 0.76 11 4.175 1 0.493 7.176 0.717 1 0.76 12 4.175 0.493 7.655 0.720 0.77 13 4.175 0.493 8.093 0.723 0.77 14 4.175 0.493 8.493 0.725 0.77 15+6 4.175 0.493 8.684 0.725 0.77 Total: (k): (1): (m): (n): Benchmark Ratio Since Inception: (1 + n)i(k + m): Individual, Group, Individual Medicare Select, or Group Medicare Select Only. 2 "SMSBP" = Standardized Medicare Supplement Benefit Plan - Use "P" for pre-standardized plans 3 Year 1 is the current calendar year - 1. Year 2 is the current calendar year - 2 (etc.) (Example: If the current year is 1991, then: Year 1 is 1990; Year 2 is 1989, etc.) 4 For the calendar year on the appropriate line in column (a), the premium earned during that year for policies issued in that year. 5 These loss ratios are not explicitly used in computing the benchmark loss ratios. They are the loss ratios, on a policy year basis, which result in the cumulative loss ratios displayed on this worksheet. They are shown here for informational purposes only. 6 To include the earned premium for all years prior to as well as the 15th year prior to the current year.