Refusals to Issue or Renew Based on Geographic Location and the Use of Catastrophe Models

200 St. Paul Place, Suite 2700, Baltimore, Maryland 21202 Direct Dial: 410-468-2301 Fax: 410-468-2306 Email: pjohnson@mdinsurance.state.md.us 1-800-492-6116 TTY: 1-800-735-2258 www.mdinsurance.state.md.us MARTIN O’MALLEY Governor ANTHONY G. BROWN Lt. Governor BETH SAMMIS Acting Commissioner KAREN STAKEM HORNIG Deputy Commissioner P. RANDI JOHNSON Associate Commissioner Property & Casualty BULLETIN 10-22 DATE: July 15, 2010 TO: All Property and Casualty Insurers and All Interested Parties RE: Refusals to Issue or Renew based on Geographic Location and the use of Catastrophe Models --------------------------------------------------------------------------------------------------------------------- The Maryland Insurance Administration wants to remind all property and casualty insurers of certain filing requirements pertaining to geographic location and the use of catastrophe models. • Insurers proposing to cease writing new and/or renewal business based solely on the geographic location of the risk must comply with §19-107 of the Insurance Article. The specific requirements are outlined in Bulletin 08-01, attached to this document. Specific filing questions should be directed to Shirley Corbin, Property & Casualty Rates & Forms Section at 410-468-2316 or via e-mail at scorbin@mdinsurance.state.md.us. • Insurers who use a catastrophic risk planning model or other model to establish rates and rules or underwriting guidelines for homeowners’ insurance policies are required to comply with § 19-211 of the Insurance Article. The rate filing must identify and describe the model; the actual model need not be filed. In addition, the filer must contact Ms. Corbin to schedule a time for the owner or vendor of the model to come to the Maryland Insurance Administration (MIA) to demonstrate the model and explain in detail the data used in the model and the manner in which the output is obtained. Filers using the NAIC SERFF system to submit their filings should, for purposes of consistency, use the Supporting Document Tab to attach the required documentation describing the model. The attachment should be named “19-211”. If the filer elects to have the filing confidential, as authorized by the statute, the filer is to check “Not Available for Public Access.” For additional specifics regarding the submission of these filings, please refer to the Maryland P C General Instructions in SERFF. Filers using the paper Property & Casualty Transmittal Document to submit their filings should, for purposes of consistency, insert the name “19-211” in item 11. (“State Specific Product code(s)”). If the filer wishes to have the filing remain confidential, as authorized by the statute, the filer should 1 2 specifically request same. For additional specifics regarding the submission of these filings, please refer to the Maryland PC General Instructions found on the Maryland Insurance Administration’s website. Technical questions regarding this bulletin should be directed to Dave Diehl, Chief Administrator for P&C, at 410-468-2320 or ddiehl@mdinsurance.state.md.us. Beth Sammis, Acting Insurance Commissioner By: Signature on File With Original P. Randi Johnson, Associate Commissioner Property & Casualty