Notice of Premium Increase of 20 percent or more

STATE OF MARYLAND MARYLAND INSURANCE ADMINISTRATION 525 St. Paul Place, Baltimore, Maryland 21202-2272 Writer’s Direct Dial: 410-468-2011 Facsimile Number: 410-468-2020 e-mail: gcabin@mdinsurance.state.md.us BULLETIN – 03-6 TO: All Property and Casualty Insurers RE: Notice of Premium Increase of 20% or More DATE: May 23, 2003 The purpose of this bulletin is to clarify the requirements regarding notice of an increase in premium of 20% or more. Section 27-604(b) of the Insurance Article states that: Whenever an insurer intends to increase a premium for a particular policy written in the State by 20% or more, the insurer shall notify the insured and insurance producer of the increase. On July 1, 1987, the Insurance Division issued Bulletin No. 1987-2, which provided the Insurance Division’s interpretation of §27-604 of the Insurance Article (then codified as Article 48A, §240A(d)). Bulletin No. 1987-2 limited the notice requirement to increases in premium of 20% or more over and above any premiums resulting from: (1) an increase in the units of exposure; or (2) an experience rating or retrospective rating plan. Bulletin No. 1987-2 also stated that, if an insurer cannot determine the exact amount of a premium increase, the insurer may send a reasonable estimate or range of premium. Effective immediately, Bulletin No. 1987-2 is withdrawn in its entirety. With respect to an increase in premium of 20% or more, insurers must comply with §27-604 of the Insurance Article, Bulletin No. 02-8, and any other applicable statutes, regulations and bulletins. ROBERT L. EHRLICH, JR. GOVERNOR MICHAEL S. STEELE LIEUTENANT GOVERNOR STEVEN B. LARSEN COMMISSIONER DONNA B. IMHOFF DEPUTY COMMISSIONER If you have any questions regarding this bulletin, please contact Sandee Castagna at 410- 468-2341 or by e-mail at scastagna@mdinsurance.state.md.us. _________________________________________ Thomas P. Raimondi Associate Deputy Commissioner