Loss Ratio

Loss Ratio Benefits under individual long-term care insurance policies shall be deemed reasonable in relation to premiums provided the expected loss ratio is at least sixty percent, calculated in a manner which provides for adequate reserving of the long-term care insurance risk. In evaluating the expected loss ratio, due consideration shall be given to all relevant factors, including: A. Statistical credibility of incurred claims experience and earned premiums; B. The period for which rates are computed to provide coverage; C. Experienced and projected trends; D. Concentration of experience within early policy duration; E. Expected claim fluctuation; F. Experience refunds, adjustments or dividends; G. Renewability features; H. All appropriate expense factors; I. Interest; J. Experimental nature of coverage; K. Policy reserves; L. Mix of business by risk classification; and M. Product features such as long elimination periods, high deductibles and high maximum limits.