Vermont Statutes
Chapter 128 - Property and Casualty Insurance Rate Regulation
§ 4683. Definitions

§ 4683. Definitions
As used in this chapter:
(1) “Advisory or service organization” means any person or organization which assists insurers as authorized by section 4690 of this title, but such an organization shall not include joint underwriting organizations, actuarial or legal consultants, a single insurer, any employees of an insurer, or insurers under common control or management or their employees or managers.
(2) “Classification system” or “classification” means a plan, system, or arrangement for recognizing differences in exposure to hazard among risks.
(3) “Commercial risk insurance” means insurance within the scope of this chapter which is not:
(A) personal risk insurance; or
(B) workers’ compensation and employers’ liability insurance.
(4) “Competitive market” means a market which has not been found to be noncompetitive pursuant to section 4684 of this title.
(5) “Expenses” means that portion of any rate attributable to acquisition, field supervision and collection expenses, general expenses, and taxes, licenses, and fees.
(6) “Experience rating” means a rating procedure utilizing past insurance experience of the individual policyholder to forecast future losses by measuring the policyholder’s loss experience to produce a prospective premium credit, debit, or unity modification.
(7) “Joint underwriting” means a voluntary arrangement established on an ad hoc basis to provide insurance coverage pursuant to which two or more insurers separately contract with the insured at a price and under policy terms agreed upon between the insurers.
(8) “Loss cost” means the actuarially developed portion of the rate needed to cover future losses and claims. The loss cost does not include: commission expenses, other acquisition expenses, general expenses, taxes, profit, and other contingencies.
(9) “Loss trending” means any procedure for projecting developed losses to the average date of loss for the period during which the policies are to be effective.
(10) “Market” means the statewide interaction between buyers and sellers of a particular line of insurance or product market component.
(11) “Noncompetitive market” means a market for which there is a ruling in effect pursuant to section 4684 of this title that a reasonable degree of competition does not exist.
(12) “Personal risk insurance,” other than workers’ compensation and employers’ liability insurance, means homeowners, tenants, private passenger nonfleet automobile, mobile home, and other property and casualty insurance primarily for personal, family, or household needs rather than for business or professional needs.
(13) “Pool” means a voluntary arrangement other than a residual market mechanism, established on an ongoing basis, pursuant to which two or more insurers participate in the sharing of risks on a predetermined basis. The pool may operate through an association, syndicate, or other pooling agreement.
(14) “Pure premium rate” means that portion of the rate which represents the loss cost per unit of exposure or loss cost per unit of insurance.
(15) “Rate” means the cost of insurance per exposure base unit, or cost per unit of insurance, prior to the application of individual risk variations based upon loss or expense considerations, and does not include minimum premiums.
(16) “Residual market mechanism” means an arrangement, either voluntary or mandated by law or regulation of the Commissioner, involving participation by insurers in the equitable apportionment among them of insurance which may be afforded applicants who are unable to obtain insurance through ordinary methods.
(17) “Statistical plan” means a plan, system, or arrangement used in collecting insurance or related data.
(18) “Supplementary rate information” includes any manual, schedule, or plan of rates, classification system, rating schedule, minimum premium, policy fee, rating rule, rating plan, or any other similar information needed or used to determine the applicable premium in effect or to be in effect for an insured.
(19) “Supporting information” means:
(A) the experience and judgment of the filer and the experience or data of other insurers or organizations relied upon by the filer;
(B) the interpretation of any statistical data relied upon by the filer;
(C) the description of methods used in making the rates; and
(D) any other similar information relied upon by the filer. (Added 1983, No. 238 (Adj. Sess.), § 1; amended 1989, No. 128 (Adj. Sess.), § 1.)