Arrange the following events in the correct chronological sequence to illustrate how a 'deemer provision' operates when an insurer files a new policy form in a prior approval jurisdiction.
- 1The insurer submits the proposed policy form and rate data to the state Department of Insurance.
- 2A statutory waiting period begins, during which the insurer is strictly prohibited from issuing the new policy.
- 3The statutory time limit expires without the Commissioner issuing an official approval, disapproval, or extension request.
- 4The policy form is considered automatically approved by law and the insurer legally begins using it.
Answer
The correct sequence is: submission of the filing, commencement of the waiting period, expiration of the time limit without Commissioner action, and finally, automatic approval via the deemer provision.
In a prior approval system with a deemer provision, the process always starts with the insurer filing the forms. This triggers a statutory waiting period during which the forms cannot be used. If the Commissioner fails to act (neither approving nor disapproving) before this waiting period expires, the deemer provision automatically approves the forms, allowing the insurer to legally implement them without formal written consent.
Step-by-Step Solution
Key Concept
Deemer Provisions and Policy Form Approval