Arrange the following procedural steps in the correct chronological sequence for a rate filing under a 'prior approval' regulatory system, resulting in an administrative appeal.
- 1The insurer formally submits proposed rates and actuarial data to the Department of Insurance.
- 2The Commissioner reviews the submission during the statutory waiting period.
- 3The Commissioner issues a written notice of disapproval before the waiting period expires.
- 4The insurer files a written demand for an administrative hearing to appeal the decision.
- 5The Department conducts an administrative hearing to reach a final determination.
Answer
The correct sequence begins with the rate submission, followed by the Commissioner's review, the issuance of a disapproval notice, the insurer's demand for a hearing, and finally, the execution of the administrative hearing.
In a prior approval jurisdiction, an insurer cannot use new rates until they are approved by the Commissioner. The procedural sequence begins with the insurer filing the rates, followed by the Commissioner's review during a statutory waiting period. If the Commissioner determines the rates violate state standards, a disapproval notice is issued before the waiting period ends. The insurer then has the right to demand an administrative hearing to appeal the decision, culminating in the hearing itself.
Step-by-Step Solution
Key Concept
Prior Approval Rate Regulation and Administrative Appeals