N.Y. Insurance Law § 2328: For hire motor vehicle insurance rates; flexible rating; prior approval

§ 2328. For hire motor vehicle insurance rates; flexible rating; prior

approval. (a) An insurer shall submit to the superintendent, for the

superintendent's prior approval, its rates, rating plans, rating rules,

and rate manuals applicable to motor vehicle insurance, including

no-fault coverages under article fifty-one of this chapter, by August

first, two thousand twenty-five and at least every two years thereafter,

unless the superintendent requests the rates, rating plans, rating

rules, or rating manuals more frequently. For rates submitted on or

before August first, two thousand twenty-five, the superintendent may

approve the phasing in of rates that meet the standards set forth in

section two thousand three hundred three of this article if the

superintendent determines that it would be in the best interests of the

people of this state.

(b) Except as provided in subsection (c) of this section, no changes

in rates, rating plans, rating rules and rate manuals applicable to

motor vehicle insurance, including no-fault coverages under article

fifty-one of this chapter, shall be made effective until approved by the

superintendent, notwithstanding any inconsistent provisions of this

article.

(c) Starting December first, two thousand twenty-five, overall average

(for all coverages combined) rate level increases above an insurer's

rates in effect that are up to a percentage specified in a regulation

promulgated by the superintendent but not to exceed five percent during

any twelve-month period, may take effect without the superintendent's

prior approval after submitting an informational filing pursuant to

section two thousand three hundred ten of this article. An insurer shall

not implement more than two rate increases pursuant to this section, the

total of which shall not exceed the limitation specified in a

regulation, during any twelve-month period. An insurer also shall not

implement a rate increase within the limitation specified in a

regulation until the onset of the new policy period and unless the

insurer, at least thirty but not more than sixty days in advance of the

end of the policy period, mails or delivers to the named insured, at the

address shown in the policy, a written notice of its intention to change

the rate. The specific reason or reasons for the rate change shall be

stated in or shall accompany the notice. An insurer shall not implement

a rate change under this subsection when the insurer: (1) has submitted

a rate filing under subsection (a) of this section and the

superintendent has not yet approved it; or (2) is in the process of

phasing in its rates pursuant to the superintendent's approval under

subsection (a) of this section.

(d) The superintendent shall monitor the degree and continued

existence of competition and the effectiveness of flexible rating in

this state on an on-going basis. In doing so, the superintendent shall

utilize the following standards or factors:

(1) the standards contained in section two thousand three hundred

eight of this article;

(2) existing relevant information, analytical systems and other

sources, or rely on some combination thereof;

(3) the number of insurers or group of affiliated insurers actively

engaged in providing coverage, taking into account the specialization

traditionally required for insurance in the particular rating territory;

(4) measures of market concentration and changes of market

concentration over time, which may include the use of

Herfindahl-Hirschman Index (HHI) and the United States Department of

Justice merge guidelines for an unconcentrated market ease of entry, and

the existence of financial or economical barriers that could prevent new

firms from entering the market;

(5) the extent to which any insurer or group of affiliated insurers

controls all or a dominant portion of the market has actively sought to

prevent competition;

(6) whether the total number of companies writing the line of

insurance in this state is sufficient to provide multiple options;

(7) the availability of insurance coverage to consumers;

(8) the opportunities available to consumers in the market to acquire

pricing and other consumer information; and

(9) any other factors relevant to inquiry.

Such activities may be conducted internally within the department, in

cooperation with other state insurance departments, through outside

contractors and/or in any other appropriate manner, provided that the

department shall report to the speaker of the assembly, temporary

president of the senate, and governor on the effectiveness of flexible

rating on the for hire motor vehicle market by December first, two

thousand twenty-seven and every two years thereafter.

(e) This section shall apply only to policies covering losses or

liabilities arising out of ownership of a motor vehicle used principally

for the transportation of persons for hire, including a bus or a school

bus as defined in sections one hundred four and one hundred forty-two of

the vehicle and traffic law, provided, however, that subsections (a) and

(c) of this section shall not apply to a bus or a school bus as defined

in sections one hundred four and one hundred forty-two of the vehicle

and traffic law.