Insurance Commissioner Jones Releases Guidance On New Rate Review Law
News: 2011 Press Release
Insurance Commissioner Dave Jones today released draft guidance for Senate Bill 1163. The new law, which went into effect on January 1, 2011, requires insurers to provide detailed information regarding proposed premium increases and to submit a certification from an outside actuary to the California Department of Insurance (CDI) for review. The draft guidance which is subject to a 7 day public comment period before it is finalized will provide insurers with the factors that will be used by the department to determine if a rate is unreasonable.
"SB 1163 is intended to provide greater transparency, but it does not provide the Insurance Commissioner with the authority to reject excessive rate increases. I will review health insurance rate filings to determine if the insurer has provided complete and accurate information and whether the proposals are in compliance with the law, but I continue to lack the authority to reject excessive health insurance premium increases," continued Jones.
Under state law, the Insurance Commissioner does not have the authority to reject excessive health insurance rate increases. As a member of the State Assembly, Commissioner Jones authored legislation on three separate occasions to give the Insurance Commissioner this power. This year Jones is supporting AB 52 (Feuer), which would grant the Insurance Commissioner this authority.
"During my time in the Assembly I worked hard to pass legislation to provide the Insurance Commissioner with the ability to reject excessive rate increases. Double digit premium increases are not sustainable for families year after year."
The California Department of Insurance, established in 1868, is the largest consumer protection agency in California. Insurers collect $310 billion in premiums annually in California. Since 2011 the California Department of Insurance received more than 1,000,000 calls from consumers and helped recover over $469 million in claims and premiums. Please visit the Department of Insurance website at www.insurance.ca.gov. Non-media inquiries should be directed to the Consumer Hotline at 800.927.4357. Telecommunications Devices for the Deaf (TDD), please dial 800.482.4833.