17:48F-17.3 Determination of increase, revision or redetermination; factors.
38. In determining any increase, revision or redetermination in the capital or surplus of a prepaid prescription service organization pursuant to the provisions of section 37 of Phamplet Law 2014, Chapter 81 (C. 17:48F-17.2) the commissioner shall take into account the following factors:
a. Methods and techniques used to measure risk exposure and variability;
b. The information available relating to the magnitude of the various risks described in section 37 of Phamplet Law 2014, Chapter 81 (C. 17:48F-17.2);
C. The extent to which risks described in section 37 of Phamplet Law 2014, Chapter 81 (C. 17:48F-17.2) are independent or interrelated, and whether any dependency is direct or inverse;
d. The extent to which the prepaid prescription services organization has provided protection against contingencies in ways other than the establishment of surplus, including, but not limited to: redundancy of premiums; margin in reserves and liabilities; adjustability of contracts pursuant to the terms of the contracts; voluntary or mandatory investment valuation reserves; reinsurance; the use of conservative actuarial assumptions to provide a margin of security; reserve adjustments after rate increases for policies written at earlier and less adequate rates; contingency or catastrophe reserves; and diversification of assets and underwriting risk; and
e. Any other relevant factors, including the National Association of Insurance Commissioners’ reports and independent judgments of the soundness of the prepaid prescription service organization’s financial condition, as evidenced by the rating and reports of reliable professional financial serviceS.
L.2014, C. 81, S.38.
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