Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, August 10, 1994 TAG: 9409020019
SECTION: BUSINESS PAGE: B8 EDITION: METRO
SOURCE:
DATELINE: RICHMOND LENGTH: Short
Acting on a recommendation from its Bureau of Insurance, the commission last week cut rates of credit life insurance 13.75 percent. It also cut rates for a variety of credit accident and sickness insurance about 12 percent.
The aim is to set rates low enough to assure that at least 60 cents of every premium dollar collected goes to pay claims. The latest cut is the second set in motion by a 1992 regulatory crackdown on credit insurance.
The 60-cent loss ratio is a standard recommended by the National Association of Insurance Commissioners and is designed to make sure credit insurance rates do not become unreasonably high, said state Insurance Commissioner Steven T. Foster.
Foster launched the crackdown on credit insurance after members of his staff found some insurers were paying as little as 15 cents of every premium dollar on claims.
Last month, officials from credit insurance companies and their trade associations asked the SCC to consider a new way of regulating rates, saying the system the state used would not assure them adequate earnings.
-Associated Press
by CNB