INDIANAPOLIS (Oct. 29, 2007) – Kansas could become the ninth state to allow a modernized rating system for personal lines of insurance. A state task force studying rate modernization has issued a recommendation proposed by the National Association of Mutual Insurance Companies (NAMIC) to adopt the National Conference of Insurance Legislators’ Flex-Rating Regulatory Model Act.
“This legislation is vital to improving the insurance regulatory environment in Kansas,” said Joe Thesing, NAMIC’s director-state affairs. “It will ultimately benefit consumers through increased competition and lower rates.”
The Kansas Insurance Department Fee Modernization and Rating Laws Task Force included legislators, consumer representatives, and members of the insurance industry; and was established pursuant to a 2007 state law to study rate modernization for personal insurance lines. As a task force member, Thesing made a motion for the panel to recommend adoption of the legislation to create a 12 percent flex-band for personal lines of insurance.
Under this system, insurers would be allowed to raise or lower rates within a pre-set 12 percent band without seeking approval from state regulators. In other words, once a rate is set, a company can “flex” within 12 points of that rate.
Thesing’s motion was adopted unanimously by the panel. The recommendation for the flex-rating act will be part of a report submitted to the Kansas Legislature for consideration during the 2008 legislative session.
“This legislation speaks to the concerns of badly-needed reforms in the state regulatory system,” Thesing said. “We thank the task force and will work with members of the Legislature to see that this recommendation becomes law.”
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Posted: Monday, October 29, 2007 12:00:00 AM. Modified: Tuesday, October 30, 2007 10:18:57 AM.
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