44-7504 Terms, defined. - Nebraska Statutes

44-7504. Terms, defined.For purposes of the Property and Casualty Insurance Rateand Form Act:(1) Advisory organization means any entity, including itsaffiliates or subsidiaries, which (a) has majority ownership or control bytwo or more insurers and assists two or more insurers in activities relatedto ratemaking, the promulgation of policy forms, or related matters or (b)makes the same prospective loss cost or policy form filings on behalf of orto be available for two or more insurers. For purposes of this subdivision,a group of insurers under common ownership or control shall be considereda single insurer. Advisory organization does not include joint reinsurancepools, joint underwriting pools, or insurers engaged in joint underwriting;(2) Classification means the process of grouping insuredswith similar loss or expense characteristics so that differences in lossesand expenses may be recognized;(3) Clientmeans client as defined in section 48-2702;(4) Director means the Director of Insurance;(5) Exempt commercial policyholdermeans an entity to which specific aspects of rate or policy form regulationdo not apply or have been relaxed in accordance with rules and regulationsadopted and promulgated pursuant to section 44-7515;(6) Expense means that portionof a rate attributable to acquisition, field supervision, collection expense,general expense, taxes, licenses, and fees. Expense does not include lossadjustment expense;(7) Experience rating planmeans a rating formula and related procedures that use past loss experienceof an individual policyholder to forecast future losses by measuring the policyholder'sloss experience against the expected losses for policyholders in that classificationto produce a prospective premium credit, debit, or unity modification;(8) Joint reinsurance poolmeans an ongoing voluntary arrangement pursuant to which two or more insurersparticipate in the reinsurance of risks written by one or more member insurersand reinsured by one or more other member insurers. For purposes of this subdivision,a group of insurers under common ownership or control shall be considereda single insurer. A joint reinsurance pool may operate through an association,syndicate, or other arrangement;(9) Joint underwriting meansa voluntary arrangement established on an individual risk basis by which twoor more insurers jointly contract to provide coverage for an insured. Forpurposes of this subdivision, a group of insurers under common ownership orcontrol shall be considered a single insurer. Joint underwriting does notinclude any arrangement by which the participants are reinsuring the directobligation of another risk-assuming entity;(10) Joint underwriting poolmeans an ongoing voluntary arrangement pursuant to which two or more insurersparticipate in the sharing of risks written as their direct obligations accordingto a predetermined basis and the insurance remains the direct obligation ofthe pool participants. For purposes of this subdivision, a group of insurersunder common ownership or control shall be considered a single insurer. Ajoint underwriting pool may operate through an association, syndicate, orother arrangement;(11) Loss adjustment expensemeans the expense incurred by an insurer in the course of settling claims;(12) Masterpolicy means master policy as defined in section 48-2702;(13) Multiplecoordinated policy means multiple coordinated policy as defined in section 48-2702;(14) Policy form means allpolicies, certificates, or other contracts providing insurance coverage. Policyform includes bonds and includes riders, endorsements, or other amendmentsto the policy form;(15) Premium means the costof insurance to the policyholder after all audit adjustments have been madeand any dividends payable have been subtracted;(16) Professionalemployer organization means professional employer organization as definedin section 48-2702;(17) Prospectiveloss cost means that portion of a rate intended to provide for expected lossesand loss adjustment expenses. Prospective loss costs may provide for anticipatedspecial assessments. Prospective loss costs do not include provisions forprofits, dividends, or expenses other than loss adjustment expenses;(18) Rating system means theinformation needed to determine the applicable rate or premium including rates,any manual or plan of rates, classifications, rating schedules, minimum premiums,policy fees, payment plans, rating plans or rules, anniversary rating daterules, and other similar information. Rating system does not include dividendrating plans or other provisions for the possible payment of dividends ifsuch dividends are declared by the insurer's board of directors and are notguaranteed;(19) Special assessments meansguaranty fund assessments made pursuant to section 44-2407, Workers' CompensationTrust Fund assessments made pursuant to section 48-162.02, residual marketassessments made pursuant to section 44-3,158 or 44-7528, and similar assessments.Special assessments are not expenses or losses;(20) Statistical agent meansan entity that, for the purpose of fulfilling the statistical reporting obligationsof two or more insurers under the act, collects or compiles statistics fromtwo or more insurers or provides reports developed from these statistics tothe director. For purposes of this subdivision, a group of insurers undercommon ownership or control shall be considered a single insurer; and(21) Supporting informationmeans the experience and judgment of the filer and the experience or dataof other insurers or advisory organizations relied upon by the filer, theinterpretation of any other data relied upon by the filer, descriptions ofmethods used in developing a rating system, and any other information requiredby the director to be filed. SourceLaws 2000, LB 1119, § 4; Laws 2001, LB 4, § 1; Laws 2007, LB117, § 25; Laws 2010, LB579, § 12.