NAC689B.050. Establishment of program for rating experience.

     1. An insurer may establish an experience rating program which compares the loss experience of an employer’s group to the loss experience of the entire association and which may result in different premiums. An insurer which establishes such a program must establish its classes or class distinctions and schedules for different premiums based upon commonly accepted actuarial principles. Such a program may not result in rates that exceed the standards established in NRS 686B.050 and 686B.060 or are unfairly discriminatory as described in NRS 686A.100.

     2. Upon receiving a request from a customer or the Division, the insurer shall demonstrate, with appropriate statistical evidence, the appropriateness of its classes and class distinctions and the premiums charged.

     3. The premium for an employer’s group may be adjusted, pursuant to an experience rating program, at the time the policy is renewed if:

     (a) The insurer has mailed a notice to the employer’s group at least 60 days before the renewal date, which clearly explains the amount of the increase and the rationale for it; and

     (b) The employer’s group experienced a loss ratio that was at least 150 percent greater than the loss ratio of the association as a whole.

     4. If an employer’s group has its premium increased pursuant to this section, the increase may not be greater than 100 percent of the premium for the entire association. The calculation of this limitation may not include the amount of any increases in premiums which have been applied to the entire association.

     (Added to NAC by Comm’r of Insurance, eff. 10-12-88; A 5-27-92)