Section

1. Authority and Purpose

2. Scope

3. Definitions

4. Computing the Consumer Complaint Ratio

5. Computing the Consumer Complaint Index

6. Supplementary Reporting of Direct Written Premiums

7. Effective Date

§ 1. Authority and Purpose

This Rule is adopted by the Superintendent pursuant to Title 24-A M.R.S.A. §§ 212 and 216(2), to define the method for calculating consumer complaint ratios.

§ 2. Scope

This Rule applies to all insurers holding certificates of authority to issue insurance policies or annuity contracts within the state of Maine, except that this rule does not apply to reinsurance, surplus lines insurance, or to complaints under the jurisdiction of the Workers' Compensation Board.

§ 3. Definitions

The following words and phrases, when used in this Rule, shall have the following meanings:

A. "Beneficiary" means any individual legally entitled to proceeds or benefits under a policy of insurance. B. "Bureau" means the Bureau of Insurance. C. "Consumer Complaint" means a written communication from an insurance

consumer primarily expressing a grievance that results in the need for the Bureau to conduct further investigation or to communicate in writing with a regulated entity for a response or resolution to the complaint.

1. D. 'Consumer Complaint Ratio' means the ratio of the number of consumer complaints to the direct written premiums for a line of insurance or combined lines of insurance.
2. E. 'Consumer Complaint Index' means the ratio of an insurer's consumer complaint share to its market share for a line of insurance or combined lines of insurance.
3. F. 'Consumer Complaint Share' means the percentage of consumer complaints received by the Bureau against an insurer for any given line of insurance, compared to the total consumer complaints received by the Bureau for that line of insurance.
4. G. 'Direct Written Premium' means consideration paid, or to be paid, to the insurer for the issuance and delivery or renewal of any binder, policy of insurance or certificate of insurance or annuity written.
5. H. 'Consumer' means:
6. 1. A policyholder, certificateholder, or beneficiary under an insurance policy or annuity contract; or
7. 1. An applicant for insurance.
8. I. 'Insurer' means any company, association, organization, partnership, syndicate, business trust, corporation or legal entity engaged as an indemnitor or surety, holding a certificate of authority issued by the Superintendent, including a nonprofit service organization or health maintenance organization. For purposes of this Rule, a group of affiliated companies under common management and control may be considered a single 'insurer.'
9. J. 'Lines of Insurance' means the classifications or subclassifications of kinds of insurance which are required to be reported annually on the Annual Statement, or on supplementary report forms required by the Superintendent pursuant to Section 6.
10. K. 'Market Share' means an insurer's direct written premiums for a line of insurance, expressed as a percentage of the total direct written premiums in the State of Maine for that line of insurance.
11. L. 'Reporting Period' means one or more calendar years. The number of years used will be determined based on a sufficient volume of consumer complaints to

produce statistically valid ratios and indices.

§ 4. Computing the Consumer Complaint Ratio

A. Direct written premiums in Maine for the reporting period will be subdivided by line of insurance for each insurer. B. Consumer complaint information for the reporting period will be subdivided by line of insurance for each insurer. C. The insurer's consumer complaint ratio for a line of insurance will be calculated by dividing the number of consumer complaints by the direct written premiums for that line of insurance. D. Only those insurers with sufficient premium volume to produce credible consumer complaint ratios will be included.

§ 5. Computing the Consumer Complaint Index

A. All direct written premiums in Maine for the reporting period will be compared to determine the market share of insurance business for each insurer by line of insurance. B. Consumer complaint information will be subdivided by line of insurance for each insurer. C. The consumer complaint share will be determined for each insurer by line of insurance based on consumer complaints received by the Bureau. D. An insurer complaint index, for each insurer, will be calculated by dividing the consumer complaint share by line of insurance by the market share of direct written premium for that line of insurance.

§ 6. Supplementary Reporting of Direct Written Premiums

A. If the Superintendent determines that the lines of health insurance enumerated in the Annual Statement are insufficiently specific, the Superintendent may require insurers to itemize their premium writings in accordance with supplemental reporting forms prescribed by the Superintendent. Requirements for such information will be imposed on a prospective basis only. B. The Superintendent may consolidate lines of insurance into a single category, either in addition to or instead of the individual lines, and each category shall be

treated as a single “line of insurance” for purposes of this Rule.

§ 7. Effective Date

The effective date of this Rule is June 21, 1998. Amendments to this rule are effective May 4, 2002.

STATUTORY AUTHORITY: 24-A M.R.S.A. §§ 212 and 216(2)

EFFECTIVE DATE:

June 21, 1998