1. (1) A competitive market is presumed to exist unless the commissioner, after hearing, issues an order stating that a reasonable degree of competition does not exist in the market. The order may not expire later than 1 year after issuance.

2. (2) In determining whether a reasonable degree of competition exists, the commissioner shall consider the following factors:

   1. (a) the number of insurers actively engaged in providing coverage;
   2. (b) market shares and changes in market shares;
   3. (c) ease of entry into the market;
   4. (d) market concentration among plan No. 2 insurers as measured by the Herfindahl-Hirschman index;
   5. (e) whether long-term profitability for insurers in the market is unreasonably high in relation to the risks being insured;
   6. (f) whether long-term profitability for insurers in the market is reasonable in relation to industries of comparable business risks; and
   7. (g) generally accepted and relevant tests relating to competitive market structure, market performance, and market conduct.
3. (3) The workers' compensation insurance market may not be determined to be noncompetitive if the market concentration of the 50 largest insurers writing workers' compensation insurance under plan No. 2 satisfied the U.S. department of justice merger guidelines for an unconcentrated market.
4. (4) The commissioner's determinations must be made on the basis of findings of fact and conclusions of law.

History: En. Sec. 2, Ch. 186, L. 1995.