45-06-15-09. Loss ratio.

Benefits under short-term care insurance policies must be deemed reasonable in relation to premiums provided the expected loss ratio is at least seventy percent, calculated in a manner which provides for adequate reserving of the insurance risk. In evaluating the expected loss ratio, due consideration must be given to all relevant factors, including:

1. Statistical credibility of incurred claims experience and earned premiums;

2. The period for which rates are computed to provide coverage;

3. Experienced and projected trends;

4. Concentration of experience within early policy duration;

5. Expected claim fluctuation;

6. Experience refunds, adjustments, or dividends;

7. Renewability features;

8. All appropriate expense factors;

9. Interest;

10. Policy reserves;

11. Mix of business by risk classification; and

12. Product features such as elimination periods, deductibles, and maximum limits.