Legislation

§ 2329. Motor vehicle insurance rates; excess profits. (a) Each
insurer issuing policies that are subject to article fifty-one of this
chapter, including policies of motor vehicle personal injury liability
insurance or policies of motor vehicle property damage liability
insurance or insurance for loss or damage to a motor vehicle, shall
establish a fair, practicable, and nondiscriminatory plan for crediting
to those purchasing such policies their share of the insurer's excess
profit, if any, on such policies. An excess profit shall be an
underwriting gain for the three most recent calendar years combined
which is greater than the anticipated underwriting profit plus five
percent of earned premiums for those calendar years. Each plan shall
apply to policy periods for the periods January first, nineteen hundred
seventy-four through August second, two thousand one, and the effective
date of the property/casualty insurance availability act through June
thirtieth, two thousand twenty-nine. The superintendent may, through
duly promulgated regulations, waive any requirement for credit that the
superintendent determines to be de minimis or impracticable, adopt forms
of returns that shall be made to the superintendent in order to
establish the amount of any credit due, establish periods and times for
the determination and distribution of credits, and shall provide that
insurers receive appropriate credit against any credits required by any
such plan for policyholder dividends and for return premiums that may be
due under rate credit or retrospective rating plans based on experience.

(b) If an insurer subject to this section distributes a credit
pursuant to this section due to the reforms enacted in the state fiscal
year two thousand twenty-six--two thousand twenty-seven budget, the
insurer shall provide notice to policyholders of this credit and
indicate that the credit was due to the reforms enacted in the state
fiscal year two thousand twenty-six--two thousand twenty-seven budget.
This notification shall be made at the time the credit is distributed.

(c) As used herein with respect to any three-year period, "anticipated
underwriting profit" means the sum of the dollar amounts obtained by
multiplying, for each rate filing of the insurer in effect during such
period, the earned premiums applicable to such rate filing during such
period by the percentage factor included in such rate filing for profit
and contingencies. Separate calculations need not be made for
consecutive rate filings containing the same percentage factor for
profits and contingencies. Underwriting gain or loss for each calendar
year shall be computed as follows: the sum of the incurred losses and
loss adjustment expenses as of March thirty-first of the following year,
developed to an ultimate basis, plus the administrative and selling
expenses incurred in the calendar year, plus policyholder dividends
applicable to the calendar year, will be subtracted from the calendar
year earned premium to determine the underwriting gain or loss.

(d) On or before March thirty-first of each year, an insurer subject
to this section shall submit a report to the superintendent, in a format
specified by the superintendent, demonstrating whether the insurer
realized an excess profit for the three most recent calendar years
combined. Such report shall include all relevant information required to
calculate underwriting gain and loss and determine whether an excess
profit threshold has been realized. If an insurer realized an excess
profit, then the insurer shall notify the superintendent when the
insurer has completed making any credits required by this section. If an
insurer has realized an excess profit, the superintendent shall provide
notice to the speaker of the assembly, the temporary president of the
senate, the chair of the assembly insurance committee, the chair of the
senate insurance committee, and the governor.

(e)(1) Each insurer subject to this section shall, by July first, two
thousand twenty-seven, and annually thereafter, submit a report to the
superintendent that:

(A) identifies and quantifies, in a manner prescribed by the
superintendent, the estimated impact on losses, expenses, and premiums
resulting from statutory or regulatory reforms enacted in or the result
of the state fiscal year two thousand twenty-six--two thousand
twenty-seven budget; and

(B) reflects such estimated impact in the insurer's proposed rates,
rating plans, and rating rules.

(2) In reviewing any rate filing submitted after enactment of the
state fiscal year two thousand twenty-six--two thousand twenty-seven
budget, the superintendent shall consider the estimated impact of the
reforms described in paragraph one of this subsection and shall not
approve any rate that, after such consideration, fails to meet the
standards set forth in section twenty-three hundred three of this
article.

(3) On or before December thirty-first, two thousand twenty-nine, the
superintendent shall submit a report to the governor, the temporary
president of the senate, the speaker of the assembly, the chair of the
assembly insurance committee, and the chair of the senate insurance
committee that:

(A) summarizes the estimated aggregate impact of the reforms described
in paragraph one of this subsection on insurer losses, expenses, and
premiums; and

(B) evaluates the extent to which such savings have been reflected in
approved rates and realized by policyholders.

(4) The superintendent may promulgate regulations or guidance
necessary to implement the provisions of this subsection.