Can an insurer use its own territorial definitions?
A. Yes, provided that there is actuarial support for classifying these territories. Insurers also need to make sure that they’ve met the appropriate filing, and in some cases, approval process. Article 5.171 of SB 14 prohibits an insurer from using rating territories that subdivide a county unless the rate for any subdivision within a county is no greater than 15% more than any other rate used by the insurer in any other subdivision of that county. However, the commissioner may adopt rules to allow for larger differences.
