WHO SETS THE PREMIUMS FOR ASSOCIATION COVERAGES?
The law requires that rates (premiums) must be adequate to pay claims and expenses, based upon an independent actuarial analysis of past and prospective losses and expenses performed annually. The Board of Governors submits a filing to the Office of Insurance Regulation. The Office of Insurance Regulation must approve rates or rate changes that are fully supported by the filing. There is no profit factor in Association rates. Rates are, in essence, a function of claims and expenses. Rate changes can only be applied on the renewal date.
