South Carolina General Assembly
115th Session, 2003-2004

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Bill 891

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Indicates New Matter

(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)

Indicates Matter Stricken

Indicates New Matter

COMMITTEE REPORT

February 25, 2004

S. 891

Introduced by Senator Richardson

S. Printed 2/25/04--S.

Read the first time February 3, 2004.

            

THE COMMITTEE ON BANKING AND INSURANCE

To whom was referred a Bill (S. 891) to amend Section 38-73-430, Code of Laws of South Carolina, 1976, relating to the making of rates for casualty insurance, so as to add, etc., respectfully

REPORT:

That they have duly and carefully considered the same and recommend that the same do pass:

DAVID L. THOMAS for Committee.

            

STATEMENT OF ESTIMATED FISCAL IMPACT

ESTIMATED FISCAL IMPACT ON GENERAL FUND EXPENDITURES:

$0 (No additional expenditures or savings are expected)

ESTIMATED FISCAL IMPACT ON FEDERAL & OTHER FUND EXPENDITURES:

$0 (No additional expenditures or savings are expected)

EXPLANATION OF IMPACT:

The Department of Insurance states that this bill would have no impact on the General Fund of the State or on federal and/or other funds, as it merely adds an additional criterion to the section and clarifies what constitutes a rate increase.

Approved By:

Don Addy

Office of State Budget

A BILL

TO AMEND SECTION 38-73-430, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE MAKING OF RATES FOR CASUALTY INSURANCE, SO AS TO ADD TO THE CRITERIA THAT CONSIDERATION MUST BE GIVEN TO ASSESSMENTS, SUCH AS THE GUARANTY FUND, WIND AND HAIL JOINT UNDERWRITING ASSOCIATION, AND SIMILAR MECHANISMS WHEN MAKING THE RATES; AND TO AMEND SECTION 38-73-920, RELATING TO THE REQUIREMENT THAT THE INSURER MAY MAKE OR ISSUE A CONTRACT OR POLICY ONLY ON RATES WHICH ARE IN EFFECT, SO AS TO PROVIDE THAT PROPOSED RATES CHANGES WHERE THE SOLE FACTOR FOR THE CHANGE IS THE IMPACT OF A REVISED ASSESSMENT DOES NOT CONSTITUTE A RATE INCREASE FOR PURPOSES OF THIS SECTION.

Be it enacted by the General Assembly of the State of South Carolina:

SECTION    1.    The first paragraph of Section 38-73-430 of the 1976 Code is amended by adding at the end:

"(5)    Due consideration must be given to assessments for purposes such as the guaranty fund, wind and hail joint underwriting association, and similar mechanisms."

SECTION    2.    The first paragraph of Section 38-73-920 of the 1976 Code is amended to read:

"No An insurer may not make or issue a contract or policy except in accordance with the filings which are in effect for the insurer as provided in this chapter or in accordance with Section 38-73-1060. Notwithstanding Section 38-73-10, item (2) of Section 38-73-330, and item (4) of Section 38-73-430, filings for property and casualty rate increases may not be approved for any insurer or rating organization for any line, sub-line, or otherwise identifiable property and casualty insurance coverage for which a rate increase has previously been granted within the immediately preceding twelve months. However, if satisfactory evidence is presented to the director or his designee by an insurer or rating organization that the continued use of the previously approved rates for the line, sub-line, or otherwise identifiable property and casualty insurance coverage may result in the insolvency of an insurer, more frequent rate increases may be approved. Rate changes proposed where the sole factor for the change is the impact of a revised assessment does not constitute a rate increase for purposes of this section. This section does not apply to contracts or policies for inland marine risks as to which filings are not required."

SECTION    3.    This act takes effect upon approval by the Governor.

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