The Louisiana Department of Insur-ance reported that information provided by Commissioner of Insurance Robert Wooley to a joint meeting of the Louisiana Senate and House Insurance Committees shows the positive results of flexible insurance rating, including more than $38 million in savings in the form of rate decreases for consumers.
Flexible rating, or flex band, was approved during the 2003 regular legislative session and became effective Jan. 1, 2004. It applies to all property and casualty lines of insurance. Flex band rating allows insurers to amend rates as many times as necessary in a 12-month period within the -10 percent to +10 percent flex band. The Louisiana Insurance Rating Commission (LIRC) continues to hear rate requests in excess of 10 percent, or those considered to be not actuarially justified by the department.
Commissioner Wooley said the data shows companies are not asking for the maximum 10 percent rate increase under flex band and the filings made are not being automatically “rubber stamped” by the department, as some opponents of the measure feared.
Wooley also said the rate reductions seen under flex band are significant because such large decreases have not been requested in recent years under the LIRC system. In 2002, the LIRC approved $1,973,984 in rate decreases. That number increased to $2,304,474 in 2003.
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