Prohibited Activity by
Insurers and Rating Organizations
(a) No Insurer or Rating Organization shall
monopolize or attempt to monopolize, or combine or conspire with any other
person or persons to monopolize, in any territory, the business of private
passenger motor vehicle insurance or any kind, subdivision or class
(b) No Insurer or Rating
Organization shall agree with any other Insurer or Rating Organization to
charge or adhere to any Rate, prospective loss cost, rating plan, rating
schedule, rating rule, policy or bond form, rate Classification Plan, rate
territory, underwriting rule, survey, inspection or similar material, except as
needed to exchange Statistical Information as authorized by the Commissioner.
In addition, a Rating Organization may establish advisory manuals of
Classification Plans, rules and Rates, rating plans or modifications of any of
the foregoing in any manner not prohibited by the Commissioner.
No Insurer or Rating Organization shall
make any agreement with any other Insurer, Rating Organization or other person
1.Restrains trade; or
2.Substantially lessens competition in any
territory or in any kind, subdivision or class of insurance.
(d) No Insurer may acquire or
retain any capital stock or assets of, or have any common management with, any
other Insurer or Insurers, if the effect of such acquisition, retention or
common management may be to substantially lessen competition in any territory
or in any kind, subdivision or class of insurance.
(e) No Insurer or Rating Organization shall
make any agreement with any other Insurer or Rating Organization to refuse to
deal with any person in connection with the sale of insurance.
(f) No Rating Organization or member or
subscriber thereof shall interfere with the right of any Insurer to make its
Rates independently of such Rating Organization or to charge Rates different
from the Rates filed by such Rating Organization.
(g) No member of or subscriber to a Rating
Organization shall refuse to do business with, or prohibit or prevent the
payment of commission to any licensed insurance producer on the ground that
such insurance producer does business with an Insurer which files its Rates, or
any portion thereof, independently of such Rating Organizations.
211 CMR 79.00
construed as requiring any Insurer to become a member of or a subscriber to any
Rating Organization, or as preventing any Insurer, while a member of or
subscriber to a Rating Organization, from making its own Rates for any kind,
subdivision or class of insurance, for which it does not elect to authorize the
Rating Organization to act on its behalf.
(i) Any Insurer which is a member of or
subscriber to a Rating Organization may make its own Rates for any kind,
subdivision or class of insurance. No Rating Organization shall have authority
to act on behalf of any Insurer which is a member of or subscriber to such
Rating Organization except as authorized in writing by such member or
subscriber, which authority may be supplemented, modified or revoked, in whole
or in part, at any time by such member or subscriber at its option.
(j) No Rating Organization shall have or
adopt any rule or execute any agreement, or formulate or engage in any program,
the effect of which would be to require any member, subscriber or other Insurer
to utilize some or all of its services, or to adhere to its Rates, rating
plans, rating systems, underwriting rules, or policy forms, or to prevent any
Insurer from acting independently.
Notwithstanding 211 CMR 79.08
(6)(a), in a
Competitive Market no Rating Organization shall prepare or file an Advisory
Filing for any motor vehicle coverage subject to M.G.L. c. 175E, that includes
a coverage level rate that is based on the total loss experience of all
Penalties and Actions
. The Commissioner shall
disapprove any Rate or Advisory Filing that does not comply with M.G.L. c.
175E, § 6 or 211 CMR 79.08
(1), and shall seek appropriate injunctive
relief and penalties in order to enforce strictly the provisions of M.G.L. c.
175E, § 6 and 211 CMR 79.08
. The provisions of 211 CMR 79.08
(1) shall not be
construed to prohibit two or more Insurers in an Insurance Company Group, from
having the right to exchange Statistical Information.
(4) The fact that two or more Insurers,
whether or not members or subscribers of a Rating Organization, use, either
consistently or intermittently, the manuals of Classification Plans, rules and
Rates, rating plans, modifications of any of the foregoing or recommendations
of such organizations, shall not be sufficient in itself to support a finding
that an agreement to adhere exists, and may be used only for the purpose of
supplementing or explaining direct evidence of the existence of any such
M.G.L. c. 175A, M.G.L. c. 175E, § 6 and any other provision of 211 CMR
, a Rating Organization, with the participation of its members, may:
(a) Develop and make recommendations to the
Commissioner with respect to statistical plans.
(b) Collect, compile and distribute
Statistical Information to its members and subscribers, provided such
information shall be supplied upon request to the Division and may be supplied,
upon payment of a reasonable charge therefore, to any Insurer or other person,
whether or not a member or subscriber of the Rating Organization.
(c) Prepare, distribute and file Rating
Manuals on behalf of any member or subscriber that authorizes it to make such a
filing in accordance with M.G.L. c. 175E, § 6(a)(10).
(d) Prepare, distribute and file policy forms
and endorsements on behalf of any member or subscriber that authorizes it to
make such a filing in accordance with M.G.L. c. 175E, §
(e) Conduct and publish
studies of general actuarial and rate making issues, provided such studies
shall be supplied, upon request, to the Division and, upon payment of a
reasonable charge therefore, to any Insurer or other person, whether or not a
member or subscriber of the Rating Organization.
(f) Perform any other actions in connection
with motor vehicle insurance Rates which are not inconsistent with M.G.L. c.
Notwithstanding M.G.L. c. 175A, M.G.L. c. 175E, § 6 and any other
provision of 211 CMR 79.08
, a Rating Organization, without the participation of
its members, may:
(a) Prepare and file an
Advisory Filing for any motor vehicle coverage subject to M.G.L. c. 175E, based
exclusively on the collective loss and exposure experience of the Under
One-percent Companies for the purpose of establishing average coverage level
rates; provided, however, that such an Advisory Filing may include the
experience of all companies for the purpose of establishing rate relativities
and factors supporting the Classification Plan.
(b) Prepare and file a Rate Filing on behalf
of CAR if CAR authorizes it to make such a filing.
Prepare and file a Rate Filing on behalf
of an Under One-percent Company, as determined under M.G.L. c. 175E, §
211 CMR 79.00
, and which
authorizes it to make such a filing in accordance with M.G.L. c. 175E, §
(d) If an Under
One-percent Company has Expenses, including commissions, prior to trending,
which are 80% or less than those underlying the Advisory Filing made by a
Rating Organization on behalf of such Companies or the Rate Filing of another
Insurer which is adopted by such Insurer, the Under One-percent Company shall
not adopt that external Advisory Filing without deviating therefrom so as to
reflect its lower Expenses, unless specific and substantial reasons for not so
deviating have been provided to and approved by the Commissioner.