NEWS & NOTES
INSIGHTS ON PCRB WORKERS’ COMP DATA, FILING
ACORD 95 MD REVISED
IA&B staff in December attended an annual meeting with the Pennsylvania Compensation Rating Bureau (PCRB), during which the PCRB provided an overview of the data used to support its loss cost filings submitted to the Insurance Department. The PCRB filed an overall average change of -7.88% effective on April 1, 2024. The data analyzed boils down to the interaction between frequency and severity of claims and the resulting trends that emerge. As in prior years, the increases in severity are more than offset by a continuing decline in frequency. Of note: ▲ Most of the year’s change is driven by the fact that the year 2018 is now dropping from the sliding 3-year period analyzed. 2018 was particularly heavy in large losses.
▲ The new law makes EUIM an opt-out coverage for new auto policies. EUIM coverage remains an opt-in for policy renewals. ▲ Companies using their own forms will need to submit their filings by March 1, 2024. ▲ Agencies will need to adjust their processes and signature forms for new business issued on or after July 1, 2024. During the 2023 legislative session, IA&B, alongside the Maryland Insurance Administration, lobbied against the passage of HB 128. We did not fully defeat the measure, but we did secure two amendments that limit its scope:
▲ While the data used is from policy years 2019 to 2021, approximately 1,400 COVID-19 claims totaling $14M were altogether excluded from the calculations to avoid skewing trends with one-time disruptions. Longer-term disruptions caused by the pandemic (such as the increase in hybrid/remote work) are expected but should be naturally embedded and reflected in future rates. The changes will become effective on April 1, 2024. ▲ The employer assessment is slightly reduced.
The ACORD 95 Enhanced Underinsured Motorist (EUIM) form has been revised to account for Maryland House Bill 128, adopted in 2023.
▲ Its applicability to new business only: Policy renewals are unaffected. ▲ Its limited shelf life: The requirement will sunset on June 30, 2029, at which point, barring new legislation, EUIM will revert to being an opt-in coverage. ACORD’s write-up on the revised form: ACORD 95 MD (2024/07) MARYLAND MANDATORY OFFER OF ENHANCED UNDERINSURED MOTORIST (“EUIM”) COVERAGE AND OPTION SELECTION FORM This is a revised form based on new legislation that essentially changes EUIM coverage. EUIM coverage will be subject to an opt out as opposed to an opt in. The form that has been released is a Department form. ACORD has filed this form and received approval. While this is not a new form, we recommend that because of the number of changes, this form should be treated like a new form. This form should be used with each new policy of private passenger motor vehicle insurance issued sold or delivered in Maryland on or after July 1st 2024. (A “redline” is available and can be provided to a member on request.)
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FEBRUARY 2024
