SECTION 5.5101. Rates for Commercial Multi-peril Policies

(a) This section provides a rate regulatory procedure for commercial multi-peril policies.

(b) The word "rate," when used in this section, means the cost of insurance per exposure unit, whether expressed as a single number or as a prospective loss cost, with an adjustment to account for the treatment of expenses, profit, and individual insurer variation in loss experience, including any application of individual risk variations based on loss or expense considerations.

(c) Rates for commercial multi-peril policies are subject to the rate regulatory provisions of Insurance Code Chapter 2251, concerning Rates, except as provided in subsections (d) and (e) of this section.

(d) For a commercial multi-peril policy described in this section, Lloyd's plans, reciprocals, and interinsurance exchanges must file with TDI a schedule of the amounts to be charged policyholders or applicants and the amounts of any rate changes for all lines of insurance that are included in the commercial multi-peril policy, including commercial property and inland marine lines of insurance. The schedule must include any amount charged, including rates, policy fees, service fees, and other fees that are charged or collected under Insurance Code §550.001, concerning Solicitation or Collection of Certain Payments. Commercial multi-peril policies that contain lines of insurance other than those specified in subsection (e)(1) - (6) of this section are subject to the requirements of subsection (c) of this section.

(e) To receive a reduction in filing requirements under this section, a commercial multi-peril policy filed by a Lloyd's plan, reciprocal, or interinsurance exchange may contain some combination of only the following lines of insurance:

(1) general liability;

(2) commercial property;

(3) commercial casualty, including boiler and machinery, commercial crime, commercial glass, and professional liability, but excluding commercial automobile, fidelity, surety and guaranty bonds, financial guaranty, and workers' compensation;

(4) medical professional liability;

(5) inland marine; and

(6) garage insurance, including all coverages and endorsements included in the Texas Garage Policy, except for those coverages specifically rated on the basis of risk characteristics of the automobile or the person driving.

(f) Nothing in this section may be construed to preclude the exemptions for Lloyd's plans, reciprocals, and interinsurance exchanges in Insurance Code §2251.003, concerning Applicability of Certain Subchapters, from rate filing for commercial property and inland marine lines of insurance, provided these lines are not included in a commercial multi-peril policy.

Source Note: The provisions of this §5.5101 adopted to be effective June 4, 2023, 48 TexReg 2723