Degrees of Rate Regulation for other LOBs
I'm looking to add to my notes for how highly other lines not mentioned in the source or BattleActs are regulated. Would I be on the right track in assuming that:
- Other highly regulated lines would include: Med. Mal., flood, and disability
- Other medium regulation lines would include: APD, commercial property, renters, UBI, and umbrella
- Other low regulation lines would include: B&M, Products liability, warranty/long duration/guaranty, EPL, and D&O
Comments
It's good to extend your thinking beyond what's been specifically asked before!
What were your reasons for putting these coverages in these categories? The reason I ask is that without having specific knowledge each type of insurance, you can often argue successfully for either low or high scrutiny. As far as the exam goes, I think if you show that you know the reasons for low scrutiny and the reasons for high scrutiny and relate them to the question in a half-way intelligent way then you would get credit.
But let's take a look at MEDICAL MALPRACTICE. I think you're right that this should be high scrutiny because:
Now, FLOOD insurance is handled largely by NFIP (National Flood Insurance Program) so almost by definition it's highly regulated since it's run by the government. If you look at the various reasons however for low & high scrutiny in the wiki, it's not quite so clear:
For your low-scrutiny coverages, like B&M and D&O, I think you're probably right, especially D&O.
About the risks you put in the middle: APD, renters, UBI, etc. They could probably be argued either way if they don't clearly fall into high or low scrutiny. APD would come under auto, but of course it's mainly liability that auto regulators are concerned with.
So, final takeaway is to learn the standard reasons for low and high scrutiny. Then you can mix & match them for the specific coverage you're asked in the exam question. And of course make sure you know the answers to past exam questions in case they repeat a question. And note that this is a relatively low-ranked syllabus reading. Keep that in mind when you're scheduling your review!
Very helpful, Graham!
Is UBI in current syllabus? for Spring 2024 sitting
UBI is "usage-based insurance." Usually Auto.
It is not on the syllabus any longer.