Insurance Rate and Premium Regulation in Indiana
1. Regulatory Authority
The Indiana Department of Insurance (IDOI) oversees the setting of insurance rates and premiums. Insurers must file proposed rates with the department and receive approval before implementation.
2. Standards for Rate Approval
Rates must be:
- Reasonable and not excessive
- Comparable to similar businesses in other states
- Fair and non-discriminatory
Insurers are prohibited from using age, gender, or race unfairly and must clearly explain how rates are calculated to consumers.
3. Rate Review Process
Indiana’s insurance commission uses a rate review process to:
- Review and approve/deny rate changes
- Conduct market examinations
- Investigate consumer complaints
- Enforce compliance with state laws
4. Limitations on Rate Increases
Insurers must seek state approval for rate increases exceeding a certain percentage, which:
- Varies by insurance type
- May be subject to additional regulatory conditions
5. Broader Regulatory Functions
- Licensing & Admission: Insurers must be state-licensed and recognized as “admitted” or “domestic.”
- Consumer Protection: Departments ensure fair pricing and provide resources and support to the public.
- Insurer Solvency: Ongoing financial monitoring ensures insurers can pay claims.
- Market Conduct Oversight: Ensures fair, non-discriminatory pricing and rate increase reviews.
6. Role of the NAIC
The NAIC supports state regulators by:
- Stabilizing markets during crises
- Promoting competitive, solvent insurers
- Ensuring consumer protection and financial stability