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Property, Casualty, and Surety Filing Information

General Information

The Department of Insurance's web site can be found at www.aldoi.gov.

Important Bulletin: Mandatory Serff submission for all Rate/Rule and Form filings.  Mandatory Serff November 1, 2007

Submissions should include the required filing fee per bulletin dated May 17, 2010. See Fee Schedule. Electronic Funds Transfer (EFT) is required.

All Serff filings must be submitted in Print to PDF format.

IMPORTANT: All filings must clearly outline items being filed or revised. Any items placed within a final manual or form not previously outlined are not considered approved.

Authorization Form - Authorizes the filer, if other than the company, to make the filing on behalf of the company. The Authorization Form must be submitted with each filing in which the company itself is not submitting the filing.

To further expedite the filing process, please submit rate and rule filings separate from form filings.

The Alabama rating statute is contained in Chapter 13 of Title 27 of the Code of Alabama, 1975. The policy and form approval requirements are contained in Chapter 14 of Title 27 of the Code of Alabama, 1975, and both of these chapters can be accessed in the Legislation section at www.legislature.state.al.us .

The information contained herein is provided to assist insurers in submitting and Departmental personnel in reviewing the filings and does not supercede the requirements of Alabama laws and regulations governing the business of insurance. Insurers are required to be aware of and comply with all Alabama laws, regulations, and Departmental Bulletins.

Commercial Rate and Form Requirements

Reference should be made to the general guidelines for property and casualty insurance rate and form filings (Shown as Exhibit A).

Defense expenses ARE ALLOWED to be included within the limits on General Liability policies.

See Alabama Insurance Regulation No. 123 - Rates and Forms Filing Requirements for Property and Casualty Insurance - effective July 1, 2001. (Reminder - Regulation 123 DOES NOT apply to any Personal Lines, Worker's Compensation or Medical Malpractice filings. Any commercial rate increase proposals which result in more than a 10% overall increase in less than 12 months, will not be eligible for the file and use provisions of Regulation 123. There are at least two possible scenarios where this could result in the application of prior approval rather than the file and use provision. One is when the overall increase proposal is for 10% or more and the other is where the proposed increase in combination with an earlier increase results in more than an overall increase of 10% in less than 12 months.)

See Commercial File and Use Certification Form (Must be completed and attached to the top of any filing being submitted under the File and Use System.)

See News Release regarding Terrorism Exclusions. Please submit a completed Expedited Filing Transmittal Document with each Terrorism Risk Insurance Act Filing.

All fire insurance rate filings shall provide at least five years loss experience, including the year proceeding the year in which rates are made or revised. This is in accordance with Section 27-13-27 (4) of the Alabama Insurance Code, 1975.

For all rate filings submitted, both on a prior approval and file and use system, standard actuarial methods should be employed including adjustment of losses for trend and loss development, adjustment of premiums to current level and for trend, historical expense experience, investment income consideration, credibility consideration, etc.

Commercial Property relative to Wind and Hail Deductibles/Exclusions and Hurricane Deductibles - The Alabama DOI will accept reasonable mandatory or optional wind & hail DEDUCTIBLES in all areas of the state. Mandatory or Optional Wind & Hail EXCLUSIONS are acceptable Only in the Beach Pool area where the insured could purchase the coverage back through the Alabama Insurance Underwriting Association. A filed deductible or exclusion must be accompanied by an appropriate credit. The carrier must comply with Alabama Regulation 136.

Personal Lines Submissions

Reference should be made to the general guidelines for property and casualty insurance rate and form filings (Shown as Exhibit A).

All rate submissions of new programs must include a side-by-side comparison exhibit of at least 3 of their competitor's rates.

Personal auto liability policies should adhere to requirements for cancellation outlined in Title 27, Chapter 23, Article 2 of the Code of Alabama, 1975.

Personal Automobile and Motorcycle Coverages - Automobile and motorcycle filings must be submitted for prior approval. Standard actuarial methods should be employed including adjustment of losses for trend and loss development, adjustment for premiums to current level and for trend, historical expense experience, investment income consideration, credibility consideration, etc. Explanation and support should be provided for various relativity revisions, including territorial, driver classification, symbol, model, year, etc.

Residential Property Coverage, Homeowner, etc. - Residential property coverage, homeowner, etc., filings must be submitted for prior approval. Standard actuarial methods should be employed including adjustment of losses for trend and loss development, adjustment for premiums to current level and trend, historical expense experience, investment income consideration, credibility consideration, etc. Explanation and justification should be provided for various relativity changes including, territorial, protection class, policy amount, etc.

Homeowners Filings and the Use of Credit - For Homeowners ratemaking, the expectation is that while credit may be a useful indicator of loss propensity related perils such as fire or liability, it is less predictive of losses related to catastrophe peril, both hurricane and non-hurricane. Any Homeowners rate filing that either introduces a new rating structure or proposes revisions to an existing rating structure that considers credit must provide support quantifying the predictive power of credit in measuring non-catastrophe versus catastrophe loss propensity. The proposed rating structure related to credit should be consistent with this support, varying the impact of credit by rating territory as indicated.

These filings should also provide rating examples that show the impact of credit on beach and seacoast versus inland risks. The examples should develop 6 sample premiums, specifically for a good credit risk policy and a poor credit risk policy in the beach, seacoast in inland. The poor credit risk should be for the poorest credit the company will actually write. These 6 sample premiums should be provided for the current and proposed rates. All policy characteristics for the examples should be the same except for credit, territory and any minimum deductible requirements that vary throughout the state.

Homeowners Filings and Territorial Base Rate Changes - For Homeowners ratemaking, Alabama's non-hurricane catastrophe exposure should be tiered high to low going from the northern part of the state to the southern part. This is evidenced by non-hurricane catastrophe data by territory groupings for major insurers in Alabama, as well as weather data with regard to tornado and other wind events. The non-hurricane catastrophe exposure should be examined and tiered to reflect the expectation of higher non-hurricane catastrophe per amount of insurance in the northern part of the state versus the southern part.

All Homeowners filings proposing territorial base rate changes should provide:

  • Indicated rate level changes by territory 
  • Hurricane catastrophe, non-hurricane catastrophe and non-catastrophe components allocated to territory used to develop the territorial indications.