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PARRIS N. GLENDENING, Governor
Ch. 348
[(n)](O) "Association" means the Industry Automobile Insurance Association
created under § 243M.
[(o)](P) "Cash basis accounting" means the records of accounts of the Fund
evidencing all cash receipts and all cash disbursements of the Fund for a particular year.
[(p)](Q) "Statutory basis accounting" means those accounting practices
prescribed or permitted by the Maryland Insurance Commissioner, as reflected in the
Fund's annual statement.
244D.
The following standards apply to the making and use of rates pertaining to all
classes of insurance to which this subtitle is applicable:
(a) (1) Rates may not be:
(i) Excessive or inadequate, as defined under this subtitle; or
(ii) Unfairly discriminatory.
(2) Except as provided in paragraph (4) of this subsection, a rate may not be
held to be excessive unless:
(i) The rate is unreasonably high for the insurance provided; and
(ii) The Commissioner has issued a ruling under § 244-I(c) of this
subtitle that a reasonable degree of competition does not exist in a market to which the
rate is applicable.
(3) A rate may not be held to be inadequate unless;
(i) It is unreasonably low for the insurance provided and continued
use of it would endanger solvency of the insurer; or
(ii) The rate is unreasonably low for the insurance provided and the
use of the rate by the insurer has had or, if continued, will have the effect of destroying
competition or of creating monopoly.
(4) In the case of personal lines property and casualty insurance, a statewide
rate or a rate in a particular jurisdiction or geographic territory may be held by the
Commissioner to be excessive without determining whether a reasonable degree of
competition exists under § 244-I(e)(1) and (2) of this subtitle if the Commissioner
determines that the rate is;
(i) 1. Unreasonably high for the insurance provided; [ and] OR
[(ii)] 2. Not actuarially justified based on commonly accepted
actuarial principles; OR
(II) IN THE CASE OF PRIVATE PASSENGER AUTOMOBILE
INSURANCE ONLY, NOT IN COMPLIANCE WITH SUBSECTION (F) OF THIS SECTION.
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