31A-19a-201. Rate standards.
(1) Rates may not be excessive, inadequate, or unfairly discriminatory.
(2) Rates are not excessive if a reasonable degree of price competition exists at the consumer level with respect to the class of business to which they apply. In determining whether a reasonable degree of price competition exists, the commissioner shall consider: relevant tests of workable competition pertaining to: market structure; market performance; and market conduct; and the practical opportunities available to consumers in the market to: acquire pricing and other consumer information; and compare and obtain insurance from competing insurers. The tests described in Subsectioninclude: (2)(a) the size and number of insurers actively engaged in the market and class of business; the market shares of insurers actively engaged in the market and changes in market shares; the existence of rate differentials in that class of business; ease of entry and latent competition of insurers capable of easy entry; availability of consumer information concerning the product and sales outlets or other sales mechanisms; and efforts of insurers to provide consumer information. If reasonable price competition does not exist, rates are excessive if: rates are likely to produce a long-term profit that is unreasonably high in relation to the riskiness of the class of business; or expenses are unreasonably high in relation to the services rendered.
(3) Rates are inadequate if: they are clearly insufficient, when combined with the investment income attributable to them, to sustain the projected losses and expenses in the class of business to which they apply; and the use of such rates has or, if continued, will have: the effect of substantially lessening competition; or the tendency to create a monopoly in any market.
(4) A rate is unfairly discriminatory if price differentials fail to equitably reflect the differences in expected losses and expenses after allowing for practical limitations. A rate is not unfairly discriminatory if it is averaged broadly among persons insured under a: group, franchise, or blanket policy; or mass marketed plan.