TWIA Posts 2021 Rate Adequacy AnalysisPublished on: July 6, 2021
TWIA’s 2021 Rate Adequacy Analysis indicates that TWIA’s current rates are inadequate by 39 percent for residential coverage and 46 percent for commercial coverage.
TWIA’s Rate Adequacy Analysis consists of several PDF documents and Microsoft Excel spreadsheets. The complete 2021 TWIA Rate Adequacy Analysis can be found here. A summary of the analysis is found in the Rate Adequacy Presentation to the Committee, which is also included with the Rate Adequacy Analysis documents.
- State law requires TWIA to post a rate adequacy analysis on its website 14 days prior to the date of TWIA’s Board of Directors rate filing vote, including for the Board’s annual required rate filing decision.
- The rate adequacy analysis is produced by TWIA’s actuarial staff.
- The analysis represents an estimate of the amount of premium the Association needs to cover its projected expenses (including losses and loss adjusting expenses, operating expenses, debt service and reinsurance costs) for the following year.
- TWIA’s Rate Adequacy Analysis is an estimate based on traditional actuarial techniques, professional judgment and statistical modeling of future weather events. Actual future events will differ from these estimates.
- Previous TWIA Rate Adequacy Analyses can also be found on the Financial & Reports section of TWIA’s website.
The analysis will be reviewed by TWIA’s Actuarial & Underwriting Committee in an upcoming meeting on July 21. In addition to the analysis performed by TWIA’s designated actuary, TWIA staff’s presentation to the Committee will include information on the impact of using assumptions adopted by independent actuarial firm Willis Towers Watson in its report to the Association last year, which may result in a different rate indication. The Committee is expected to discuss the staff’s rate analysis and consider whether to recommend a change in rates to TWIA’s Board of Directors.
The TWIA Board will also consider the analysis, the Committee’s recommendation, and stakeholder feedback in its deliberations and action regarding the Association’s annual required rate filing. That decision will take place at the next meeting of the TWIA Board on August 3, 2021.
Providing Public Comment on the Rate Adequacy Analysis
Stakeholders will be invited to provide public comments about TWIA’s 2021 Rate Adequacy Analysis for consideration by the Committee and Board at their July and August meetings. Information about the meetings and how to provide written and verbal comment will be posted to TWIA’s website.
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