OAR 836-150-0050: Reinsurance Payments

(1) The department will calculate the total reinsurance payment owed to each reinsurance eligible issuer. (a) Subject to paragraph (b) and (c) of this rule, the reinsurance payment made to each reinsurance eligible issuer for a benefit year will be the product of the coinsurance rate and the portion of the reinsurance eligible issuer’s total reinsurance eligible claims for the benefit year that fall between the attachment point and the reinsurance cap. (b) If the total reinsurance payments calculated under paragraph (a) of this rule would exceed the total dollar amount budgeted for the reinsurance program in a benefit year, the department may uniformly reduce the coinsurance rate for all reinsurance eligible issuers in that benefit year. If the department elects to reduce the coinsurance rate under this paragraph, the department will reduce the coinsurance rate only to the extent necessary to ensure that reinsurance payments do not exceed the total dollar amount budgeted for the benefit year. (c) In making the calculation under paragraph (a), the department may disregard any or all reinsurance eligible claims reported by a reinsurance eligible issuer under OAR 836-150-0030 that cannot be verified as part of the audit described under OAR 836-150-0060(1). (2) The department will issue reinsurance payments to all reinsurance eligible issuers on an annual basis in the year following each benefit year. (3) Payments will be made directly to reinsurance eligible issuers by a method selected by the department.