On January 7, 2023, the Pennsylvania Insurance Department (PID) issued Notice 2023-01 to inform insurers of the increase in the accident surcharge dollar threshold (cap) to $2100, effective July 1, 2023. The previous adjustment to the threshold (cap) was effective July 1, 2022, when the threshold (cap) increased to $1,900.
The notice states that insurers writing private passenger automobile insurance in Pennsylvania may not, by law, penalize their policyholders (for example, apply rate surcharges or otherwise increase premiums) whose aggregate claim cost over a 3-year period does not exceed a certain threshold (cap). The threshold (cap) applies to any person injured or property damaged and is measured in excess of any deductible or self-insured retention.
The PID is requiring each individual insurer and rating organization to file the previously-discussed change for prior approval by April 1, 2023, and specify an effective date of no later than July 1, 2023. Companies are advised to limit their rate/rule filings to the required threshold revision; any unrelated changes, revisions and manual pages should not be included in the filing.
Questions related to the notice may be directed to Shannon Kost, Actuarial Review Division, Insurance Department, 1311 Strawberry Square, Harrisburg, PA 17120, (717) 783-4308, skost@pa.gov.
