SB502 Summary

• Modifies Arkansas Code § 23-63-1303(d) to clarify that maintaining reasonable excess capital above risk-based capital (RBC) requirements is desirable and helps insurers manage various business risks.

• Amends § 23-63-1309 to change the prohibition on use of RBC information in ratemaking, allowing the Insurance Commissioner to consider RBC data in rate proceedings for non-health insurers and permitting health insurers to use RBC information in ratemaking determinations.

• Creates new Subchapter 20 (§ 23-63-2001 through 23-63-2003) establishing maximum surplus level requirements for health insurers, including a 650% risk-based capital ratio threshold above which health insurers must restrict rate increases, copayment increases, and reimbursement reductions for one year.

• Requires health insurers to calculate and report their risk-based capital ratio annually by March 1, with calculations as of December 31 of the prior year.

• Directs the Insurance Commissioner to consider RBC metrics when making ratemaking determinations for health plans.