N.Y. Comp. Codes R. & Regs. tit. 11 § 152.3
Chargeable losses paid in the 10-year review period and disciplinary actions imposed in the five-year period prior to the latest policy effective date shall be included for evaluation purposes. If, for any claim, the length of time between the occurrence and settlement dates is more than 10 years, then such claim can no longer be, or become, a chargeable loss even though settlement occurs in the 10-year review period. Physicians licensed to practice for less than 10 years shall be rated only on their years of practice. In issuing new and renewal policies for the period beginning July 1, 1986, insurers shall use the full 10-year experience period (or less, for physicians licensed less than 10 years). Upon request, physicians, insurers and managers of insurance programs shall furnish to current insurers claims and disciplinary information necessary to calculate an accurate surcharge. Existing insurers shall request and obtain this information.
The following surcharges shall apply where there has been:
For each chargeable loss, one point shall be assigned. These "points" generate surcharges according to the following schedule of percentages, which is based on the specialty classifications currently filed by the Medical Malpractice Insurance Association. In this schedule, downstate refers to the following New York State counties: Nassau, Suffolk, Bronx, Kings, Queens, Richmond, Rockland, Sullivan, New York, Orange and Westchester; upstate refers to all other New York State counties. (Note: These factors will be adjusted periodically as more experience data becomes available):
| Surcharge points | 1 | 2 | 3 | 4 | 5 | 6 | 7 or more |
| 1-7 (Downstate) | 0 | 0 | 10% | 35% | 80% | 130% | 200% |
| 8-16 (Downstate) | 0 | 10% | 35% | 70% | 110% | 150% | 200% |
| 1-7 (Upstate) | 0 | 10% | 35% | 70% | 110% | 150% | 200% |
| 8-16 (Upstate) | 5% | 15% | 45% | 85% | 120% | 160% | 200% |
Surcharges are developed by determining the chargeable losses paid within the evaluation period, adding the number of points for each loss, and multiplying the otherwise applicable premium by 100 percent plus the surcharge. For example, if a physician's base rate for his class and territory is $50,000, and he has accumulated seven surcharge points, his premium is:
200% (surcharge) + 100% (base) = 300%
300% of $50,000 = $150,000
Surcharges for disciplinary actions are added to any surcharges generated by chargeable losses. For example, if an upstate Class 10 physician's base rate for his class and territory is $10,000, and he has accumulated two surcharge points and has had probation invoked in any state, his premium is:
15% (for two points) + 50% (for probation) + 100% (base) = 165%
165% of $10,000 = $16,500
In no event shall the total surcharge from both chargeable losses and disciplinary actions exceed 200 percent.
Insurers who insure physicians in the first year of practice, or physicians in part-time practice (e.g., semi-retired or in full-time teaching) must file an appropriate rate credit. Other credits may be filed with the superintendent for approval pursuant to section 2305 (b) of the Insurance Law. Such credits must be adequately supported and comply with section 2303 of the Insurance Law. Any surcharge or credit generated by other provisions of this regulation will apply to the reduced premium.
Insurers shall establish and file for approval a mechanism for physicians to:
Surcharge "points" shall be waived or reduced by insurers if circumstances indicate that they are not truly predictive of future claims. While the surcharge is being appealed, the insured must pay the applicable rate for his class and territory including all surcharges (whether or not they are being appealed).
Surcharges must be returned if:
If a physician is reclassified from a higher-rated to a lower-rated specialty, points assigned for incidents which were not related to the practice of the lower-rated specialty shall not be used for merit rating purposes.
When a policy has been surcharged under a merit rating plan, insurers are directed to state prominently, either on the declarations page or the premium bill, or on a notice attached to the declarations page or premium bill, the following, or its substantive equivalent:
"Your premium rates are higher than they otherwise would be because, during the measuring experience period that applied to your insurance, you had the following chargeable losses or disciplinary actions under our merit rating plan. This plan has been filed with and approved by the New York State Department of Financial Services pursuant to Regulation No. 124 of the department. The attached description of our merit rating plan includes a list of events for which we may surcharge you, the circumstances under which surcharges may be removed and refunded, and the procedure you should follow if you wish to appeal this surcharge. We trust this will answer any questions you have concerning your surcharge. If you have any further questions, you may call us at."
N.Y. Comp. Codes R. & Regs. Tit. 11 § 152.3