Board delays action on filings by stats firm

Journal Record, The (Oklahoma City), Oct 30, 1998 by Janie Hainey Special to The Journal Record

The State Board for Property and Casualty Rates voted Thursday to delay action on filings by a new statistical organization wishing to operate in Oklahoma in competition with the National Council on Compensation Insurance.

NCCI gathers statistical information on the insurance business and represents insurers offering workers compensation coverage in the state.

The property and casualty board was considering three filings by Insurance Data Resources and IDR Statistical Services for its workers compensation statistical plan and liability and rating manuals. The board licensed IDR last year to do business in Oklahoma and already has approved three of the six filings that are required for IDR to begin operation in the state. Oklahoma City attorney Larry Derryberry, representing NCCI, asked that the board delay consideration of IDR's final three filings. There always has been only one statistical agent licensed to gather data in the state, he said, resulting in decisions on insurance rates are determined by data that is consistent. He said NCCI and other rating bureaus have concerns about the IDR filings that could not be adequately addressed unless the filings were made available to review, which normally is not permitted under Oklahoma law until the property and casualty board makes a final decision on the matter. Derryberry stressed that NCCI's concern was not to discourage competition and that he was not urging the board to disapprove the filings. He said there should be a hearing on the issue, however, to make copies of the filings available to the public and to receive input from interested parties. He said NCCI is concerned that, upon review by the rating bureau, the filings could show that IDR "borrowed liberally" from NCCI what could be proprietary information in developing their statistical system, and that he wants to make sure their materials are the product of their own initiative, rather than information NCCI has spent decades gathering. The most important thing, he said, is ensuring the consistency, reliability and integrity of data. Having multiple statistical agents in the state, he said, could result in confusion among insurers due to differences in data presented by the competing organization. Derryberry said the copyright issue currently is in litigation in Florida and he understands IDR and NCCI are in settlement negotiations. Any settlement that is reached, he said, probably would not be limited to Florida but would apply to other states, as well. Delaying action, Derryberry said, would allow more time for a settlement to be reached in that case. Steve McCaleb, board attorney, said Alabama already has voted to allow IDR to do business in that state but now is having to decide how to deal with data from multiple statistical agents. Peter G. Strauss, regional director for NCCI, said IDR filings were disapproved in Connecticut, Illinois and Maine and that their filings also were disapproved twice in Hawaii before that state agreed to let them in. Justin Whitefield, with the law firm of Derryberry, Quigley, Solomon and Naifeh, representing the American Insurance Association, said AIA does not object to having multiple statistical organizations but must be able to rely on uniform statistical information. He added that Florida's statistical costs have risen by 60 percent since going to multiple statistical agents. The board voted to hold a hearing on the matter before taking any action on the IDR filings. Janie Hainey is a staff reporter for The Journal Record's Oklahoma Business News division.