If you buy health insurance on the individual market, without help from an employer, you may want to know what Tennessee is doing to protect you from unfair and unnecessary premium rate increases. Here’s a summary of the Tennessee laws that govern rate increases.

  • Tennessee requires insurers and HMOs to file rates, and the state has “prior approval” authority to approve or reject the rates before they go into effect.
  • Unless HMO rates are “excessive, inadequate or unfairly discriminatory,” the Insurance Commissioner must approve them “within a reasonable period.” It is unlawful for an HMO to use rates until they have been approved. Tenn. Code Ann. § 56-32-107.
  • Rates for nonprofit insurance and “accident and sickness” insurance will be approved if “the benefits provided in the policy are reasonable in relation to the premium charged.” This standard is deemed met if the insurer complies with the terms of the loss ratio guarantees accompanying the filing. If these loss ratio guarantees are not met, policyholders are entitled to a proportional refund. Tenn. Code Ann. § 56-26-102; Tenn. Comp. R. & Regs. R. 0780-1-20-.02; Tenn. Code Ann. § 56-1-212.
  • Rates for nonprofit insurance and “accident and sickness” insurance may be used if not disapproved 30 days after filing, unless the Insurance Commissioner approves the rates sooner. Tenn. Code Ann. § 56-26-102; Tenn. Code Ann. § 56-1-212.