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April 23, 2010

Judge rejects Anthem rate appeal

By The Mainebiz News Staff

A Maine Superior Court judge has upheld Insurance Superintendent Mila Kofman's decision to deny Anthem a rate increase of 18.1%.

Chief Justice Thomas Humphrey affirmed Wednesday Kofman's decision to limit Anthem's average rate increase on individual policies in 2009 to 10.9%, which includes a 0% profit margin, according to a press release from the Attorney General's Office. The ruling said that Maine law does not "expressly entitle insurers to a mandated profit margin," and affirmed Kofman's reasoning that Anthem could rely on surplus from other lines of insurance to cover claims and expenses from individual policies, if necessary.

Anthem had originally sought an 18.1% rate increase beginning July 1, 2009, for about 12,000 individual policyholders, but Kofman approved only a 10.9% hike. The company appealed Kofman's decision, saying it would be forced to take a loss on individual policies. Anthem spokesman Christopher Dugan told the Associated Press the company was reviewing the ruling and had not yet decided whether to appeal.

Earlier this year, Anthem requested a separate 23% rate hike for about 11,000 of its individual policyholders, beginning July 1, 2010. The Bureau of Insurance has not yet made a decision on that request.

Go to the article from the Associated Press >>

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