P&COhiomedium
Under R.C. 3937.02, a rate is 'inadequate' when which of the following best describes the situation?
AAny policyholder requests a lower premium
BThe rate is identical to a rate filed by another insurer in the same market territory for the same coverage classification
The rate is insufficient to sustain projected losses and expenses or tends to substantially lessen competition
DThe rate is lower than the prior year's filed rate
Why this is the answer
R.C. 3937.02 prohibits not only excessive rates but also rates so low they endanger solvency or have the effect of substantially lessening competition. The ODI Director applies this prong to prevent destructive underpricing that could destabilize the market and ultimately harm policyholders, regardless of whether a particular consumer would prefer the lower price.
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