For Consumers

Requirements for insurers premium change transparency rule

Insurers must explain premium increases for auto and homeowner policies in Washington under new transparency rules WAC 284-30A. The rules go into effect in two phases beginning June 1, 2024.

Types of policies impacted

The affected insurance policies are:  

  • Private passenger auto policies (this does not include policies that cover boats, motorcycles, off-road vehicles, recreational vehicles, antique or collector vehicles, classic vehicles, and specialty vehicles) (WAC 284-30A-020(2)(a), (4)(a)); and  
  • Homeowner’s policies (including mobile and manufactured homeowners, condominium owners and renter's coverage) (WAC 284-30A-020(2)(b))

The new rules do not apply to surplus lines, commercial auto policies, health plans, life, disability, and long-term care policies, and personal umbrella policies. (WAC 284-30A-020(4)(b, f))

Phase 1 - June 1, 2024

Premium increase notices

Insurers are required to inform policyholders that they can request more details about their premium increase by contacting their insurer. (WAC 284-30A050(2), (5)). Disclaimer requirements include: 

  • Located on the first page or view of renewal notices and renewal billing statements. 
  • Bold font with a minimum size of 12 points.
  • Statement with similar language - "Policyholders receiving an increase to their premiums at renewal can request an explanation by contacting their insurer in writing. Please see Chapter 284-30A WAC for additional information on your right to an explanation for your rate increase." (WAC 284-30A-050(1)).  
  • Insurer contact information.

Explanation of premium increases 

Insurers must provide a reasonable explanation for premium increases when policyholders request, in writing, information about a premium increase that occurred at renewal. (WAC 284-30A) Reasonable explanation requirements include:

Insurers are not required to but may  include the policyholder’s producer’s contact information in all premium change notices and explanations. (WAC 284-30A050(2))

Phase 2 - June 1, 2027

Notices and explanations to consumers 

Insurers must provide notice of premium changes at least 20 days before renewing a policy with a 10% or greater increase. (WAC 284-30A-050(4)(b)). They must also provide notice within 20 days of a written request from the policyholder (WAC 284-30A-050(4)(a))

Insurers are required to give policyholders clear explanations for any premium increases and include the primary factors that caused the increase in premium change notices, as mandated by WAC 284-30A-040(2).

The primary factors must always be included in premium change notices when applicable:

  • Car garaging location, driving record, miles driven, number of drivers, number of vehicles, claims history, discounts, fees and surcharges, age, credit history, education, gender, marital status, occupation, property age, property location, property value, premium capping, and rate changes (including that subject to rate stability rules, transition rules, or premium-capping rules). (WAC 284-30A-070(2)(a)).

Premium change notice templates

The OIC has provided a standard premium change notice template for insurers to use, but they may also create their own version if it meets the requirements described in (WAC 284-30A-060(1))

Filing requirements

Insurers must file their premium change notice forms with the OIC starting January 1, 2027, through the System for Electronic Rate and Form Filings (SERFF). (WAC 284-30A-060(3))

Requirements for both Phase 1 and 2

  • A policyholder can request more information after a premium increase explanation. Insurers must respond within 20 calendar days. (WAC 284-30A-050(6))
  • Insurers can include estimated amounts in the notices if they also explain the accuracy of the estimate for the policy and premium increase. (WAC 284-30A-070(4))
  • Insurers can use composite rating factors but must specify the premium increase caused by them. (WAC 284-30A-070(3))
  • Insurers can choose to provide an explanation for the entire premium increase. (WAC 284-30A-070(6); WAC 284-30A-080)
  • Insurers must keep accessible records of premium increase explanations under RCW 48.05.280. (WAC 284-30A-050(10))
  • Insurers are not obligated to disclose usage-based insurance data, credit-based insurance scoring models, company placement criteria, or trade secrets. (WAC 284-30A-020(4)(c-d))
  • Violations of Chapter 284-30A WAC constitute unfair trade practices and may result in penalties and remedies. Chapter 48.30 RCW and Chapter 284-30 WAC. (WAC 284-30A-90(1))