Quota Info

Quotas

A member’s quota ratio is based on its voluntary market writings compared to the total statewide voluntary writings. Credit is given against the members final quota ratio for existing TAIPA writings. The TAIPA writings for Private Passenger are reported to TAIPA by the Texas Department of Insurance from a members Quarterly Experience Report. Other Than Private Passenger TAIPA writings are reported by Insurance Services Office Inc. Due to reporting quidelines, there is a 1 quarter delay in obtaining TAIPA writings. A members failure to report TAIPA data will result in the member receiving more than the required number of new assignments since there is no credit to apply to the quota ration.

Territorial Credit Information

Navigation	Title
Points of Interest	Tac Viewer
TITLES	Title 28 Insurance
PARTS	Part 1 Texas Department of Insurance
CHAPTERS	Chapter 5 Property and Casualty Insurance
SUBCHAPTERS	Subchapter A Automobile Insurance
DIVISIONS	Division 3 Miscellaneous Interpretations
RULES	5.206 Designation of Underserved Zip Codes
A) CLASS 4 ZIP CODES	Zip codes listed as Class 4
B) CLASS 3 ZIP CODES	Zip codes listed as Class 3
C) CLASS 2 ZIP CODES	Zip codes listed as Class 2
D) CLASS 1 ZIP CODES	Zip codes listed as Class 1

Private Passenger Quotas

These quota ratios are based on the “average” number of private passenger vehicles, on policies in force that are written in the voluntary market for a rolling “4 quarter period” less credits for writing in “underserved” areas and credits for “voluntary take-outs”. Data is reported to TAIPA from the member’s Quarterly Market Report.

Average = The average of the vehicles on policies in force at the end of a quarter and the vehicles on policies in force at the end of the previous quarter.
Four Quarter Period = The sum of the average vehicles on policies in force for the previous 4 quarters.
Underserved Areas = Zip Code areas designated by the Commissioner as being underserved. The credits range from a 1 to 1 credit, up to a 4 for 1 credit. Writings in these Zip Code areas will reduce a member’s quota obligation.
Voluntary Take-outs = A member may offer to write a TAIPA insured in their voluntary company, at a rate lower than the TAIPA rate, if the insured has been insured through TAIPA for the 1 year period immediately preceding the issuance of the voluntary policy. If the offer is accepted, the member will receive a 2 for 1 credit for a 4 quarter period, thereby reducing their quota obligation.

Quarterly Base Data

Due to reporting guidelines of the Quarterly Market Report, there is a 2 quarter delay in receiving data.
The quarters are based on average vehicles in a rolling 4 quarters as shown in the following examples.

1st Quarter Quota Ratio
3rd and 4th quarters of the 2nd prior year, plus 1st and 2nd quarters of prior year = base for 1st quarter quotas.
e.g 1st quarter 2005 ratio is based on, 3rd and 4th quarters of 2003, plus 1st and 2nd quarters of 2004.

2nd Quarter Quota Ratio
4th quarter of the 2nd prior year, plus the 1st, 2nd and 3rd quarters of the prior year =base for 2nd quarter quotas.
e.g. 2nd quarter 2005 ratio is based on, 4th quarter of 2003, plus 1st, 2nd and 3rd quarters of 2004.

3rd Quarter Quota Ratio
1st through 4th quarters of the prior year.
e.g. 3rd quarter 2005 ratio = 1st through 4th quarters 2004.

4th Quarter Quota Ratio
2nd, 3rd and 4th quarters of the prior year, plus 1st quarter of current year.
e.g. 4th quarter 2005 ratios = 2nd, 3rd and 4th quarters of 2004, plus the 1st quarter of 2005.

Calculation of the Private Passenger basic quota

Other Than Private Passenger

These annual quota ratios are based on 2nd prior year net direct voluntary writings as shown on the Exhibit of Premiums and Losses of the Annual Statement, less direct written premiums for TAIPA business. These written premiums are reported to T.A.I.P.A by Insurance Services Office, Inc (ISO), the designated commercial statistical agent for Texas. e.g. Year 2005 = 2003 net direct voluntary writings.

Additional Information

Additional questions about quotas and quota calculations please call our main line
at (512) 444-4441.