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									                          NORTH CAROLINA DEPARTMENT OF INSURANCE
                                ACTUARIAL SERVICES DIVISION

              2009 NORTH CAROLINA PROFESSIONAL LIABILITY DATA REPORT
                 [ §NCGS 58-2-170 (a) and (b), §NCGS58-2-190 and 11 NCAC 16.0104 ]

              INSTRUCTIONS FOR PROVIDING PROFESSIONAL LIABILITY DATA


                                  CHANGE FOR THIS YEAR
        The Data Call and the Verification Form are only required to be submitted if a
     company wrote professional liability insurance with at least $25,000 of Direct Written
                                       Premium in 2009.
      If a company wrote professional liability insurance with less than $25,000 of Direct
     Written Premium in 2009, OR no professional liability insurance at all, then neither a
            Data Call nor a Verifcation Form is required; no submission is required.

I.   Who Must Provide Data

The Professional Liability Data Report is required under North Carolina General Statute §NCGS 58-2-170
(a) and (b), §NCGS 58-2-190 and 11 NCAC 16.0104. Insurers, self-insurers and RRG’s which wrote
$25,000 or more in direct written premium in 2009 in North Carolina for “professional liability” insurance
must complete the Verification Form and Data Call.

“Professional liability” insurance includes medical malpractice as well as insurance on other professionals
such as lawyers, accountants, and directors and officers. A list of “professional liability” coverages is
contained in the document <09NCPL_CoverageList.doc> which is available on the Department’s web site.
The term “professional liability” corresponds to NC lines of authority 13b (Other Personal Injury Liability)
and 14b (Other Property Damage Liability), or to Annual Statement line of business 11 (Medical
Malpractice) and a portion of line 17 (Other Liability).

II. The Data Call Template

A.        Overview of the Template

     1) The data call template is the excel spreadsheet <09NCPL_DataCall.xls>. Open the template and
        save it to your computer by the same file name and as type “Microsoft Excel Workbook.”
     2) If multiple copies are necessary for different companies, add a number count to the template name
        such as <09NCPL_DataCall1.xls>, <09NCPL_DataCall2.xls>, <09NCPL_DataCall3.xls>, etc.
        (Conforming to this naming convention will allow the Department to compile the data
        automatically using a macro.)
     3) If you have any difficulty opening the Excel spreadsheet <09NCPL_DataCall.xls>, highlight the
        file name and right-click the mouse. Choose “Save Target As.” A message box will then appear
        that allows the file to be saved.
     4) Go to the sheet labeled “Exhibit of Direct and Net Data.” Enter the company’s five-digit NAIC
        code in cell [ C6 ]. This is an important step! Please be aware of two potential errors: (1) If you
        experience a protection error, first check to see that your cursor is positioned in cell [ C6 ] and not
        in another cell such as [ A1 ]. If you are still unable to enter the company’s NAIC code, and you
        are unable to enter data in the white areas of the Exhibit, then you may be using an outdated
        version of Excel. Only recent versions of Excel (later than year 2000) allow partial spreadsheet
        protection. If you are unable to secure a more recent Excel version, please contact the Department
        for assistance. (2) If you enter the NAIC code and your company name does not automatically



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        appear, please double check the NAIC code, and if the code is entered correctly then contact the
        Department for assistance. [Email: actprofliab@ncdoi.gov].
     5) Enter your company data in the white area of columns (2) - (8), (10) - (13), (16) - (22) and
        (24) - (27). More detailed instructions follow in sections II. B, C, and D.
     6) Go to the sheet labeled “SelfTest Results.” There are eight self-tests. The results display in cells
        [ H30 ] (Self-Test 1), [ H51 ] (Self-Test 2), [ H75 ] (Self-Test 3), [ H95 ] (Self-Test 4), [ K122 ]
        (Self-Test 5), and [ K145 ] (Self-Test 6), [ K171 ] (Self-Test 7), and [ K194 ] (Self-Test 8). If
        losses have been entered without corresponding claim counts, or if there are discrepancies in the
        data entered or between the data entered and the Annual Statement beyond a nominal range, the
        result will be “FAIL.” Self-Tests 3 and 4 will only be meaningful if the company’s five-digit
        NAIC code has been correctly entered in cell [ C6 ] of the “Exhibit of Direct and Net Data”; these
        two tests use the company’s NAIC code to look up Annual Statement data for comparison against
        the data entered. If any of the six tests fail, the data submission will be returned, the company will
        be considered not be in compliance, and penalties may result. More detailed instructions follow in
        section II. B (2).
     7) Once data is entered and all of the six self-tests “PASS,” save the worksheet and keep a copy for
        your records. The file may be submitted electronically to the Department as an email attachment,
        with the verification form for the company to be included as an additional attachment. Any
        necessary explanations should be made in the cover letter (email message); otherwise, no cover is
        required. If it is not possible to send the files through email, they may be saved to a CD or disk
        and sent by regular postal mail along with a signed verification form. Please see section III below
        for details on submitting the verification form and data call to the Department.


B.       Description of the Template

The workbook contains two worksheets: “Exhibit of Direct and Net Data” and “SelfTest Results.”

         1. Exhibit of Direct and Net Data

     * *Enter the five-digit company NAIC Code in cell [ C6 ].* * This will allow Self-Test 3 and Self-
     Test 4 to populate automatically with Annual Statement data. The NAIC Code is also required by the
     Department to identify the company and to run a macro which will compile the data submissions
     automatically. The data call will not be accepted without this code. If the company name does not
     appear when the code is entered, check <09NCPL_CompanyRequirementList.doc> and the box
     checked on <09NCVF_VerificationForm.xls> to see if only the Verification Form is needed.

     This exhibit contains direct data (excluding the effects of reinsurance ceded and assumed) in the cells
     [ E15:R86 ] and net data (including the effects of reinsurance ceded and assumed: direct + assumed -
     ceded) in the cells [ T15:AG86 ]. The exhibit has 29 numbered columns of data including subtotals
     and totals with data to be entered in 22 input columns: direct in columns (2) - (8) and (10) - (13), and
     net in columns (16) - (22) and (24) - (27). The spreadsheet has been formatted to print in two letter-
     sized pages with the common row headings of columns [ A:D ].

     The spreadsheet is partially protected so that subtotal and total columns can not be altered. Only input
     columns allow entries. You must be using a version of Excel later than 2000 in order for partial
     protection to function properly. If you can not enter data in any cell including input cells, then the
     version of Excel you are using is outdated and does not allow for partial protection. Please contact the
     Department for assistance if you are unable to secure a more recent version of the Excel program.
     [Email: actprofliab@ncdoi.gov].

     Instructions on entering data appear below under II.C. Descriptions of the data to be entered appear
     below under section II.D.

         2. SelfTest Results

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       There are eight self-tests which have changed slightly from previous years’ reports. The first two
       tests check that portions of the data entered in the spreadsheet are in agreement. The second two
       tests check that data entered are in agreement with data from the North Carolina State Page
       (Statutory Page 14) of the 2009 Annual Statement. The next two self-tests check to see that claim
       counts have been entered corresponding to any incurred loss or Defense & Cost Containment
       amounts entered. The final two self-tests check that closed claim counts correspond to loss
       payments.

       If any of the results appears as “FAIL”, data in the “Exhibit of Direct and Net Data” must be
       reviewed and corrected in order to have the result “PASS.” Otherwise, the data submission will
       be returned, the company will be considered not in compliance, and penalties may result.
       i) Self-Test 1: This test checks that the sum of direct data entries [ II. A. (1) (a) + II. A. (1) (b) +
            II. B. (1) ] equals the sum of direct data entries [ II. C. (1) + II. C. (2) ] in the “Exhibit of
            Direct and Net Data.” The two sums represent two divisions of loss payments, one based on
            the timing of payments and the other on the type of claim settlement; the total of these two
            sums must be equal. This test is located at [ B11:H30 ]. If the absolute difference for a
            specialty displayed in column (E) exceeds 10, an error will be counted for that specialty in
            column (F). A non-zero result in column (F) will cause a FAIL for this self-test.
       ii) Self-Test 2: This test is the same as Self-Test 1 except on a net basis. This test checks that the
            sum of net data entries [ II. A. (1) (a) + II. A. (1) (b) + II. B. (1) ] equals the sum of net data
            entries [ II. C. (1) + II. C. (2) ] in the “Exhibit of Direct and Net Data.” This test is located at
            [ B32:H51 ]. A non-zero result in column (F) will cause a FAIL for this self-test.
       iii) Self-Test 3: This test reconciles medical malpractice data entered in the data call with line 11
            of the North Carolina State Page (Statutory Page 14) of the 2009 Annual Statement. These
            two sets of data should be identical. The test is located at [ B59:K76 ]. The Annual Statement
            data will automatically populate if the company’s NAIC code has been entered in cell [ C6 ] of
            the “Exhibit of Direct and Net Data.” The absolute difference is calculated between data
            entered and the corresponding columns of the North Carolina State Page exhibit. If the
            absolute difference exceeds 10, an error will be counted for that Annual Statement exhibit
            column in the self-test column (F).
       iv) Self-Test 4: This test reconciles the data of lawyers, accountants, engineers and architects,
            and other professionals entered in the data call with line 17 of the North Carolina State Page
            exhibit of the Annual Statement. The former should be a subset of the latter, and will be equal
            or smaller so long as negative values have not occurred. The test is located at [ B78:K95 ].
            The difference is calculated between data entered and the corresponding columns of the North
            Carolina State Page exhibit. No error will be counted in column (F) if the Annual Statement
            value is negative. If the Annual Statement value for any column of the North Carolina State
            Page exhibit exceeds the data entered by more than 10, an error will be counted for that
            Annual Statement exhibit column in the self-test column (F). In rare instances where negative
            values have occurred for certain specialties within line 17, a “FAIL” may result which is
            acceptable to the Department. In such an instance, an explanation should be included in the
            cover letter (email) that accompanies the data call submission. The explanation should
            provide figures reconciling the difference between the data call entries and the Annual
            Statement.
       v) Self-Test 5: This test checks that the direct entry [ VI.A.(2) ] is positive whenever the sum of
            direct entries [ VI.A.(1) + VIII.A.(1) ] is positive; and likewise, that [ VI.B.(2) ] is positive
            whenever [ VI.B.(1) + VIII.B.(1)] is positive. Case claim counts at the beginning and end of
            2009 must be entered in correspondence with case reserves entered. This test is located at
            [ B101:K121 ]. If claim counts for a specialty are zero or negative when case reserves are
            positive for that specialty, an error will be counted in the self-test column (G). If a company
            does not record case incurred claim counts, counts should be estimated for the data call.
       vi) Self-Test 6: This test is the same as Self-Test 1 except on a net basis. This test checks that the
            net entry [ VI.A.(2) ] is positive whenever the sum of net entries [ VI.A.(1) + VIII.A.(1) ] is
            positive; and likewise, that [ VI.B.(2) ] is positive whenever [ VI.B.(1) + VIII.B.(1)] is

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                     positive. Case claim counts at the beginning and end of 2009 must be entered in
                     correspondence with case reserves entered. This test is located at [ B123:K143 ]. If claim
                     counts for a specialty are zero or negative when case reserves are positive for that specialty, an
                     error will be counted in the self-test column (G).
               vii) Self-Test 7: This test checks that the sum of direct entries [III.A.(1)(a) + III.A.(1)(b) +
                     III.A.(2)(a) + III.A.(2)(b) ] is positive and that either [ IV.A. ] or [ IV.A. ] is positive,
                     whenever the sum of direct entries [II.A.(1)(b) + II.A.(2)(b) + II.B.(1) + II.B.(2)] is positive.
                     Claims closed with payments are expected to be in correspondence with loss payments and a
                     highest value claim. This test is located at [ B149:K170 ]. If claims closed with payments are
                     zero or negative when loss payments and a highest value claim are positive for that specialty,
                     an error will be counted in the self-test column (G).
               viii) Self-Test 8: This test is the same as Self-Test 7 except on a net basis. This test checks that the
                     sum of net entries [III.A.(1)(a) + III.A.(1)(b) + III.A.(2)(a) + III.A.(2)(b) ] is positive and that
                     either [ IV.A. ] or [ IV.A. ] is positive, whenever the sum of net entries [II.A.(1)(b) +
                     II.A.(2)(b) + II.B.(1) + II.B.(2)] is positive. Claims closed with payments are expected to be
                     in correspondence with loss payments and a highest value claim. This test is located at
                     [ B172:K193 ]. If claims closed with payments are zero or negative when loss payments and a
                     highest value claim are positive for that specialty, an error will be counted in the self-test
                     column (G).

C.             Entering Data

     1.        General Rules for Entering Data:

          i)     Data should be entered in the white input areas of the Exhibit of Direct and Net Data.
                 Enter numerical data only. If explanations are needed, include them in a cover letter (email).
          ii)    Enter only full dollar amounts. Do not use commas, decimals, or dollar signs.
          iii)   If you have no data to report for a given cell, leave it blank. Do not input “N/A” or dashes.
          iv)    Negative numbers should be indicated by a dash (subtraction sign). Do not use parentheses.
          v)     Save the worksheet often during the process of entering data.




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  2.         Common Errors

             The most common errors in completing the data call template are:

       i)      Failure to input the five-digit company NAIC code in cell [ C6 ] of the “Exhibit of Direct and
               Net Data.” If you do not input the company code, a series of errors will follow.
       ii)     Submitting data which does not pass all of the self-tests. These eight tests should be reviewed in
               the spreadsheet <SelfTest Results>, cells A9 to K193. In special circumstances, a company may
               fail Self-Test 4 and still be able to submit data; this generally occurs when certain line 17
               premiums are negative. An explanation should be provided in a cover letter (email). For
               smaller companies, loss payments may be made in years that no claims close with payments, in
               which case the company will fail Self-Tests 7 and 8. This should be noted in the cover letter
               (email).
       iii)    Naming the spreadsheet incorrectly; renaming the file other than by appending a number at the
               end of the template name. The spreadsheet name <09NCPL_DataCall.xls> should be
               maintained so that it can be read by the Department’s compilation macro. If the spreadsheets for
               several companies are to be saved on the same drive, a number count may be appended to the
               spreadsheet name: <09NCPL_DataCall2.xls>, <09NCPL_DataCall3.xls>, etc., to discern the
               files.
       iv)     Entering non-numeric data into cells for which numeric data is intended. If written explanations
               are necessary, please include a cover letter (email message) with your submission.
       v)      Entering case incurred losses and/or case incurred Defense & Cost Containment and/or loss
               payments, without entering corresponding claim counts. If case incurred claim counts are
               unavailable, counts should be estimated.

             Please be sure to check the above five areas before submitting data. It will save time and avoid
             questions and correspondence from the Department.

  D. Detailed Description of the Data to be Entered

  I.A.         Premiums written during 2009.
  I.B.         Premiums earned during 2009.
  II.A.(1)(a)  Total loss payments (excluding loss adjustment expenses) that were made prior to 2009
               on those claims opened prior to 2009 and closed during 2009.
  II.A.(1)(b) Total loss payments (excluding loss adjustment expenses) that are made during 2009 on
               those claims opened prior to 2009 and closed during 2009.
  II.A.(2)(a) Total loss payments (excluding loss adjustment expenses) that are made prior to 2009 on
               those claims opened prior to 2009 and remaining opened at the end of 2009.
  II.A.(2)(b) Total loss payments (excluding loss adjustment expenses) that are made during 2009 on
               those claims opened prior to 2009 and remaining opened at the end of 2009.
  II.B.(1)     Total loss payments (excluding loss adjustment expenses) that are made during 2009 on
               those claims opened and closed during 2009.
  II.B.(2)     Total loss payments (excluding loss adjustment expenses) that are made during 2009 on
               those claims opened during 2009 and remaining opened at the end of 2009.
  II.C.(1)     Total loss payments (excluding loss adjustment expenses) on all closed claims during
               2009 as a result of court judgement. These payments should correspond with the number
               of claims closed on lines [III.A.(1)(a) + III.A.(2)(a)].
  II.C.(2)     Total loss payments (excluding loss adjustment expenses) on all closed claims during
               2009 as a result of other settlement. These payments should correspond with the number
               of claims closed on lines [III.A.(1)(b) + III.A.(2)(b)].
  III.A.(1)(a) The number of claims that are pending at the beginning of 2009 and closed with loss
               payments (excluding loss adjustment expenses) as a result of court judgment during 2009.



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  III.A.(1)(b) The number of claims that are pending at the beginning of 2009 and closed with loss
               payments (excluding loss adjustment expenses) as a result of other settlement during
               2009.
  III.A.(2)(a) The number of claims that are arising during 2009 and closed with payments (excluding
               loss adjustment expenses) as a result of court judgment during 2009.
  III.A.(2)(b) The number of claims that are arising during 2009 and closed with payments (excluding
               loss adjustment expenses) as a result of other settlement during 2009.
  III.B.(1)(a) The number of claims that are pending at the beginning of 2009 and closed without loss
               payments (excluding loss adjustment expenses) as a result of court judgment during 2009.
  III.B.(1)(b) The number of claims that are pending at the beginning of 2009 and closed without loss
               payments (excluding loss adjustment expenses) as a result of other settlement during
               2009.
  III.B.(2)(a) The number of claims that are arising during 2009 and closed without payments
               (excluding loss adjustment expenses) as a result of court judgment during 2009.
  III.B.(2)(b) The number of claims that are arising during 2009 and closed without payments
               (excluding loss adjustment expenses) as a result of other settlement during 2009.
  4A.          The highest amount (excluding loss adjustment expense) that is paid on a claim closed
               with payment during 2009 as a result of court judgment.
  4b.          The smallest amount (excluding loss adjustment expense) that is paid on a claim closed
               with payment during 2009 as a result of court judgment.
  4c.          Put all claims closed with payment during 2009 as a result of court judgment in order
               from the smallest to the largest. (In putting the claims in order, exclude loss adjustment
               expense.) Select the claim that is in the middle of the distribution and enter the amount
               paid on it. If the number of claims are even (2, 4, 6…), average the two in the middle of
               the distribution.
  5A.          The highest amount (excluding loss adjustment expense) that is paid on a claim closed
               with payment during 2009 as a result of other settlement.
  5B.          The smallest amount (excluding loss adjustment expense) that is paid on a claim closed
               with payment during 2009 as a result of other settlement.
  5C.          Put all claims closed with payment during 2009 as a result of other settlement in order
               from the smallest to the largest. (In putting the claims in order, exclude loss adjustment
               expense.) Select the claim that is in the middle of the distribution and enter the amount
               paid on it. If the number of claims are even (2, 4, 6…), average the two in the middle of
               the distribution.
  6.A.(1)      Amount of case loss reserves at the beginning of 2009 on claims that are pending at the
               beginning of 2009.
  6.A.(2)      Number of case outstanding claims at the beginning of 2009 on claims that are pending at
               the beginning of 2009.
  6.A.(3)      Amount of IBNR at the beginning of 2009 on claims that are pending at the beginning of
               2009.
  6.A.(4)      OPTIONAL to REPORT: Number of IBNR claims at the beginning of 2009 on claims
               that are pending at the beginning of 2009.
  6.B.(1)      Amount of case loss reserves at the end of 2009 on claims that remain pending at the end
               of 2009.
  6.B.(2)      Number of case outstanding claims at the end of 2009 on claims that remain pending at
               the end of 2009.
  6.B.(3)      Amount of IBNR at the end of 2009 on claims that remain pending at the end of 2009.
  6.B.(4)      OPTIONAL to REPORT: Number of IBNR claims at the end of 2009 on claims that
               remain pending at the end of 2009.
  7.A.         Portion of loss adjustment expense paid during 2009 that can be allocated to individual
               claims.
  7.B.         Portion of loss adjustment expense paid during 2009 that cannot be allocated to
               individual claims.
  8.A.(1)      Case allocated loss adjustment expenses reserves at the beginning of 2009 for claims that
               are pending at the beginning of 2009.

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       8.A.(2)      IBNR allocated loss adjustment expense reserves at the beginning of 2009 for claims that
                    are pending at the beginning of 2009.
       8.A.(3)      Unallocated loss adjustment expense reserve at the beginning of 2009 for claims that are
                    pending at the beginning of 2009.
       8.B.(1)      Case allocated loss adjustment expenses reserves at the end of 2009 for claims that
                    remain pending at the end of 2009.
       8.B.(2)      IBNR allocated loss adjustment expense reserves at the end of 2009 for claims that
                    remain pending at the end of 2009.
       8.B.(3)      Unallocated loss adjustment expense reserve at the end of 2009 for claims that remain
                    pending at the end of 2009.

III.       Submitting the Data Call

       A. By email: After saving the completed data call spreadsheet to your computer as
          <09NCPL_DataCall.xls>, the file can be attached to an email and sent to the actuarial division of
          the North Carolina Department of Insurance at actprofliab@ncdoi.gov. Include any explanations
          in the email message. A cover message is not necessary otherwise. An electronic version of the
          Verification Form spreadsheet is no longer a required attachment. However, if legal electronic
          signatures are used in the verification form spreadsheet <09NCVF_VerificationForm.xls>, all
          requirements can be attached to one email. For any company that submits a data call, a scanned
          *.pdf version of the Verification Form does not meet requirements. If legal electronic signatures
          are not available, a signed hard copy of the verification form must be mailed to the Department for
          legal purposes. Mail the hard copy to the address printed at the top of the verification form.

       B. By postal mail: After saving the completed data call spreadsheet to your computer as
          <09NCPL_DataCall.xls>, the file should be saved to a clean, blank CD or disk. A signed hard
          copy of the corresponding verification form must be included with the CD(s) or disk(s); or, legal
          electronic signatures may be used in the verification form spreadsheet
          <09NCVF_VerificationForm.xls> saved to the same CD or disk (as space permits) or to a separate
          one placed in the same package. If legal electronic signatures are not available, mail the CD(s) or
          disk(s) with the signed verification form to the address printed at the top of the verification form,
          Attention: Professional Liability.




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