Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Credit for Reinsurance › Section R. 500.1122 - Definitions

Current through Vol. 24-12, July 15, 2024
Rule 2.
(1) As used
				in these rules:
(a) "Beneficiary" means the
				entity for whose sole benefit a trust or letter of credit has been established
				and any successor of the beneficiary by operation of law. If a court of law
				appoints a successor in interest to the named beneficiary, then the named
				beneficiary includes and is limited to the court appointed domiciliary receiver
				(including conservator, rehabilitator, or liquidator).
(b) "Code" means the insurance code of 1956,
				1956 PA 218, MCL 500.100 to 500.8302.
(c) "Department" means the Michigan
				department of insurance and financial services.
(d) "Director" means the director of the
				department.
(e) "Grantor" means the
				entity that has established a trust for the sole benefit of the beneficiary.
				When a trust is established in conjunction with a reinsurance agreement, the
				grantor is the unlicensed, unaccredited assuming insurer.
(f) "Liabilities" means the assuming
				insurer's gross liabilities attributable to reinsurance ceded by United States
				domiciled insurers
,
excluding liabilities that are otherwise
				secured by acceptable means, and includes all of the following:
(i) For business ceded by domestic insurers
				authorized to write accident and health, and property and casualty insurance
				all of the following:
(A) Losses and allocated
				loss expenses paid by the ceding insurer, recoverable from the assuming
				insurer.
(B) Reserves for losses
				reported and outstanding.
(C)
				Reserves for losses incurred but not reported.
(D) Reserves for allocated loss
				expenses.
(E) Unearned
				premiums.
(ii) For
				business ceded by domestic insurers authorized to write life, health, and
				annuity insurance all of the following:
(A)
				Aggregate reserves for life policies and contracts net of policy loans and net
				due and deferred premiums.
(B)
				Aggregate reserves for accident and health policies.
(C) Deposit funds and other liabilities
				without life or disability contingencies.
(D) Liabilities for policy and contract
				claims.
(g)
				"NAIC" means the National Association of Insurance Commissioners.
(h) "Obligations" means any of the following:
(i) Reinsured losses and allocated loss
				expenses paid by the ceding company, but not recovered from the assuming
				insurer.
(ii) Reserves for
				reinsured losses reported and outstanding.
(iii) Reserves for reinsured losses incurred
				but not reported.
(iv) Reserves for
				allocated reinsured loss expenses and unearned premiums.
(i) "Solvent scheme of arrangement" means a
				foreign or alien statutory or regulatory compromise procedure that is subject
				to requisite majority creditor approval and judicial sanction in the assuming
				insurer's home jurisdiction either to finally commute liabilities of duly
				noticed classed members or creditors of a solvent debtor or to reorganize or
				restructure the debts and obligations of a solvent debtor on a final basis and
				that may be subject to judicial recognition and enforcement of the arrangement
				by a governing authority outside the ceding insurer's home
				jurisdiction.