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Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Utilization Review › Part 1 - GENERAL › Section R. 500.61 - Definitions

Current through Vol. 24-12, July 15, 2024
Rule 61. As used in these rules:
(a) "Act" means the insurance code of 1956,
				  1956 PA 218, MCL 500.100 to 500.8302.
(b) "Association" means the catastrophic
				  claims association created under section 3104 of the act, MCL
				  500.3104.
(c) "Department" means
				  the department of insurance and financial services.
(d) "Director" means the director of the
				  department.
(e) "Facility" means an
				  entity licensed by the state pursuant to the public health code, 1978 PA 368,
				  MCL 333.1101 to 333.25211. The office of an individual practitioner is not
				  considered a facility.
(f) "Injured
				  person" means a person who has suffered an accidental bodily injury covered by
				  personal protection insurance provided under chapter 31 or 31A of the act, MCL
				  500.3101 to 500.3179 and 500.3181 to 500.3189.
(g) "Insurer" means that term as defined in
				  section 106 of the act, MCL 500.106.
(h) "Managed care option" means that term as
				  defined in section 3181 of the act, MCL 500.3181.
(i) "Medically accepted standards" means the
				  most appropriate practice guidelines for the treatment, training, products,
				  services and accommodations provided to an injured person. These practice
				  guidelines may include generally accepted practice guidelines, evidence-based
				  practice guidelines, or any other practice guidelines developed by the federal
				  government or national or professional medical societies, boards, and
				  associations.
(j) "Personal
				  protection insurance" means benefits provided under section 3107(1)(a) of the
				  act, MCL 500.3107(1)(a).
(k)
				  "Practitioner" means an individual who is licensed, registered, or certified as
				  used in the public health code, 1978 PA 368, MCL 333.1101 to
				  333.25211.
(l) "Provider" means a
				  physician, hospital, clinic, or other person providing treatment, training,
				  products, services, and accommodations to an injured person.
(m) "Utilization review" means that term as
				  defined in section 3157a(6) of the act, MCL 500.3157a(6).
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Utilization Review › Part 1 - GENERAL › Section R. 500.62 - Scope and applicability

Current through Vol. 24-12, July 15, 2024
Rule 62. These rules do all of the following:
(a) Establish criteria and standards for
				  utilization review that identify utilization of treatment, training, products,
				  services, and accommodations provided to an injured person for the injured
				  persons care, recovery, or rehabilitation as required under section 3107(1)(a)
				  of the act, MCL 500.3107(1)(a), above the usual range of utilization, based on
				  medically accepted standards.
(b)
				  Establish procedures for all of the following:
(i) Acquisition of necessary records, medical
				  bills, and other information concerning the treatment, training, products,
				  services, and accommodations provided to an injured person.
(ii) For an insurer and for the association
				  to request an explanation for, and requiring a provider to explain, the
				  reasonable necessity or indication for treatment, training, products, services,
				  and accommodations provided to an injured person.
(iii) Provider appeals to the department from
				  an insurers or the associations determination that the provider overutilized or
				  otherwise rendered or ordered inappropriate treatment, training, products,
				  services, and accommodations, or that the cost of the treatment, training,
				  products, services, and accommodations was inappropriate under chapter 31 of
				  the act, MCL 500.3101 to 500.3179, and rules promulgated thereunder.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Utilization Review › Part 2 - REQUESTS FOR EXPLANATION AND RECORD RETENTION › Section R. 500.63 - Requests for explanation

Current through Vol. 24-12, July 15, 2024
Rule 63.
(1) If a
				  provider provides treatment, training, products, services, or accommodations to
				  an injured person that are not usually associated with, are longer in duration
				  than, are more frequent than, or extend over a greater number of days than the
				  treatment, training, products, services, or accommodations usually required for
				  the diagnosis or condition for which the injured person is being treated, the
				  insurer or the association may request that the provider explain the necessity
				  or indication for the treatment, training, products, services, or
				  accommodations in writing. An insurer or the association may request that the
				  provider include in its written explanation medical records, bills, and other
				  information concerning the treatment, training, products, services, or
				  accommodations.
(2) If an insurer
				  or the association requests a provider to provide a written explanation under
				  this rule, the request must be submitted to the provider within 30 days of the
				  insurers or associations receipt of the bill related to the treatment,
				  training, products, services, or accommodations.
(3) A provider that receives a request for a
				  written explanation from an insurer or the association must respond within 30
				  days of receipt of the insurers or associations request.
(4) If an insurers or the associations
				  request for records under subrule (1) of this rule requires the provider to
				  provide medical records, bills, or other information in excess of that which
				  customarily accompany a bill submitted to the insurer or the association, the
				  insurer or the association must reimburse the provider at a reasonable and
				  customary fee, plus the actual costs of copying and mailing, within 30 days of
				  the insurers or associations request.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Utilization Review › Part 3 - INSURER AND ASSOCIATION DETERMINATIONS AND PROVIDER APPEALS › Section R. 500.64 - Determinations by an insurer or the association

Current through Vol. 24-12, July 15, 2024
Rule 64.
(1) If,
				  after reviewing a providers written explanation provided under part 2 of these
				  rules, an insurer or the association determines that a provider overutilized or
				  otherwise rendered or ordered inappropriate treatment, training, products,
				  services, or accommodations, or that the cost of the treatment, training,
				  products, services, or accommodations was inappropriate under chapter 31 of the
				  act, MCL 500.3101 to 500.3179, the insurer or the association must issue a
				  written notice of the determination to a provider within 30 days of receipt of
				  the providers written explanation. The notice must include all of the
				  following:
(a) The criteria or standards on
				  which the insurer relied in making its determination, with specific reference
				  to the insurers utilization review program.
(b) The amount of payment to the provider
				  that has been made as a result of the determination, including an explanation
				  for the difference between that amount and the amount billed by the
				  provider.
(c) If applicable, a
				  description of any additional records the provider must submit to the insurer
				  in order for the insurer or the association to reconsider its
				  determination.
(d) A copy of the
				  form referenced in R 500.65(1).
(e)
				  The date of the determination.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Utilization Review › Part 3 - INSURER AND ASSOCIATION DETERMINATIONS AND PROVIDER APPEALS › Section R. 500.65 - Appeals to the department

Current through Vol. 24-12, July 15, 2024
Rule 65.
(1) A
				  provider may appeal a determination made by an insurer or the association. The
				  appeal must be filed within 90 days of the date of the disputed determination
				  and must be made on a form prescribed by the department.
(2) Within 14 days of receipt of a provider
				  appeal, the department shall notify the insurer or the association and the
				  injured person of the appeal and request any additional information necessary
				  to review the appeal.
(3) An
				  insurer or the association may file a reply to a providers appeal no later than
				  21 days after the date of the notice provided under subrule (2) of this
				  rule.
(4) The director shall base
				  his or her decision upon written materials submitted by the parties. Failure of
				  any party to supply any information in a timely manner shall result in a
				  decision based upon information available to the director at the time of the
				  decision.
(5) The director shall
				  issue a decision within 28 days after the insurer or the association files a
				  reply to a providers appeal or, if a reply is not filed, within 28 days after
				  the time for filing a reply has expired. The director may, upon written notice
				  to the insurer or the association and the provider, take an additional 28 days
				  to issue a decision under this rule.
(6) If a provider appeals a determination
				  made by an insurer and the department issues a decision that the provider is
				  entitled to payment, the provider is entitled to interest on any overdue
				  payments as set forth in section 3142 of the act, MCL 500.3142.
(7) A decision issued by the department under
				  these rules is subject to judicial review as provided in section 244(1) of the
				  act, MCL 500.244(1).
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Utilization Review › Part 4 - INSURER UTILIZATION REVIEW PROGRAM › Section R. 500.66 - Required components of an insurers utilization review program

Current through Vol. 24-12, July 15, 2024
Rule 66.
(1)
				  Within 60 days of the effective date of these rules, insurers must have in
				  place a utilization review program to review records and bills for treatment,
				  training, products, services, and accommodations provided to an injured person
				  that is above the usual range of utilization based on medically accepted
				  standards.
(2) The utilization
				  review program must do all of the following:
(a) Provide for bill review, including
				  whether provider charges for treatment, training, products, services, and
				  accommodations comply with chapter 31 of the act, MCL 500.3101 to 500.3179, and
				  rules promulgated thereunder.
(b)
				  Make determinations regarding the appropriateness of treatment, training,
				  products, services, and accommodations based on medically accepted
				  standards.
(c) Issue determinations
				  under R 500.64.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Utilization Review › Part 4 - INSURER UTILIZATION REVIEW PROGRAM › Section R. 500.67 - Renewal of certification

Current through Vol. 24-12, July 15, 2024
Rule 67. An insurer must apply for renewal of its
					 certification on a form prescribed by the department. The application must be
					 submitted no less than 90 days prior to the expiration of the insurers current
					 certification.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Utilization Review › Part 5 - ANNUAL REPORT AND RECORD RETENTION › Section R. 500.68 - Annual report

Current through Vol. 24-12, July 15, 2024
Rule 68.
(1) No
				  later than March 31 of each year, each insurer shall submit a report on a form
				  prescribed by the department regarding utilization review data and activities.
				  The department shall provide instruction to insurers regarding completion of
				  the report.
(2) The annual report
				  is subject to disclosure under the freedom of information act, 1976 PA 442, MCL
				  15.231 to 15.246.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Utilization Review › Part 5 - ANNUAL REPORT AND RECORD RETENTION › Section R. 500.69 - Record retention

Current through Vol. 24-12, July 15, 2024
Rule 69. Insurers, the association, and providers must
					 retain copies of all requests, explanations, and determinations issued under
					 these rules for at least two years after the date of the request, explanation,
					 or written notice, and must submit them to the department upon
					 request.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Holding Companies › Section R. 500.71 - Definitions

Current through Vol. 24-12, July 15, 2024
Rule 1.
(1) As used
				in these rules:
(a) "Act" means the insurance
				code of 1956, 1956 PA 218, MCL
				500.100 to
				500.8302.
(b) "Chapter 13" means chapter 13 of the act,
				MCL 500.1301 to
				500.1379.
(c) "Executive officer" means chief executive
				officer, chief operating officer, chief financial officer, treasurer,
				secretary, controller, and another individual performing functions
				corresponding to those performed by the individuals described in this
				subdivision without regard to title.
(d) "Ultimate controlling person" means the
				person that is not controlled by another person.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Holding Companies › Section R. 500.72 - Purpose

Current through Vol. 24-12, July 15, 2024
Rule 2. These rules set forth requirements and procedures
				  that the director considers necessary to carry out chapter 13. These rules are
				  necessary and appropriate in the public interest and for the protection of the
				  policyholders in this state.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Holding Companies › Section R. 500.73 - Severability

Current through Vol. 24-12, July 15, 2024
Rule 3. If a provision of these rules, or the application of
				  these rules to a person or circumstance, is held invalid by a court of
				  competent jurisdiction, that determination does not affect other provisions or
				  applications of these rules that can be given effect without the invalid
				  provision or application, and to that end, the provisions of these rules are
				  severable.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Holding Companies › Section R. 500.74 - Forms; general requirements

Current through Vol. 24-12, July 15, 2024
Rule 4.
(1) The
				department shall make available forms, titled Form A, Form B, Form C, Form D,
				and Form F, that must be used to prepare the statements required under chapter
				13. The forms are not intended as blank forms to fill in. The statements filed
				must contain the numbers and captions of all items. The text of the items may
				be omitted, as long as the answers to the items clearly indicate the scope and
				coverage of each item. All instructions, whether appearing under the items of
				the form or elsewhere in the form, must be omitted. Unless expressly provided
				otherwise, if an item is inapplicable or the answer is in the negative, an
				appropriate statement to that effect must be made.
(2) One complete copy of each statement,
				including exhibits and all other papers and documents filed as part of the
				statement, must be filed with the director in a manner prescribed by the
				department. The copy must be signed in the manner prescribed on the form or
				otherwise prescribed by the department. If an individual or group of
				individuals are ultimate controlling persons, the individuals shall sign the
				Form A, Form B, Form C, and Form F statements. The director shall reject a copy
				that is not properly signed until it is conformed. If the signature of a person
				is affixed pursuant to a power of attorney or other similar authority, a copy
				of the power of attorney or other authority must be filed with the
				statement.
(3) Statements must be
				prepared electronically. Statements must be easily readable and suitable for
				review and reproduction. Debits in credit categories and credits in debit
				categories must be designated to make them clearly distinguishable on
				photocopies. Statements must be in the English language and monetary values
				must be stated in United States currency. If an exhibit or other paper or
				document filed with the statement is in a language other than English, it must
				be accompanied by a translation into the English language and a monetary value
				shown in a foreign currency must be converted into United States currency,
				unless the director allows the monetary value to be shown in a foreign
				currency.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Holding Companies › Section R. 500.75 - Forms; incorporation of information by reference; summaries and omissions

Current through Vol. 24-12, July 15, 2024
Rule 5.
(1)
				Information required by an item of Form A, Form B, Form D, or Form F may be
				incorporated by reference in an answer or partial answer to another item.
				Information contained in a financial statement, annual report, proxy statement,
				statement filed with a governmental authority, or another document may be
				incorporated by reference in an answer or partial answer to an item of Form A,
				Form B, Form D, or Form F, as long as the document is filed as an exhibit to
				the statement. Excerpts of documents may be filed as exhibits if the documents
				are extensive. Documents currently on file with the director that were filed
				within 3 years are not required to be attached as exhibits. References to
				information contained in exhibits or in documents already on file must clearly
				identify the material and specifically indicate that the material is
				incorporated by reference in the answer to the item. Material must not be
				incorporated by reference if the incorporation renders the statement
				incomplete, unclear, or confusing.
(2) If an item requires a summary or outline
				of the provisions of a document, only a brief statement must be made as to the
				pertinent provisions of the document. In addition to the statement, the summary
				or outline may incorporate by reference particular parts of an exhibit or
				document currently on file with the director that was filed within 3 years and
				may be qualified in its entirety by the reference. If 2 or more documents that
				must be filed as exhibits are substantially identical in all material respects,
				except as to the parties, the dates of execution, or other details, a copy of
				only 1 of the documents must be filed with a schedule identifying the omitted
				documents and setting forth the material details in which the documents differ
				from the documents that have a copy filed.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Holding Companies › Section R. 500.76 - Forms; information unknown or unavailable; extension

Current through Vol. 24-12, July 15, 2024
Rule 6.
(1) If it is
				impractical to furnish any required information, document, or report when it
				must be filed, a separate document must be filed with the director that does
				all of the following:
(a) Identifies the
				information, document, or report in question.
(b) States why filing the information,
				document, or report when required is impractical.
(c) Requests an extension of time for filing
				the information, document, or report to a specified date.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Holding Companies › Section R. 500.77 - Forms; additional information and exhibits

Current through Vol. 24-12, July 15, 2024
Rule 7. In addition to the information expressly required to
				  be included in Form A, Form B, Form C, Form D, and Form F, the director may
				  request additional material information as necessary to make the information
				  contained in the form not misleading. Exhibits may be filed in addition to
				  those expressly required by the statement. The exhibit must clearly indicate
				  the subject matter that it refers to. Changes to Form A, Form B, Form C, Form
				  D, or Form F must include on the top of the cover page the phrase: "Change No.
				  [insert number] to" and indicate the date of the change, not the date of the
				  original filing.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Holding Companies › Section R. 500.78 - Subsidiaries of domestic insurers

Current through Vol. 24-12, July 15, 2024
Rule 8. The authority to invest in subsidiaries under section
				  1341a of the act, MCL
				  500.1341a, is in addition to any
				  authority to invest in subsidiaries contained in another provision of the
				  act.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Holding Companies › Section R. 500.80 - Amendments to Form A

Current through Vol. 24-12, July 15, 2024
Rule 10. An applicant required to file Form A shall promptly
				  advise the director of changes in the information furnished on Form A arising
				  after the date the information was furnished but before the director's
				  disposition of the application.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Holding Companies › Section R. 500.81 - Acquisition of certain "domestic insurers"; Form A

Current through Vol. 24-12, July 15, 2024
Rule 11.
(1) If the
				person being acquired is determined to be a domestic insurer solely because of
				the provisions of section 1311(4) of the act, MCL
				500.1311, the name of the
				domestic insurer on the cover page must be indicated as follows:
"ABC Insurance Company, a subsidiary of XYZ Holding
				  Company."
(2) If a domestic
				insurer described section 1311(4) of the act, MCL
				500.1311, is being acquired, a
				reference to "the insurer" contained in Form A refers to both the domestic
				subsidiary insurer and the person being acquired.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Holding Companies › Section R. 500.82 - Annual registration of insurers; statement filing; Form B

Current through Vol. 24-12, July 15, 2024
Rule 12. An insurer required to file an annual registration
				  statement under section 1324 of the act, MCL
				  500.1324, shall furnish the
				  required information on Form B by May 1 of each year for the immediately
				  preceding calendar year, unless an extension is granted by the director under
				  section 1324 of the act, MCL
				  500.1324.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Holding Companies › Section R. 500.83 - Summary of changes to registration; statement filing; Form C

Current through Vol. 24-12, July 15, 2024
Rule 13. An insurer required to file an annual registration
				  statement under section 1324 of the act, MCL
				  500.1324, shall furnish the
				  required information on a summary of changes to registration statement, Form C,
				  by May 1 of each year for the immediately preceding calendar year, unless an
				  extension is granted by the director under section 1324 of the act, MCL
				  500.1324.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Holding Companies › Section R. 500.84 - Amendments to Form B

Current through Vol. 24-12, July 15, 2024
Rule 14.
(1) An
				amendment to Form B must be filed within 15 days after the end of a month in
				which there is a material change to the information provided in the annual
				registration statement.
(2)
				Amendments must be filed in the Form B format with only those items that are
				being amended reported. Each amendment must include "Amendment No. [insert
				number] to Form B for [insert year]" at the top of the cover page and indicate
				the date of the change, not the date of the original filings.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Holding Companies › Section R. 500.85 - Alternative and consolidated registrations

Current through Vol. 24-12, July 15, 2024
Rule 15.
(1) An
				authorized insurer may file a registration statement on behalf of an affiliated
				insurer or insurers that are required to register under section 1324 of the
				act, MCL 500.1324. A registration
				statement may include information not required by the act regarding an insurer
				in the insurance holding company system, even if the insurer is not authorized
				to do business in this state. Instead of filing a registration statement on
				Form B, the authorized insurer may file a copy of the registration statement or
				similar report that it must file in its state of domicile if both of the
				following are met:
(a) The statement or
				report contains substantially similar information required to be furnished on
				Form B.
(b) The filing insurer is
				the principal insurance company in the insurance holding company
				system.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Holding Companies › Section R. 500.86 - Disclaimer of affiliation and termination of registration

Current through Vol. 24-12, July 15, 2024
Rule 16.
(1) A
				petition for disclaimer of affiliation or a request for termination of
				registration claiming that a person does not, or will not upon the taking of
				some proposed action, control another subject person must contain the following
				information:
(a) The number of authorized,
				issued, and outstanding voting securities of the subject person.
(b) With respect to the person whose control
				is denied and all affiliates of that person, the number and percentage of
				shares of the subject person's voting securities that are held of record or
				known to be beneficially owned, and the number of shares there is a right to
				acquire, directly or indirectly.
(c) All material relationships and bases for
				affiliation between the subject person and the person whose control is denied
				and all affiliates of that person.
(d) A statement explaining why the person
				must not be considered to control the subject person.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Holding Companies › Section R. 500.87 - Transactions subject to prior notice; notice filing; Form D

Current through Vol. 24-12, July 15, 2024
Rule 17.
(1) An
				insurer required to give notice of a proposed transaction pursuant to section
				1341 of the act, MCL
				500.1341, shall furnish the
				required information on Form D.
(2)
				Agreements for cost sharing services and management services must, at a
				minimum, do all of the following, as applicable:
(a) Identify the person providing services
				and the nature of the services.
(b)
				Set forth the methods to allocate costs.
(c) Require timely settlement, not less
				frequently than on a quarterly basis, and compliance with the requirements in
				the NAIC Accounting Practices and Procedures Manual.
(d) Prohibit advancement of money by the
				insurer to the affiliate except to pay for services defined in the
				agreement.
(e) State that the
				insurer shall maintain oversight for functions provided to the insurer by the
				affiliate and that the insurer shall monitor services annually for quality
				assurance.
(f) Define books and
				records of the insurer to include all books and records developed or maintained
				under or related to the agreement.
(g) Specify that all books and records of the
				insurer are and remain the property of the insurer, held for the benefit of the
				insurer and are subject to the control of the insurer.
(h) State that all money and invested assets
				of the insurer are the exclusive property of the insurer, held for the benefit
				of the insurer and are subject to the control of the insurer.
(i) Include standards for termination of the
				agreement with and without cause.
(j) Include provisions for indemnification of
				the insurer if there is gross negligence or willful misconduct on the part of
				the affiliate providing the services.
(k) Specify that if the insurer is placed in
				receivership or seized by the director under chapter 81 of the act, MCL
				500.8101 to
				500.8160, all of the following
				apply:
(i) All of the rights of the insurer
				under the agreement extend to the receiver or director.
(ii) All books and records must immediately
				be made available to the receiver or the director and must be turned over to
				the receiver or director immediately upon the receiver's or director's
				request.
(l) Specify that
				the affiliate has no automatic right to terminate the agreement if the insurer
				is placed in receivership pursuant to chapter 81 of the act, MCL
				500.8101 to
				500.8159.
(m) Specify that the affiliate shall continue
				to maintain any systems, programs, or other infrastructure notwithstanding a
				seizure by the director under chapter 81 of the act, MCL
				500.8101 to
				500.8159, and shall make them
				available to the receiver, for so long as the affiliate continues to receive
				timely payment for services rendered.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Holding Companies › Section R. 500.88 - Enterprise risk report; Form F

Current through Vol. 24-12, July 15, 2024
Rule 18. The ultimate controlling person of an insurer
				  required to file an enterprise risk report pursuant to section 1325a of the
				  act, MCL 500.1325a, shall furnish the
				  required information on Form F.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Holding Companies › Section R. 500.89 - Group capital calculation

Current through Vol. 24-12, July 15, 2024
Rule 19.
(1) If an
				insurance holding company system has previously filed the annual group capital
				calculation at least once, the lead state commissioner has the discretion to
				exempt the ultimate controlling person from filing the annual group capital
				calculation if the lead state commissioner makes a determination based upon
				that filing that the insurance holding company system meets all of the
				following criteria:
(a) Has annual direct
				written and unaffiliated assumed premium, including international direct and
				assumed premium, but excluding premiums reinsured with the Federal Crop
				Insurance Corporation and Federal Flood Program, of less than
				$1,000,000,000.00.
(b) Has no
				insurers within its holding company structure that are domiciled outside of the
				United States or 1 of its territories.
(c) Has no banking, depository, or other
				financial entity that is subject to an identified regulatory capital framework
				within its holding company structure.
(d) The holding company system attests that
				there are no material changes in the transactions between insurers and
				non-insurers in the group that have occurred since the last filing of the
				annual group capital calculation.
(e) The non-insurers within the holding
				company system do not pose a material financial risk to the insurer's ability
				to honor policyholder obligations.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Holding Companies › Section R. 500.90 - Extraordinary dividends and reporting of all dividends

Current through Vol. 24-12, July 15, 2024
Rule 20.
(1) Requests
				for approval of extraordinary dividends or another extraordinary distribution
				to shareholders must include all of the following:
(a) The amount of the proposed
				dividend.
(b) The date established
				for payment of the dividend.
(c) A
				statement as to whether the dividend is to be in cash or other property and, if
				in property, a description of the property, its cost, and its fair market value
				together with an explanation of the basis for valuation.
(d) A copy of the calculations determining
				whether the proposed dividend is extraordinary. The work paper must include all
				of the following information:
(i) The amounts,
				dates, and form of payment of all dividends or distributions, including regular
				dividends but excluding distributions of the insurers own securities, paid
				within the period of 12 consecutive months ending on the date fixed for payment
				of the proposed dividend for which approval is sought and commencing on the day
				after the same day of the same month in the last preceding year.
(ii) Surplus as regards policyholders, which
				is the total capital and surplus, as of the preceding December 31.
(iii) If the insurer is a life insurer, the
				net gain from operations for the 12-month period ending the preceding December
				31.
(iv) If the insurer is not a
				life insurer, the net income less realized capital gains for the 12-month
				period ending the preceding December 31 and the 2 preceding 12-month
				periods.
(v) If the insurer is not
				a life insurer, the dividends paid to stockholders excluding distributions of
				the insurer's own securities in the preceding 2 calendar years.
(e) A balance sheet and statement
				of income for the period intervening from the last annual statement filed with
				the director and the end of the month preceding the month in which the request
				for dividend approval is submitted.
(f) A brief statement as to the effect of the
				proposed dividend upon the insurer's surplus and the reasonableness of surplus
				in relation to the insurer's outstanding liabilities and the adequacy of
				surplus relative to the insurer's financial needs.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Holding Companies › Section R. 500.91 - Adequacy of Surplus

Current through Vol. 24-12, July 15, 2024
Rule 21. The factors set forth in sections 403, 436a, 1341,
				  1342, and 1343 of the act, MCL
				  500.403,
				  500.436a,
				  500.1341,
				  500.1342, and
				  500.1343, are not an exhaustive
				  list. In determining the adequacy and reasonableness of an insurer's surplus,
				  no single factor is necessarily controlling. Instead, the director considers
				  the net effect of all of these factors, plus other factors bearing on the
				  financial condition of the insurer. In comparing the surplus maintained by
				  other insurers, the director considers the extent to which each of these
				  factors varies from company to company, and in determining the quality and
				  liquidity of investments in subsidiaries, the director considers the individual
				  subsidiary and may discount or disallow its valuation to the extent that the
				  individual investments warrant.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Captive Insurance Company Rules › Section R. 500.101 - Definitions

Current through Vol. 24-12, July 15, 2024
Rule 1. As used in these rules:
(a) "Act" means the insurance code of 1956,
				1956 PA 218, MCL 500.100 to 500.8302.
(b) "Captive insurance company" means a
				captive insurance company as defined in section 4601 of the act, a special
				purpose financial captive as defined in section 4701 of the act, or a protected
				cell company as defined in section 4801 of the act.
(c) "Captive manager" means any person
				entering into a contract with a captive insurance company, or the parent or
				affiliate of a captive insurance company, for the purpose of managing the
				operations of the captive insurance company.
(d) "Director" means the director of the
				department of insurance and financial services unless otherwise
				noted.
(e) "Limited certificate of
				authority" means a limited certificate of authority issued by the director
				pursuant to chapter 46 or 47 of the act, MCL 500.4601 to 500.4673, MCL 500.4701
				to 500.4747.
(f) "Person" means an
				individual, corporation, limited liability company, association, partnership,
				limited partnership, limited liability partnership, trust, business trust,
				entity, unincorporated organization, joint venture, or other legal or
				commercial entity.
(g) Terms
				defined in the insurance code of 1956, 1956 PA 218, MCL 500.100 to MCL
				500.8302, have the same meanings when used in these rules.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Captive Insurance Company Rules › Section R. 500.102 - Severability

Current through Vol. 24-12, July 15, 2024
Rule 2. If a provision of a rule or the application of a rule
				  to any person or circumstance is held invalid by a court of competent
				  jurisdiction, then the provision or application shall not affect other
				  provisions that can be given effect without the invalid provision or
				  application.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Captive Insurance Company Rules › Section R. 500.104 - Record retention

Current through Vol. 24-12, July 15, 2024
Rule 4.
(1) Each
				captive insurance company shall maintain, in a place secure from theft, loss,
				or destruction, the financial, investment, and business records of the captive
				insurance company. The records shall include accurate, complete, legible, and
				permanent records, in electronic or hard copy format, of any books, records,
				data, or documents pertaining to, prepared, or generated by the captive
				insurance company, including, but not limited to, all of the following:
(a) Accounting records.
(b) Actuarial reports and studies.
(c) Audits and auditor management
				letters.
(d) Board, shareholder,
				member, audit, and claim committee meeting minutes.
(e) Captive insurance company formation
				documents.
(f) Claims
				records.
(g)
				Correspondence.
(h) Computer
				generated data.
(i)
				Contracts.
(j) Coverage
				applications, forms, and policies.
(k) Internal audit records.
(l) Investment records.
(m) Loss prevention plans.
(n) Segregated cell formation, financial,
				investment, and claims documents.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Captive Insurance Company Rules › Section R. 500.105 - Captive manager

Current through Vol. 24-12, July 15, 2024
Rule 5.
(1) A
				captive insurance company desiring to utilize a captive manager shall ensure
				that the captive manager has submitted to the director for approval a complete
				captive manager application in a form prescribed by the director.
(2) A captive insurance company may utilize
				only a captive manager whose captive manager application has been approved by
				the director. A captive insurance company shall do both of the following:
(a) Submit a copy of the captive manager
				contract to the director.
(b)
				Ensure that the captive manager contract states that a captive manager is
				subject to the control of the captive insurance companys board of directors or
				other supervisory management body.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Captive Insurance Company Rules › Section R. 500.106 - Audited financial statements

Current through Vol. 24-12, July 15, 2024
Rule 6.
(1) No later
				than 5 months after the fiscal year end of the captive insurance company, the
				captive insurance company shall file with the director audited financial
				statements of the captive insurance company prepared by an independent
				certified public accountant.
(2) An
				independent certified public accountants audit of a captive insurance company
				shall include the following:
(a) The
				independent certified public accountants opinion covering all years under
				audit. The opinion shall be addressed to the captive insurance company on the
				independent certified public accountants stationary, shall bear the original
				handwritten signature of the independent certified public accountant, and shall
				be dated.
(b) A report of
				evaluation of the internal controls of the captive insurance company. This
				report shall include an evaluation of the internal controls of the company
				relating to the methods and procedures used in the securing of assets and the
				reliability of the financial records.
(c) An independent certified public
				accountants letter stating the independent certified public accountant is all
				of the following:
(i) Independent with respect
				to the captive insurance company and conforms to the standard of the profession
				as contained in the code of professional ethics and pronouncements of the
				American institute of certified public accountants and pronouncements of the
				financial accounting standards board.
(ii) Properly licensed by an appropriate
				state regulatory authority or similar regulatory authority.
(iii) A member in good standing with the
				American institute of certified public accountants or similar
				organization.
(iv) The general
				background and experience of the staff engaged in the audit, including the
				staffs experience in auditing captive and other insurance companies.
(v) The independent certified public
				accountant agrees to make the audit work papers available to the director or
				the directors designee.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Captive Insurance Company Rules › Section R. 500.107 - Scope of approval of certificate of authority

Current through Vol. 24-12, July 15, 2024
Rule 7. If the director approves a captive insurance company
				  limited certificate of authority application, the approval is only for the
				  applicants qualification for the limited certificate of authority. The approval
				  does not indicate or suggest that the director has considered, opined on, or
				  approved any of the following:
(a) The
				qualifications or application of the applicant for any other purpose.
(b) Additional captive special purpose
				securitizations proposed by a special purpose financial captive.
(c) Protected cells not authorized by the
				certificate of authority granted to the applicant.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Captive Insurance Company Rules › Section R. 500.108 - Duty to disclose changes in information

Current through Vol. 24-12, July 15, 2024
Rule 8. The holder of a limited certificate of authority has
				  an ongoing duty to promptly disclose any material changes in information to the
				  director as soon as the holder of the limited certificate of authority becomes
				  aware of the change. The holder of a limited certificate of authority shall
				  submit to the director for review and approval before implementation of the
				  following:
(a) Any material
				modifications to the captives plan of operation.
(b) Any proposed new special purpose
				securitization proposed by a special purpose financial captive.
(c) Any new protected cell
				programs.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Captive Insurance Company Rules › Section R. 500.109 - Obligation to report certain events

Current through Vol. 24-12, July 15, 2024
Rule 9. An applicant for a limited certificate of authority
				  and the holder of a limited certificate of authority shall provide written
				  notice to the director at the time the applicant or holder becomes aware of any
				  of the following:
(a) Any change in
				the officers, directors, or managers of the captive insurance
				company.
(b) Insolvency or
				impairment of capital or retained earnings.
(c) Failure to meet the requirements of
				section 4611 of the act, MCL 500.4611, if applicable.
(d) The suspension or revocation of the
				certificate of authority or equivalent authorization of a branch captive
				insurance company in the jurisdiction in which the company was
				formed.
(e) A captive insurance
				company that is a limited liability company is no longer in good standing under
				section 207a of 1993 PA 23, MCL 450.4207a.
(f) The captive insurance company fails to
				remove or discharge an officer or director of the company within 30 days after
				the director of the department of insurance and financial services makes a
				written request that the officer or director of the company should be removed
				or discharged.
(g) The captive
				insurance company fails to pay any final judgment rendered against it in this
				state on any policy, bond, recognizance, or undertaking issued or guaranteed by
				it within a reasonable period of time after entry of the final
				judgment.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Captive Insurance Company Rules › Section R. 500.110 - Investigative hearings

Current through Vol. 24-12, July 15, 2024
Rule 10.
(1) The
				director may initiate an investigation, undertake an examination, or take such
				other action as the director, in the exercise of discretion, determines is
				necessary or appropriate to assure the holder of a limited certificate of
				authority complies with all applicable provisions of the act.
(2) The director may conduct hearings for any
				of the following:
(a) To investigate an
				applicant, an application, or a holder of a limited certificate of
				authority.
(b) To gather
				information in furtherance of acting on an application for a limited
				certificate of authority.
(c) To
				investigate alleged violations of the applicable provisions of the act or these
				rules by a holder of a limited certificate of authority.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › Captive Insurance Company Rules › Section R. 500.111 - Limited certificate of authority as a revocable privilege

Current through Vol. 24-12, July 15, 2024
Rule 11. The holder of a limited certificate of authority has
				  an ongoing duty to comply with all applicable provisions of the act. A limited
				  certificate of authority is not a property right, but is a revocable privilege
				  contingent upon compliance with all applicable provisions of the act and
				  regulations promulgated thereunder.
Michigan Administrative Code › Department - Insurance and Financial Services › Insurance › No-Fault Fee Schedule › Section R. 500.201 - Definitions

Current through Vol. 24-12, July 15, 2024
Rule 1.
As used in these rules:
(a) "Act" means the insurance code of 1956,
				1956 PA 218, MCL 500.100 to 500.8302.
(b) "Charge description master" means that
				term as defined in section 3157(15)(a) of the act, MCL 500.3157.
(c)"Department" means the department of
				insurance and financial services.
(d) "Director" means the director of the
				department.
(e) "Medicare" means
				that term as defined in section 3157(15)(f) of the act, MCL 500.3157.
(f) "Neurological rehabilitation clinic"
				means that term as defined in section 3157(15)(g) of the act, MCL
				500.3157.
(g) "Provider" means a
				physician, hospital, clinic, or other person lawfully rendering a service to an
				injured person.
(h) "Fee schedule"
				means, as applicable, the Medicare fee schedule or prospective payment system
				in effect on March 1 of the service year in which the service is rendered and
				for the area in which the service was rendered. The applicable fee schedule
				applies to services rendered during that service year, notwithstanding any
				subsequent change made to the fee schedule.
(i) "Service" means "treatment," as that term
				is defined in section 3157(15)(k) of the act, MCL 500.3157, and also includes
				training and rehabilitative occupational training, as described in section 3157
				of the act, MCL 500.3157.
(j)
				"Service year" means the period from July 2 through July 1 of the following
				year.