SB-0898, As Passed Senate, May 30, 2018

 

 

 

 

 

 

 

 

 

 

 

 

SENATE BILL No. 898

 

 

March 8, 2018, Introduced by Senator HUNE and referred to the Committee on Insurance.

 

 

     A bill to amend 1956 PA 218, entitled

 

"The insurance code of 1956,"

 

by amending section 4621 (MCL 500.4621), as added by 2008 PA 29.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 4621. (1) A captive insurance company shall is not be

 

required to make an annual report except as provided in this

 

chapter.

 

     (2) Annually, on or before March 1 of each year, a not later

 

than 60 days after the end of a captive insurance company's fiscal

 

year, the captive insurance company shall submit to the

 

commissioner director a report of its financial condition, verified

 

by oath of 2 of its executive officers. A captive insurance company

 

may report using generally accepted accounting principles or, with


the approval of the commissioner, director, international financial

 

reporting standards or statutory accounting principles, with useful

 

or necessary modifications or adaptations required or approved or

 

accepted by the commissioner director for the type of insurance and

 

kinds of insurers to be reported upon, on, and as supplemented by

 

additional information required by the commissioner. director. The

 

commissioner director may prescribe the form and manner in which

 

captive insurance companies shall report. Information submitted

 

pursuant to under this section is confidential as provided in

 

section 4609.

 

     (3) The commissioner director may address inquiries to any a

 

captive insurer concerning the insurer's activities or conditions

 

or any other matter connected with the insurer's transactions. An

 

insurer so addressed under this subsection shall reply in writing

 

to each inquiry from the commissioner director within 30 days of

 

after receipt of the inquiry.

 

     (4) The commissioner director may require interim reporting on

 

any or all of the captive insurer's business, including any matter,

 

condition, or requirement regulated by this chapter. The

 

commissioner director shall prescribe the format and content of the

 

interim report.

 

     (5) Each A captive insurer that fails to file a report

 

required by this section, or fails to reply within 30 days to an

 

inquiry of the commissioner, director, is subject to a civil

 

penalty of not less than $1,000.00 or more than $5,000.00 per

 

occurrence, and an additional $50.00 for every day that the captive

 

insurer fails to file the report or reply to the inquiry. In


addition, each a captive insurer that fails to file a report, or

 

fails to make a satisfactory reply to an inquiry of the

 

commissioner director concerning the captive insurer's affairs, is

 

subject to proceedings under section 4637.

 

     (6) A pure captive insurance company may make written

 

application for filing the annual report on a fiscal year end that

 

is consistent with the parent company's fiscal year. The annual

 

report shall must be on a form prescribed by the

 

commissioner.director.

 

     (7) A branch captive insurance company shall file with the

 

commissioner director 60 days after the fiscal year end a copy of

 

all reports and statements required to be filed under the laws of

 

the jurisdiction in which the alien captive insurance company is

 

formed, verified by oath by 2 of its executive officers. If the

 

commissioner director is satisfied that the annual report filed by

 

the alien captive insurance company in its domiciliary jurisdiction

 

provides adequate information concerning the financial condition of

 

the alien captive insurance company, the commissioner director may

 

waive the requirement for completion of the captive annual

 

statement.

 

     (8) A captive insurance company shall annually submit to the

 

commissioner director the opinion of a qualified actuary as to

 

whether the reserves and related actuarial items held in support of

 

the reserves are computed appropriately, are based on assumptions

 

that satisfy contractual provisions, are consistent with prior

 

reported amounts, and comply with applicable laws of this state.

 

The actuarial opinion required by this section shall must be


submitted in a form prescribed by the commissioner. director. For

 

purposes of this section, "qualified actuary" means a member of

 

either the American academy Academy of actuaries Actuaries or the

 

society Society of actuaries Actuaries who also meets any other

 

criteria that the commissioner director may establish by rule,

 

regulation, or order.