(3) Expense provisions for each other category of expenses must be reasonably allocated
among classifications based on losses, coverages, exposures, or other basis that equitably
measures the variations, if any, in the manner in which those expenses are anticipated to be
incurred with respect to the classifications. Expense allocation methods may include percentage-
of-premium, uniform-per-coverage, uniform-per-exposure, or other basis, as appropriate and
justified.
History: 1981 AACS; 2021 MR 6, Eff. Mar 24, 2021.
R 500.1508
Complaint-resolution process; notice of rights; private informal
managerial-level conference.
Rule 8. (1) At the time of a denial of automobile insurance or home insurance, the insurer or
producer making the denial shall provide the person subject to the denial written notice of his or
her right to submit a complaint and to have a private informal managerial-level conference if he
or she has reason to believe that the denial is improper.
(2) If a person has reason to believe that he or she has been charged in incorrect premium
and informs the insurer or producer of that belief, the insurer or producer shall promptly provide
the person written notice of his or her right to submit a complaint and to have a private informal
managerial-level conference.
(3) The written notices required under subrule (1) and (2) of this rule must be in language
understandable to a person of ordinary intelligence and must include, but need not be limited to,
an explanation of all of the following:
(a) The person’s right to submit a complaint and the procedure the person shall follow if he
or she wishes to submit a complaint.
(b) The person’s right to be provided information pertinent to the denial or premium charge
upon request, subject to payment of a reasonable copying charge. An insurer’s reasonable
copying charge under this subdivision must not exceed the rate charged for copying by the
department in accordance with the freedom of information act, 1976 PA 442, MCL 15.231 to
15.246. The director shall inform insurers of that maximum allowable copying charge on an
annual basis.
(c) The person’s right to a private informal managerial-level conference addressing the
complaint with the insurer, the procedure the person shall follow if he or she wishes to request a
private informal managerial-level conference, and the process applicable to a private informal
managerial-level conference. All of the following apply to that process:
(i) If a private informal managerial-level conference is requested, the conference and
proposed resolution must be provided by the insurer within 30 days after the date of the person’s
request.
(ii) The private informal managerial-level conference may be held by telephone, video
teleconference or other substantially similar electronic means, or in-person, as long as the
following requirements are met:
(A) If the conference is held by telephone or video teleconference or other substantially
similar electronic means, the insurer shall state at the beginning of the conference that it is a
private informal managerial-level conference and identify all persons by name and title who are
listening to, or otherwise participating in, the conference. In addition, the insurer shall either
provide a toll-free telephone service or other service at no cost to the person making the
complaint, or pay all charges associated with the conference. As applicable, the written notice
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