DEPARTMENT OF INSURANCE AND FINANCIAL SERVICES  
INSURANCE  
HOLDING COMPANIES  
(By authority conferred on the director of the department of insurance and financial services by  
sections 210 and 1361 of the insurance code of 1956, 1956 PA 218, MCL 500.210 and 500.1361,  
and Executive Reorganization Order No. 2013-1, MCL 550.991)  
R 500.71 Definitions.  
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.  
(2) A term defined in the act has the same meaning when used in these rules, unless a more  
specific definition of a term is provided under chapter 13, in which case the term defined in chapter  
13 has the same meaning when used in these rules. A term not defined in the act has meaning  
according to industry usage when used in these rules.  
History: 2024 AACS.  
R 500.72 Purpose.  
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.  
History: 2024 AACS.  
R 500.73 Severability.  
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.  
History: 2024 AACS.  
R 500.74 Forms; general requirements.  
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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.  
History: 2024 AACS.  
R 500.75 Forms; incorporation of information by reference; summaries and omissions.  
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  
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setting forth the material details in which the documents differ from the documents that have a  
copy filed.  
History: 2024 AACS.  
R 500.76 Forms; information unknown or unavailable; extension.  
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.  
(2) The request in subrule (1)(c) of this rule is considered granted unless the director denies the  
request within 60 days after receipt of the request.  
History: 2024 AACS.  
R 500.77 Forms; additional information and exhibits.  
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.  
History: 2024 AACS.  
R 500.78 Subsidiaries of domestic insurers.  
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.  
History: 2024 AACS.  
R 500.79 Acquisition of control; statement filing; Form A.  
Rule 9. A person required to file a statement under section 1311 of the act, MCL 500.1311, shall  
furnish the required information on Form A.  
History: 2024 AACS.  
R 500.80 Amendments to Form A.  
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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.  
History: 2024 AACS.  
R 500.81 Acquisition of certain “domestic insurers”; Form A.  
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.  
History: 2024 AACS.  
R 500.82 Annual registration of insurers; statement filing; Form B.  
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.  
History: 2024 AACS.  
R 500.83 Summary of changes to registration; statement filing; Form C.  
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.  
History: 2024 AACS.  
R 500.84 Amendments to Form B.  
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.  
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History: 2024 AACS.  
R 500.85 Alternative and consolidated registrations.  
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.  
(2) The question of whether the filing insurer is the principal insurance company in the insurance  
holding company system is a question of fact, and an insurer filing a registration statement or  
report instead of Form B on behalf of an affiliated insurer shall set forth a brief statement of facts  
that substantiate the filing insurer’s claim that it, in fact, is the principal insurer in the insurance  
holding company system.  
(3) With the prior approval of the director, an unauthorized insurer may follow any of the  
procedures that could be done by an authorized insurer under subrule (1) of this rule.  
(4) An insurer may take advantage of the provisions of section 1329 or 1330 of the act, MCL  
500.1329 and 500.1330, without obtaining the prior approval of the director. The director reserves  
the right to require individual filings if the director finds the filings necessary in the interest of  
clarity, ease of administration, or the public good.  
History: 2024 AACS.  
R 500.86 Disclaimer of affiliation and termination of registration.  
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.  
(2) The burden of proof for establishing that an affiliation does not exist rests with the petitioner  
and is subject to the director’s approval.  
History: 2024 AACS.  
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R 500.87 Transactions subject to prior notice; notice filing; Form D.  
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.  
History: 2024 AACS.  
R 500.88 Enterprise risk report; Form F.  
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.  
History: 2024 AACS.  
R 500.89 Group capital calculation.  
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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.  
(2) 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 accept instead of the  
group capital calculation a limited group capital filing if both of the following apply:  
(a) The insurance holding company system 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) All of the following additional criteria are met:  
(i) Has no insurers within its holding company structure that are domiciled outside of the United  
States or 1 of its territories.  
(ii) Does not include a banking, depository, or other financial entity that is subject to an  
identified regulatory capital framework.  
(iii) The holding company system attests that there are no material changes in transactions  
between insurers and non-insurers in the group that have occurred since the last filing of the report  
to the lead state commissioner and the non-insurers within the holding company system do not  
pose a material financial risk to the insurer’s ability to honor policyholder obligations.  
(3) For an insurance holding company that has previously met an exemption with respect to the  
group capital calculation pursuant to subrule (1) or (2) of this rule, the lead state commissioner  
may require at any time the ultimate controlling person to file an annual group capital calculation,  
completed in accordance with the group capital calculation instructions, if any of the following  
criteria are met:  
(a) An insurer within the insurance holding company system is in a risk-based capital action  
level event, as prescribed by the director in an order issued under section 438 of the act, MCL  
500.438, or otherwise prescribed by the director, or a similar standard for a non-United States  
insurer.  
(b) An insurer within the insurance holding company system meets 1 or more of the standards  
of an insurer determined to be in hazardous financial condition as established under section 436a  
of the act, MCL 500.436a.  
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(c) An insurer within the insurance holding company system otherwise exhibits qualities of a  
troubled insurer as determined by the lead state commissioner based on unique circumstances  
including, but not limited to, the type and volume of business written, ownership and  
organizational structure, federal agency requests, and international supervisor requests.  
(4) A non-United States jurisdiction is considered to recognize and accept the group capital  
calculation if it satisfies the following criteria:  
(a) With respect to an exemption described under section 1325b(3)(d) of the act, MCL  
500.1325b, either of the following:  
(i) The non-United States jurisdiction recognizes the United States state regulatory approach to  
group supervision and group capital, by providing confirmation by a competent regulatory  
authority, in that jurisdiction, that insurers and insurance groups whose lead state is accredited by  
the NAIC under the NAIC Accreditation Program are subject only to worldwide prudential  
insurance group supervision including worldwide group governance, solvency and capital, and  
reporting, as applicable, by the lead state and shall not be subject to group supervision, including  
worldwide group governance, solvency and capital, and reporting, at the level of the worldwide  
parent undertaking of the insurance or reinsurance group by the non-United States jurisdiction.  
(ii) Where no United States insurance groups operate in the non-United States jurisdiction, that  
non-United States jurisdiction indicates formally in writing to the lead state with a copy to the  
International Association of Insurance Supervisors that the group capital calculation is an  
acceptable international capital standard. This serves as the documentation otherwise required in  
paragraph (i) of this subdivision.  
(b) The non-United States jurisdiction provides confirmation by a competent regulatory authority  
in that jurisdiction that information regarding insurers and their parent, subsidiary, or affiliated  
entities, if applicable, must be provided to the lead state commissioner in accordance with a  
memorandum of understanding or similar document between the commissioner and that  
jurisdiction, including, but not limited to, the International Association of Insurance Supervisors  
Multilateral Memorandum of Understanding or other multilateral memoranda of understanding  
coordinated by the NAIC. The commissioner shall determine, in consultation with the NAIC  
Committee Process, if the requirements of the information sharing agreements are in force.  
(5) A list of non-United States jurisdictions that recognize and accept the group capital calculation  
must be published through the NAIC Committee Process as follows:  
(a) A list of jurisdictions that recognize and accept the group capital calculation pursuant to  
section 1325b(3)(d) of the act, MCL 500.1325b, is published through the NAIC Committee  
Process to assist the lead state commissioner in determining which insurers shall file an annual  
group capital calculation. The list must clarify those situations in which a jurisdiction is exempted  
from filing under section 1325b(3)(d) of the act, MCL 500.1325b. To assist with a determination  
under section 1325b(4) of the act, MCL 500.1325b, the list must also identify whether a  
jurisdiction that is exempted under either sections 1325b(3)(c) and (d) of the act, MCL 500.1325b,  
requires a group capital filing for a United States based insurance group’s operations in that non-  
United States jurisdiction.  
(b) For a non-United States jurisdiction where no United States insurance groups operate, the  
confirmation provided to meet the requirement of subrule (4)(a)(ii) of this rule serves as support  
for recommendation to be published as a jurisdiction that recognizes and accepts the group capital  
calculation through the NAIC Committee Process.  
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(c) If the lead state commissioner makes a determination pursuant to section 1325b(3)(d) of the  
act, MCL 500.1325b, that differs from the NAIC List, the lead state commissioner shall provide  
thoroughly documented justification to the NAIC and other states.  
(d) Upon determination by the lead state commissioner that a non-United States jurisdiction no  
longer meets 1 or more of the requirements to recognize and accept the group capital calculation,  
the lead state commissioner may provide a recommendation to the NAIC that the non-United  
States jurisdiction be removed from the list of jurisdictions that recognize and accepts the group  
capital calculation.  
History: 2024 AACS.  
R 500.90 Extraordinary dividends and reporting of all dividends.  
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.  
(2) Subject to section 1343(4) of the act, MCL 500.1343, a domestic insurer that is a member of  
an insurance holding company system and declares a shareholder dividend shall report the  
dividend to the director within 5 business days after declaring the dividend and not less than 10  
business days before the payment.  
(3) Subject to section 1343(5) of the act, MCL 500.1343, an insurer subject to registration under  
section 1324 of the act, MCL 500.1324, shall not pay an extraordinary dividend or make another  
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extraordinary distribution to its shareholders until 30 days after the director has received notice of  
the declaration and has not disapproved or has approved the payment within that period.  
(4) All filings pursuant to section 1343 of the act, MCL 500.1343, that either report the  
declaration of all dividends before payment or request approval of an extraordinary dividend must  
be directed to the attention of the Office of Insurance Financial and Market Regulation.  
History: 2024 AACS.  
R 500.91 Adequacy of Surplus.  
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.  
History: 2024 AACS.  
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;