Michigan Office of Administrative Hearings and Rules
Administrative Rules Division (ARD)
AGENCY REPORT TO THE
JOINT COMMITTEE ON ADMINISTRATIVE RULES (JCAR)
AGENCY INFORMATION:
Agency name:
Insurance and Financial Services
Division/Bureau/Office:
Insurance
Name of person completing this form:
Julie Merriman
Phone number of person completing this form:
517-284-8787
Email of person completing this form:
Name of Department Regulatory Affairs Officer reviewing this form:
Jeff Hayden
RULE SET INFORMATION:
MOAHR assigned rule set number:
2023-64 IF
Title of the proposed rule set:
Term and Universal Life Insurance Reserve Financing
1. Purpose of the proposed rules and background:
The proposed rules govern reserve financing arrangements used by certain life insurers in reinsurance transactions to
secure the reinsurance treaty or capitalize the reinsurer in order to meet statutory reserve requirements. The
proposed rules ensure that funds backing these transactions are held in the appropriate form and level of security.
The proposed rules would adopt Model Regulation #787 of the National Association of Insurance Commissioners
(NAIC). The Department currently implements substantially similar requirements through review of financial
statements filed with the Department pursuant to the Director’s order issued under MCL 500.438 of the Insurance
Code of 1956. The NAIC has adopted the Model Regulation as a state insurance department accreditation standard.
Accordingly, the proposed rules would also assist in establishing uniform, national standards for the reserve financing
arrangements subject to the rules and ensure that the Department maintains its accreditation status.
2. Summary of the proposed rules:
The proposed rules govern reserve financing arrangements used by certain life insurers in reinsurance transactions to
secure the reinsurance treaty or capitalize the reinsurer. The proposed rules ensure that funds backing these
transactions are held in the appropriate form and level of security. The proposed rules would adopt Model Regulation
#787 of the National Association of Insurance Commissioners.
3. List names of newspapers in which the notice of public hearing was published and publication
dates:
Escanaba Daily Press (May 15, 2024); Lansing State Journal (May 15, 2024); Detroit Free Press (May 15, 2024).
4. Date of publication of the proposed rules and notice of public hearing in the Michigan Register:
5/15/2024
5. Date, time, and location of the public hearing:
MCL 24.242 and 24.245