Bill Text: MI HB4354 | 2015-2016 | 98th Legislature | Engrossed
Bill Title: Insurance; insurers; confidentiality of certain required filings by insurers; provide for. Amends secs. 2021, 2108, 2112, 2406, 2458, 2606 & 2652 of 1956 PA 218 (MCL 500.2021 et seq.).
Spectrum: Bipartisan Bill
Status: (Passed) 2015-10-14 - Assigned Pa 141'15 With Immediate Effect [HB4354 Detail]
Download: Michigan-2015-HB4354-Engrossed.html
HB-4354, As Passed Senate, September 30, 2015
SUBSTITUTE FOR
HOUSE BILL NO. 4354
A bill to amend 1956 PA 218, entitled
"The insurance code of 1956,"
by amending sections 2021, 2108, 2112, 2406, 2458, 2606, and 2652
(MCL 500.2021, 500.2108, 500.2112, 500.2406, 500.2458, 500.2606,
and 500.2652), section 2021 as added by 1982 PA 7, section 2112 as
amended by 2012 PA 454, section 2406 as amended by 1993 PA 200, and
section 2458 as amended by 1988 PA 262.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 2021. An unfair method of competition and an unfair or
deceptive act or practice in the business of insurance includes
failure
by a rating organization and an insurer which that makes
its own rates, within a reasonable time after receiving written
request
therefor for the
information and upon on payment
of such a
reasonable
charge, as it may make, to furnish to any an insured
affected by a rate made by it, or to the insured authorized
representative, of
such insured, all pertinent information to such
the rate. Pertinent information under this section does not include
information that is a trade secret as determined by the director
under section 2108(5) or 2406(6).
Sec. 2108. (1) On the effective date thereof,
each insurer
shall
file with the commissioner every of
a manual of
classification,
every manual of rules and rates, every rating plan,
and
every or modification of a manual of classification, manual
of
rules
and rates, or a rating plan which it that an insurer proposes
to
use for automobile insurance and or home insurance, the insurer
shall
file the manual or plan with the director.
Each filing shall
under this subsection must state the character and extent of the
coverage
contemplated. Each An insurer that
is subject to this
chapter
who and that maintains rates in any part of this state
shall at all times maintain rates in effect for all eligible
persons meeting the underwriting criteria of the insurer.
(2) An insurer may satisfy its obligation to make filings
under subsection (1) by becoming a member of, or a subscriber to, a
rating organization licensed under chapter 24 or
chapter 26 which
that makes
those the filings, and by filing with the commissioner
director a copy of its authorization of the rating organization to
make those the filings on its behalf. Nothing
contained in this
This chapter
shall be construed as requiring any does not require
an insurer
to become a member of or a subscriber to any a rating
organization. Insurers An insurer may file and use deviations from
filings made on their its behalf. ,
which The deviations shall be
are subject
to the provisions of this chapter.
(3) Each A filing shall under this section must be accompanied
by a certification by or on behalf of the insurer that, to the best
of its the insurer's information
and belief, the filing conforms to
the requirements of this chapter.
(4) Each A filing shall under this section must include
information that supports the filing with respect to the
requirements of section 2109. The information may include 1 or more
of the following:
(a) The experience or judgment of the insurer or rating
organization making the filing.
(b) The interpretation of the insurer or rating organization
of any statistical data it relies upon.on.
(c) The experience of other insurers or rating organizations.
(d) Any other relevant information.
(5) A Except as otherwise provided in this subsection, the
department shall make a filing under this section and any
accompanying information shall be open to
public inspection upon on
filing. An insurer or a rating organization filing on the insurer's
behalf may designate information included in the filing or any
accompanying information as a trade secret. The insurer or the
rating organization filing on behalf of the insurer shall
demonstrate to the director that the designated information is a
trade secret. If the director determines that the information is a
trade secret, the information is not subject to public inspection
and is exempt from the freedom of information act, 1976 PA 442, MCL
15.231 to 15.246. As used in this subsection, "trade secret" means
that term as defined in section 2 of the uniform trade secrets act,
House Bill No. 4354 as amended September 17, 2015
1998 PA 448, MCL 445.1902. <<However, trade secret does not include
filings and information accompanying filings under this section that
were subject to public inspection before the effective date of the
amendatory act that added this sentence.>>
(6) An insurer shall not make, issue, or renew a contract or
policy
except in accordance with filings which that are in effect
for
the insurer pursuant to under
this chapter.
Sec.
2112. (1) At Subject to
subsection (3), at least
annually, in conjunction with a renewal notice, a bill, or other
notice of payment due issued to a policyholder in conjunction with
an automobile or home insurance contract, an insurer shall send to
the policyholder a written notice that all of the following
information is available and will be provided to the policyholder
on request:
(a) A description of the specific rating classifications by
which the rates and premiums for the policy have been determined.
The
notice shall must be of sufficient detail and clarity so that
the policyholder can reasonably verify the applicability and
accuracy of the rating classifications.
(b) A general explanation of the extent to which rates or
premiums vary among policyholders on the basis of the rating
classifications used by the insurer.
(c) Sources and reasonable procedures by which the
policyholder can obtain from the insurer additional information
sufficient for the policyholder to calculate and confirm the
accuracy of his or her specific premium.
(d) Relevant information regarding the rights of the
policyholder, under sections 2113 and 2114, to appeal the
application of the insurer's rating plan in determining his or her
premium, to obtain documentation from the insurer regarding the
determination of the rate, to appeal the application of the
insurer's underwriting rules to the policyholder, to request an
informal conference with the insurer, and to file with the
commissioner
director a complaint as an aggrieved person.
(e) A description of all of the insurer's underwriting rules
based on insurance eligibility points and a description of all of
the underwriting rules of the insurer's affiliates based on
insurance eligibility points.
(f) A suggestion that the policyholder contact his or her
agent to determine if he or she is eligible for insurance from an
affiliate of the insurer or under a different rating plan of the
insurer that would provide to the policyholder insurance at a more
favorable premium.
(2) In a written notice provided under subsection (1), the
insurer shall provide the policyholder with a telephone number and
an
internet Internet address, by either of which the policyholder
may contact the insurer to request the information listed in
subsection (1). On request of the policyholder, the insurer shall
provide the policyholder with the requested information in either a
written or electronic format, as requested by the policyholder.
(3) An insurer is not required to provide information to an
insured under this section that is a trade secret as determined by
the director under section 2108(5) or 2406(6).
Sec. 2406. (1) Except for worker's compensation insurance,
every an
insurer shall file with the commissioner
every director a
manual of classification, every manual of
rules and rates, every
rating plan, and every or modification
of any of the foregoing a
manual of classification, manual of rules and rates, or rating plan
that it the insurer proposes to use.
Every such Each filing shall
under this subsection must state the proposed effective date
thereof of
the filing and shall must indicate
the character and
extent of the coverage contemplated. If a filing is not accompanied
by the information upon on which
the insurer supports the filing,
and the commissioner director does
not have sufficient information
to determine whether if the
filing meets the requirements of this
chapter, the commissioner director shall
within 10 days of the
filing give written notice to the insurer to furnish the
information upon which it that supports
the filing. The information
furnished in support of a filing may include the experience or
judgment of the insurer or rating organization making the filing,
its interpretation of any statistical data it relies
upon, on, the
experience of other insurers or rating organizations, or any other
relevant factors. A Except as otherwise provided in subsection (6),
the department shall make a filing under this subsection and any
supporting information shall be open to
public inspection after the
filing becomes effective.
(2) Except for worker's compensation insurance, an insurer may
satisfy its obligation to make such filings
by becoming a member
of, or a subscriber to, a licensed rating organization that makes
such filings,
and by filing with the commissioner director a copy
of its authorization of the rating organization to
make such
filings on its behalf. Nothing contained in this This chapter
shall
be construed as requiring any does not require an insurer to become
a member of or a subscriber to any a rating
organization.
(3) For worker's compensation insurance in this state, the
insurer shall file with the commissioner director all
rates and
rating systems. Every insurer that insures
worker's compensation in
this state on the effective date of this subsection
shall file the
rates not later than the effective date of this
subsection.
(4) Except as provided in subsection (3) and
as otherwise
provided in this subsection, the The rates
and rating systems for
worker's compensation insurance shall must be
filed not later than
the date the rates and rating systems are to be
effective. However,
if the insurer providing worker's compensation
insurance is
controlled by a nonprofit health care corporation
formed pursuant
to the nonprofit health care corporation reform act,
Act No. 350 of
the Public Acts of 1980, being sections 550.1101 to
550.1704 of the
Michigan Compiled Laws, the rates and rating systems
that it
proposes to use shall be filed with the commissioner
not less than
45 days before the effective date of the filing.
These filings
shall be considered to meet A filing under this subsection meets
the requirements of this chapter unless and until
the commissioner
director disapproves
a filing pursuant to under
section 2418 or
2420.
(5) Each A filing under subsections
(3) and (4) shall must be
accompanied by a certification by the insurer that, to the best of
its the
insurer's information and belief, the
filing conforms to
the requirements of this chapter.
(6) An insurer or a rating organization filing on the
insurer's behalf may designate information included in the filing
or any accompanying information as a trade secret. The insurer or
House Bill No. 4354 as amended September 17, 2015
the rating organization filing on behalf of the insurer shall
demonstrate to the director that the designated information is a
trade secret. If the director determines that the information is a
trade secret, the information is not subject to public inspection
and is exempt from the freedom of information act, 1976 PA 442, MCL
15.231 to 15.246. As used in this subsection, "trade secret" means
that term as defined in section 2 of the uniform trade secrets act,
1998 PA 448, MCL 445.1902. <<However, trade secret does not include
filings and information accompanying filings under this section that
were subject to public inspection before the effective date of the
amendatory act that added this subsection.>>
Sec.
2458. Every Each rating organization and every insurer
which
that makes its own rates, shall, within a
reasonable time
after
receiving written request therefor for the information and
upon
on payment of such a reasonable
charge, as it may make, shall
furnish
to any an insured affected by a rate made by it, the rating
organization or insurer, or to the insured's authorized
representative, of
the insured, all pertinent information as to the
rate.
Every Pertinent
information under this section does not
include information that is a trade secret as determined by the
director under section 2108(5) or 2406(6). Each rating organization
and
every insurer which that
makes its own rates shall provide
within
this state reasonable means whereby any for a person
aggrieved
by the application of its rating system may to be
heard,
in person or by his or her authorized representative, on his or her
written request to review the manner in which the rating system has
been applied in connection with the insurance afforded to him or
her. If the rating organization or insurer fails to grant or reject
the request within 30 days after it is made, the applicant may
proceed in the same manner as if his or her application had been
rejected.
Any A party affected by the action of the rating
organization or insurer on the request may appeal, within 30 days
after
written notice of the action, appeal to the commissioner,
director,
who, after a hearing held upon on not
less than 10 days'
written notice to the appellant and to the rating organization or
insurer, may affirm or reverse the action. A person who requests a
hearing
before the commissioner pursuant to director under this
section may be represented at the hearing by an attorney. A person,
other than an individual, that requests a hearing before the
commissioner
pursuant to director under this section may also be
represented by an officer or employee of that person. An individual
who
requests a hearing before the commissioner pursuant to director
under this section may also be represented by a relative of the
individual.
Sec.
2606. (1) Every Each insurer shall file with the
commissioner,
director, except as to inland marine risks which that
by general custom of the business are not written according to
manual rates or rating plans, every manual, minimum, class rate,
rating schedule or rating plan and every other rating rule, and
every
modification of any of the foregoing which that it
proposes
to
use. Every such In its filing,
each insurer shall state the
proposed
effective date thereof, of
the filing and shall indicate
the character and extent of the coverage contemplated.
(2)
When If a filing is not accompanied by the information
upon
on which the insurer supports such the filing,
and the
commissioner
director does not have sufficient information to
determine
whether such the filing meets the requirements of this
House Bill No. 4354 as amended September 17, 2015
chapter,
he the director shall require such the insurer
to furnish
the
information upon which it that
supports such the filing
and in
such
event the waiting period shall
commence as of commences on the
date
such the information is furnished. The information furnished
in
support of a filing may include (a) the experience or judgment
of
the insurer or rating organization making the filing, (b) its
interpretation
of any statistical data it relies upon, (c) on, the
experience
of other insurers or rating organizations, or (d) any
other relevant factors.
(3)
A Except as otherwise
provided in this subsection, the
department shall make a filing under this section and any
supporting
information shall be open to public inspection after the
filing becomes effective. An insurer or a rating organization
filing on the insurer's behalf may designate information included
in the filing or any accompanying information as a trade secret.
The insurer or the rating organization filing on behalf of the
insurer shall demonstrate to the director that the designated
information is a trade secret. If the director determines that the
information is a trade secret, the information is not subject to
public inspection and is exempt from the freedom of information
act, 1976 PA 442, MCL 15.231 to 15.246. As used in this subsection,
"trade secret" means that term as defined in section 2 of the
uniform trade secrets act, 1998 PA 448, MCL 445.1902. <<However,
trade secret does not include filings and information accompanying
filings under this section that were subject to public inspection
before the effective date of the amendatory act that added this
sentence.>>
(4) Specific inland marine rates on risks specially rated,
made
by a rating organization, shall must
be filed with the
commissioner.director.
(5)
An insurer may satisfy its obligation to make such filings
under this section by becoming a member of, or a subscriber to, a
licensed
rating organization which that
makes such filings, and by
filing
with the commissioner director
a copy of its authorization
of
the rating organization to make such the filings on its behalf.
Nothing
contained in this This chapter shall be construed as
requiring
any does not require an insurer to become a member of or
a
subscriber to any a rating organization.
Sec.
2652. Every Each rating organization and every insurer
which
that makes its own rates, shall, within a
reasonable time
after
receiving written request therefor for the information and
upon
on payment of such a reasonable
charge, as it may make, shall
furnish
to any an insured affected by a rate made by it, or to the
insured's
authorized representative, of
such insured, all pertinent
information
as to such the rate. Every Pertinent information under
this section does not include information that is a trade secret as
determined by the director under section 2108(5) or 2406(6). Each
rating
organization and every insurer which that makes
its own
rates
shall provide within this state reasonable means whereby any
for
a person aggrieved by the application
of its rating system may
to be heard, in person or by his or her authorized representative,
on
his or her written request to review the manner in which such
the rating system has been applied in connection with the insurance
afforded him or her. If the rating organization or insurer fails to
grant
or reject such the request within 30 days after it is made,
the
applicant may proceed in the same manner as if his the
applicant's
application had been rejected. Any A party
affected by
the
action of such the rating organization or such the insurer
on
such
the request may
appeal, within 30 days after written notice
of
such
the action, appeal to the commissioner, director, who, after a
hearing
held upon on not less than 10 days' written notice to the
appellant
and to such the rating organization or insurer, may
affirm
or reverse such the action.
Enacting section 1. This amendatory act takes effect 90 days
after the date it is enacted into law.
