Michigan Laws 500.4623 – Sponsored captive insurance company; discount of reserves
Current as of: 2023 | Check for updates
|
Other versions
Terms Used In Michigan Laws 500.4623
- Captive insurance company: means a pure captive insurance company, association captive insurance company, sponsored captive insurance company, special purpose captive insurance company, or industrial insured captive insurance company authorized under this chapter. See Michigan Laws 500.4601
- Commissioner: means the director. See Michigan Laws 500.102
- Rate: means the cost of insurance per payroll before adjustment for an individual insured's size, exposure, or loss experience. See Michigan Laws 500.2402
- Sponsored captive insurance company: means a captive insurance company in which the minimum capital and retained earnings required by applicable law is provided by 1 or more sponsors, that is authorized under this chapter, that insures the risks of separate participants through the participant contract, and that segregates each participant's liability through 1 or more protected cells. See Michigan Laws 500.4601
- Treasury rates: means the United States treasury strips asked yield as published in the Wall Street Journal as of a balance sheet date. See Michigan Laws 500.4601
(1) A sponsored captive insurance company may discount its loss and loss adjustment expense reserves at the lesser of treasury rates or the captive insurance company’s actual rate of return applied to the applicable payments projected through the use of the expected payment pattern associated with the reserves.
(2) The commissioner may disallow the discounting of reserves if a sponsored captive insurance company violates a provision of this act.