Michigan Laws 500.703 – Claim reserves and claim expense reserves required; conditions; testing for adequacy and reasonableness
Current as of: 2023 | Check for updates
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(1) Claim reserves are required for all incurred but unpaid claims on all health insurance policies and certificates.
(2) Appropriate claim expense reserves are required with respect to the estimated expense of settlement of all incurred but unpaid claims on health insurance policies and certificates.
Terms Used In Michigan Laws 500.703
- Insurer: means an individual, corporation, association, partnership, reciprocal exchange, inter-insurer, Lloyds organization, fraternal benefit society, or other legal entity, engaged or attempting to engage in the business of making insurance or surety contracts. See Michigan Laws 500.106
- Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
(3) All claim reserves on health insurance policies and certificates for prior valuation years are to be tested for adequacy and reasonableness consistent with claim runoff schedules in accordance with the insurer‘s annual statutory financial statement including consideration of any residual unpaid liability.