Section 500.611. Discretionary group life insurance; procedures.

(1) A group life insurance policy shall  not   be  issued  under section 4424 of Act No. 218 of the Public Acts of 1956, as amended, being S500.4424 of the Michigan Compiled Laws, until the commissioner has issued a certificate of authority to purchase discretionary group life  insurance  to the applicant group and has given  written  notice  of  issuance   of the certificate of authority to the insurer which is to provide the  group life insurance.

(2)   Application for a certificate of authority shall be   made  to  the commissioner on forms prescribed by the commissioner by the person who is to serve as policyholder for the proposed discretionary group.  If  a trustee is to serve as policyholder, he  or  she  shall submit with the application written evidence of his or her authority to act as trustee. If the applicant group is party to or results from a trust agreement or  a bargaining agreement, a copy of the agreement shall be submitted with the application. If the applicant group has a constitution or bylaws, or both, a certified copy of each such  document  shall  be  submitted with  the application.

(3)   If the commissioner determines, based upon representations made  in the application and  in  the  documents  accompanying  it,   that  granting permission to  the  group  to purchase group life insurance would be consonant with the dictates of public policy as expressed in section 4424 of Act No. 218 of the Public Acts of 1956, as amended, being S500.4424 of the Michigan Compiled Laws, he  or  she  shall   issue  a  preliminary certificate of eligibility, which certificate indicates that the group is qualified to negotiate with insurers for group life insurance coverage.

(4)   The policies, certificates, and schedule of rates which an insurer proposes to use in providing insurance coverage for a group holding  a certificate of eligibility shall be submitted to the  commissioner  by  the insurer. If the commissioner determines, after  review of  the  materials submitted, that the proposed plan of insurance meets  the  requirements  of Act No. 218 of the Public Acts of 1956, as amended, being S500.100 et seq.of the Michigan

Compiled Laws, he or she  shall  issue   a    certificate     of authority to the group and shall notify the insurer in   writing  that   the certificate has been issued.

(5)   A group holding a certificate  of  authority   shall  not  make   any material change in the composition or size of the group and shall not make any material change in the benefits provided by  the   plan  of  insurance approved by the commissioner, until  the  commissioner has approved the changes in writing. If a change is made without the prior written approval of the commissioner, the certificate of authority may be terminated.

(6)   An insurer providing coverage for a group holding a certificate  of authority shall file any change in its schedule of rates for that coverage with the commissioner not later than 30 days after the effective date of the change. An insurer shall not issue any group life insurance policy for which the premium rate exceeds that determined by the schedule of such group as then on file with the commissioner.

(7)   The commissioner may require that each discretionary group holding a certificate of authority file a report with the  commissioner  at  the conclusion of each policy year, on a form prescribed by the  commissioner.

History: 1979 AC; 1981 AACS.