Sec. 711.
(1) Unearned premium reserves are required for all health insurance policies and certificates with respect to the period of coverage for which premiums, other than premiums paid in advance, have been paid beyond the date of valuation.
(2) If premiums due and unpaid are carried as an asset, such premiums shall be treated as premiums in force, subject to unearned premium reserve determination. The value of unpaid commissions, premium taxes, and the cost of collection associated with due and unpaid premiums shall be carried as an offsetting liability.
(3) The gross premiums paid in advance for a period of coverage commencing after the next premium due date that follows the date of valuation may be appropriately discounted to the valuation date and shall be held either as a separate liability or as an addition to the unearned premium reserve that would otherwise be required as a minimum.
History: Add. 1994, Act 148, Imd. Eff. June 7, 1994 Popular Name: Act 218
Structure Michigan Compiled Laws
Chapter 500 - Insurance Code of 1956
Act 218 of 1956 - The Insurance Code of 1956 (500.100 - 500.8302)
218-1956-7 - Chapter 7 Reserve Standards for Disability Insurance (500.701...500.737)
Section 500.701 - Definitions.
Section 500.702 - Health Insurance Reserves; Determination of Adequacy; Basis.
Section 500.709 - Estimation of Claim Liabilities; Methods.
Section 500.715 - Premium Reserves; Computation.
Section 500.725 - Reinsurance; Determination of Increases To, or Credit Against, Reserves.
Section 500.733 - Maximum Interest Rates.
Section 500.735 - Mortality Basis; Use of Other Mortality Tables; Request for Approval.