A dispute in Michigan over database fees for receipt, maintenance and analysis of insurance company annual statement filings, will probably not be resolved until the end of first quarter 2010, according to an order by Michigan Administrative Law Judge Renee Ozburn.
Discovery in the case is to be completed by Dec. 11 and a pre-motion hearing will be held by Jan. 15, 2010. A hearing is scheduled for Feb. 16, 17 and 18 of 2010 and interested parties have until March 1, 2010 to file amicus briefs. An initial hearing was held on July 6.
The disagreement arose when some Michigan domestics declined to pay the filing fees stating that they were told by a previous insurance commissioner that they would not have to pay them. On Dec. 15, 2008, the National Association of Insurance Commissioners, Kansas City, Mo., filed a petition seeking an order from Ken Ross, the current commissioner of the Michigan Office of Financial and Insurance Regulation, authorizing domestics to pay those fees. Under state law, an insurer cannot be compelled to pay any NAIC unless the commissioner orders the company to do so.
Ross has not issued an order on this issue at this time, according to Jason Moon, a department spokesperson. Companies still must file the annual statements but have not agreed to pay the fees. They have not paid any fines, he adds.
The following insurance groups are disputing the fees, according to an exhibit to an NAIC petition:
--the combined operations of: Amerisure Co., Auto Club Ins. Association, Auto Owners Ins. Co & Affiliates, Farm Bureau of Michigan Group and Frankenmuth Mutual Ins. Group.In total, 26 companies are questioning the payments.
In its petition the NAIC points out that it is often called upon to use information from filings to provide services to state insurance departments and state legislators. It estimates that filing fees in 2008 totaled $25.1 million while total expenses for solvency regulatory support was $35.9 million during the same timeframe.