Mich. Admin. Code R. 500.1209 - Expense allocation
Current through Vol. 22-05, April 1, 2022
The following state regulations pages link to this page.
State regulations are updated quarterly; we currently have two versions available. Below is a comparison between our most recent version and the prior quarterly release. More comparison features will be added as we have more versions to compare.
Rule 9. (1) Expense provisions for each category of expenses shall be reasonably allocated among classifications in a manner that equitably reflects variations, if any, in the manner in which such expenses are anticipated to be incurred with respect to the groups of individuals or risks defined by those classifications. Expenses, other than allocated loss adjustment expenses, shall not be presumed to be incurred proportionally to classification relativities based on anticipated losses.
(2) Expense provisions for premium taxes, if any, shall reflect the applicable premium tax rate.
(3) Expense provisions for each other category of expenses shall be reasonably allocated among classifications based on losses, coverages, exposures, or other basis that equitably measures the variations, if any, in the manner in which such expenses are anticipated to be incurred with respect to the classifications. Expense allocation methods may include percentage-of-premium, uniform-per-coverage, uniform-per-exposure, or other basis, as appropriate and justified.
History: 1980 AACS.