Notices of Appointment

Issued and entered June 30, 1989 by Dhiraj N. Shah, Acting Commissioner of Insurance

BACKGROUND AND APPLICABLE LAW

Section 1205(2) of the Insurance Code provides:

(2) An applicant may represent his sponsoring insurer after receipt of the license from the commissioner. A licensed agent who is otherwise qualified may represent an additional insurer after mailing of a notice of appointment from that insurer.

The Insurance Bureau has routinely accepted the date on the notice of appointment by an additional insurer as the mailing date and deemed it sufficient to grant authority to a licensed and qualified agent pursuant to Section 1205(2). Thus this date becomes the effective date for the additional appointment.

Many notices of appointment bear a date which, considering the date upon which it was received by the Bureau, cannot reasonably be consistent with the date of mailing. It is difficult to determine, therefore, the correct effective date of appointment. Further, many notices of appointment are missing pertinent information or contain incorrect information which cannot be recorded.

The purpose of these guidelines is to outline the procedure the Bureau will use in order to facilitate the processing of approximately 75,000 notices of appointment annually.

RIGHTS AND PROCEDURE

The Bureau will continue to accept the date on the notice of appointment as its effective date provided it is no more than 15 days prior to the date the notice is received by the Bureau. A notice of appointment bearing a date more than fifteen 15 days prior to receipt by the Bureau will be recorded as effective 15 days before receipt, unless accompanied by written verification of the actual appointment date from the insurer. This verification should contain a reasonable explanation for the delay in mailing. Notices bearing no date will be effective as of the date of the receipt by the Bureau.

Notices which cannot be processed because of missing information (i.e. qualifications not shown) will be returned to the company for resubmission. The above procedure will apply to the resubmitted notice of appointment.

Notices with incorrect information (i.e. agent shown to have more qualifications than actually possessed) will be processed to the extent possible. The company will then be advised of the information which cannot be recorded.

This bulletin takes effect immediately. Any questions regarding this procedure should be directed to:

Licensing & Investigations Division
Michigan Insurance Bureau
P.O. Box 30220
Lansing, MI 48909
(517) 373-0645

In accordance with Section 3(6) of the Administrative Procedures Act of 1969, as amended, MCLA 24.203(6); MSA 3.560(103)(6), these guidelines are a statement of policy which the agency intends to follow, which do not have the force or effect of law, and which bind the agency, but do not bind any other person. The Bureau shall use these guidelines in processing agent appointments.