Purchasing Group Registration

 The Office of Financial and Insurance Regulation issues

A. NAME OF PERMIT OR APPROVAL:

Purchasing Group Registration

B. STATUTORY AUTHORITY:

The Insurance Code of 1956 - Chapter 18

The Insurance Code of 1956 - Chapter 19

C. APPLICABLE REGULATION:

PA 218 of 1956 The Insurance Code of 1956

D. SUMMARY OF PERMIT/APPROVAL PROCESS:

 1.  Applicability (activities that require the permit)

A purchasing group is composed of members whose businesses or activities are similar or related (common business, trade, product, service, premises, or operation) with respect to the liability which its members are exposed and its purpose is to purchase liability insurance on a group basis. The purchasing group is domiciled in a state and purchases insurance ONLY for its members to cover their similar liability exposure.

A Purchasing Group is a group that meets all of the following requirements:

• As one of its purposes, purchases liability insurance on a group basis.
• Is composed of members whose businesses or activities are similar or related with respect to the liability to which members are exposed by virtue of a related, similar, or common business, trade, product, service, premises, or operation.
• Purchases insurance only for its group members and only to cover their similar or related liability exposure.
• Is domiciled in a state.

 2.  Pre-Application Requirements

There are no pre-application requirements for Purchasing Group Registrations.

 3.  Application Submission Requirements

Before conducting business in the State of Michigan, the Purchasing Group must submit the following:

• Form FIS 0359 Purchasing Group Application for Registration

• Form FIS 0364 Purchasing Group Report of Operations

• Form FIS 0365 Consent to Service

• Form FIS 0361 Affiliate Statement

• The registration fee of $25.00 plus $25.00 per insurer in the form of a money order, cashier's check, or business check. Do not send personal checks.

 4.  Procedures and Time-Frame for Obtaining Permit or Approval

• Submit the above registration forms and fees to the address on the application. Registration time-frame is normally 60-90 days if no further information is requested.

 5.  Operational Requirements

Additional Information for a Purchasing Group

• If the purchasing group is registered to purchase insurance in the Surplus Lines market, any Surplus Lines taxes due the State of Michigan must be paid on the form FIS 0255 Report of Insurance Purchased from an Unauthorized Insurer. Payment is due within 30 days of the effective date of the policy.
• A purchasing group may only purchase insurance from a Michigan authorized insurer, a registered risk retention group, or an eligible unauthorized insurer.
• The purchasing group shall inform in writing each of the Michigan members of the group that the risk retention group or an eligible unauthorized insurer may not be subject to all insurance laws and regulations of this state.
• The purchasing group will not purchase insurance providing for a deductible or self-insured retention unless the deductible or self-insured retention is the sole responsibility of each individual member.

Renewal of a Purchasing Group Registration

The FIS 0362 Annual Renewal Report for Purchasing Group is due annually on February 1st. There is presently no fee required. If the purchasing group does not submit a FIS 0362, the purchasing group will be considered not registered. The purchasing group will be required to re-submit a new application and registration fee before recommencing business in the State of Michigan.

Change of Purchasing Group Information

Any change in registration information must be submitted within 10 days of the change on form FIS 0363 Change in Registration for Purchasing Group.

 6.  Fees

Registration Fee - $25.00, plus $25.00 per insurer

 7.  Appeal Process

Not applicable for Purchasing Group Registrations.

 8.  Public Input Opportunities

We encourage consumers to first attempt to resolve disputes directly with their financial service entity. If a resolution cannot be reached, our office can try to help resolve a dispute. A complaint form must be completed for the type of financial service you are having difficulty with.

• Insurance Complaint Form and Guide to Resolving Problems
• Insurance Complaint Form (download to use typewriter feature, requires Acrobat Reader v7.0.9 or higher)
• Insurance Business-to-Business Complaint Guide

E. Contact Information:

Contact Us

Creation/Revision Date:

October 6, 2010