American Council of Life Insurers v. Ross
Adam V. Russo | July 9, 2010
Defendant-appellee Ken Ross is the commissioner of the Michigan Office of Financial and Insurance Services (OFIS). OFIS is responsible for licensing, examining, and supervising insurers and nonprofit health care corporations doing business in Michigan. To this end, OFIS’s authority includes the power to disapprove insurance policy forms and documents associated with such forms that are filed by insurers and nonprofit health care corporations doing business in the state. Under OFIS’s authority to regulate insurance, it promulgated rules, Michigan Administrative Code Rules 500.2201-500.2202 and 550.111-550.112, prohibiting insurers from issuing, delivering, or advertising insurance contracts or policies that contain “discretionary clauses” and providing that any such clause is void and of no effect. The rules took effect June 1, 2007. Given that employee benefit plans established or maintained under ERISA commonly contain discretionary clauses, the rules would prohibit any entity covered by them from “issuing, advertising, or delivering to any person in the State of Michigan, including an employee benefit plan subject to ERISA, an under-written policy or certificate that includes a discretionary clause.” (more…)
