HB-5281, As Passed Senate, May 11, 2004                                     

SUBSTITUTE FOR

HOUSE BILL NO. 5281

                                                                             A bill to amend 1956 PA 218, entitled                                             

"The insurance code of 1956,"                                               

(MCL 500.100 to 500.8302) by adding section 410a.                           

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

1   Sec. 410a.  (1) To qualify for and maintain authority to                    

2   transact insurance in this state solely as a bail bond surety and           

3   fidelity insurance company on or after February 1, 2004, an                 

4   insurer in good standing in its state of domicile that is subject           

5   to regulation by the commissioner shall possess and thereafter              

6   maintain unimpaired capital and surplus in an amount determined             

7   adequate by the commissioner to continue to comply with section             

8   403 but not less than $4,500,000.00 and have, in addition, not              

9   less than $3,000,000.00 in current guarantees and security with             

10  respect to bail bonds issued by the insurer in states in which it           

11  is then authorized.  An insurer with authority to transact bail             

1   bond surety and fidelity insurance in this state shall not offer            

2   or provide surety and fidelity coverages other than bail bonds.             

3       (2) The commissioner shall take into account the risk based                 

4   capital requirements as developed by the national association of            

5   insurance commissioners and the claims history for Michigan bail            

6   bonds issued by the licensed bail bond agencies for which the               

7   insurer will be or is issuing bail bonds in Michigan in order to            

8   determine adequate compliance with section 403.                             

9       (3) As used in this section, "bail bond surety and fidelity                 

10  insurance" is surety and fidelity insurance that is limited to              

11  the provision of bail bonds.