LANSING — Rick Snyder has signed an executive order establishing the Department of Insurance and Financial Services to provide a focal point of consumer protection, enable efficient and effective regulation, and position the insurance and financial services sector for economic growth.
The insurance and financial services fields are rapidly changing, health insurance is becoming more accessible and digital banking is revolutionizing the way money is used. The Department of Insurance and Financial Services will provide a greater focus on the functions currently performed by the Office of Financial and Insurance Regulation, housed in the Department of Licensing and Regulatory Affairs, ensuring that consumers are protected, while fostering a business climate that promotes economic growth.
“Insurance and financial service businesses are a vital part of the overall economic health of Michigan,” Snyder said. “By establishing a new department dedicated to industry sustainability it further emphasizes the commitment to removing red tape from economic growth in Michigan. This order will also go a long way toward creating and enforcing appropriate regulations, so we have robust consumer protections in place.”
The insurance and financial services industries are significant components of Michigan’s economy, directly employing over 150,000 Michigan residents and generating more than $9 billion in annual payroll. Michigan is home to over 300 state banks and credit unions and 149 insurance companies. Michigan serves as a port of entry and chief U.S. regulator for five Canadian insurance companies, and nearly 1,500 out-of-state insurance companies also do business in this state.
When the order becomes effective in 60 days, all authority and responsibilities previously bestowed upon the Commissioner of Office of Financial and Insurance Regulation will be transferred to the the Department of Insurance and Financial Services director, including all board and commission roles. Governor Snyder plans to appoint current Office of Financial and Insurance Regulation Commissioner Kevin Clinton as the Department of Insurance and Financial Services director, subject to advice and consent of the Michigan Senate.
All functions of the Autism Coverage Reimbursement Program, created as part of the legislative package passed in 2012 to ease the burden on families raising children with autism, will also be transferred to Department of Insurance and Financial Services from the Department of Licensing and Regulatory Affairs.