The following opinion is presented on-line for informational use only and does not replace the official version. (Mich Dept of Attorney General Web Site - www.ag.state.mi.us)



 

STATE OF MICHIGAN

MIKE COX, ATTORNEY GENERAL

INSURANCE CODE OF 1956:

OFFICE OF FINANCIAL AND INSURANCE SERVICES:

Authority of Commissioner of the Office of Financial and Insurance Services to share confidential information with regulatory agencies of foreign countries

Section 222(7)(b) of the Insurance Code, MCL 500.222(7)(b), authorizes the Commissioner of the Office of Financial and Insurance Services to share confidential documents and information regarding insurance companies with "any relevant regulatory agency" of another country, provided the Commissioner is given assurances that the information will be kept confidential.

Opinion No. 7197

January 24, 2007

Ms. Linda A. Watters
Commissioner
Office of Financial and Insurance Services
Department of Labor and Economic Growth
P.O. Box 30220
Lansing, Michigan 48909

You have asked if section 222(7)(b) of the Insurance Code authorizes the Commissioner of the Office of Financial and Insurance Services to share confidential documents and information regarding insurance companies with relevant regulatory agencies of other countries.

The Insurance Code of 1956, 1956 PA 218, MCL 500.100 et seq, broadly authorizes the Insurance Commissioner1 to examine the affairs of any insurance company at any time after it has been authorized to do business in Michigan. MCL 500.222. This includes "domestic," "foreign," and "alien" insurance companies as defined in section 110 of the Insurance Code, MCL 500.110. Domestic insurance companies are formed under Michigan law. MCL 500.110(1). Foreign insurers are formed under the laws of the District of Columbia or any other state, commonwealth, territory, or possession of the United States. MCL 500.110(2). Alien insurance companies are formed under the laws of any country other than the United States or any state, district, commonwealth, territory, or possession of the United States. MCL 500.110(3). A domestic, foreign, or alien insurer "shall not be authorized" to do business in this State or continue to be so authorized if the insurer is not or does not continue to be "safe, reliable, and entitled to public confidence." MCL 500.403.

Section 222(7) of the Insurance Code, MCL 500.222(7), declares that most information and documents generated in the course of an insurance company examination are confidential. It requires the Commissioner to withhold any examination report from public inspection until the report is final and filed with the Commissioner. Even then, the Commissioner may continue to withhold an examination report from public inspection "for such time as he or she may consider proper." In any event, section 222(7) mandates that documents and information connected to an examination report or an investigation shall be confidential and shall not be disclosed except as specifically allowed in that section.

Section 222(7) explicitly authorizes the Commissioner to share confidential information with certain interested persons, such as the Governor, the Attorney General, and other regulatory agencies, if they agree to keep the information confidential:

If assurances are provided that the information will be kept confidential, the commissioner may disclose confidential work papers, correspondence, memoranda, reports, records, or other information as follows:

(a) To the governor or the attorney general.

(b) To any relevant regulatory agency, including regulatory agencies of other states or the federal government.

(c) In connection with an enforcement action brought pursuant to this or another applicable act.

(d) To law enforcement officials.

(e) To persons authorized by the Ingham county circuit court to receive the information.

(f) To persons entitled to receive such information in order to discharge duties specifically provided for in this act. [MCL 500.222(7).]

Under section 226 of the Insurance Code, MCL 500.226, it is a misdemeanor to disclose confidential examination or investigation information except as authorized by section 222(7).

Whether the Commissioner may share confidential examination or investigation information and documents with relevant regulatory agencies of other countries turns on the meaning of section 222(7)(b) of the Insurance Code. If assurances are provided that the information will be kept confidential, the Commissioner may disclose confidential information and documents: "(b) To any relevant regulatory agency, including regulatory agencies of other states or the federal government." It may be argued that section 222(7)(b) encompasses regulatory agencies of another country because the words "to any relevant regulatory agency" are expansive. (Emphasis added.) Or it might be argued that the words "including regulatory agencies of other states or the federal government" are words of limitation, implicitly meant to exclude regulatory agencies of other countries.

The most basic rule of statutory construction is to determine the Legislature's intent by first looking to the words of a statute themselves. "The words of a statute provide 'the most reliable evidence of its intent.'" Sun Valley Foods Co v Ward, 460 Mich 230, 236; 596 NW2d 119 (1999), quoting United States v Turkette, 452 US 576, 593; 101 S Ct 2524; 69 L Ed 2d 246 (1981). Every word must be given meaning and statutes should not be construed to make any word superfluous. Koontz v Ameritech Services, 466 Mich 304, 312; 645 NW2d 34 (2002).

The word "including" in a statutory definition commonly has two possible meanings. The general rule is that "including" introduces one or more merely illustrative examples. "When 'include' is utilized, it is generally improper to conclude that entities not specifically enumerated are excluded." 2A Singer, Sutherland Statutory Construction (6th ed), § 47.23, p 316. The Michigan Supreme Court noted this interpretation in Michigan Bell Telephone Co v Treasury Dep’t, 445 Mich 470, 479; 518 NW2d 808 (1994):

[A]s one authority has explained, where a term is defined by declaring what it "includes," it is susceptible to extension of meaning by construction. 2A Singer, Sutherland Statutory Construction (5th ed), § 47.07, pp 151-156. When used in a statutory definition, the word "includes" is a term of enlargement, not of limitation. It "conveys the conclusion that there are other items includable, though not specifically enumerated . . . ." Id., p 152. Such a definition suggests, if not requires, a construction broad enough to encompass other items not explicitly mentioned.

Applying this rule, the Court concluded that the statutory definition of property subject to taxation by 1905 PA 282 encompassed tangible as well as intangible property, even though intangible property was not specifically listed in the examples following the word "include" in the statute. Id.

Alternatively, the word "including" may introduce a list that restricts a more general preceding term. For example, in Frame v Nehls, 452 Mich 171, 178-179; 550 NW2d 739 (1996), the Court noted: "When used in the text of a statute, the word 'includes' can be used as a term of enlargement or of limitation, and the word in and of itself is not determinative of how it is intended to be used." In that case, the Court concluded that "includes" was used as a term of limitation, which introduced an exclusive list of those child custody disputes that would allow grandparents to petition for an order of visitation with their grandchildren.

As noted above, the Legislature authorized disclosure to "any relevant regulatory agency." MCL 500.222(7)(b). (Emphasis added.) The word "any" must be given meaning. The Michigan Supreme Court has held that "any" is all-inclusive. "The word 'any' means just what it says. It includes 'each' and 'every.'" Sifers v Horen, 385 Mich 195, 199, n 2; 188 NW2d 623 (1971).

Resolving the intent of the Legislature and the significance of the words "including" and "any" requires that the words of the statute be read together to harmonize their meanings, giving effect to the act as a whole. Sweatt v Dep't of Corrections, 468 Mich 172, 180 n 4; 661 NW2d 201 (2003). To the extent that there is any ambiguity in a statute, the courts seek "to effectuate the Legislature's intent through a reasonable construction, considering the purpose of the statute and the object sought to be accomplished." Macomb County Prosecuting Attorney v Murphy, 464 Mich 149, 158; 627 NW2d 247 (2001).

The courts have long held that because the business of insurance is of great public interest, insurance laws are to be liberally construed to protect the public, policyholders, and creditors. Attorney General ex rel Ins Comm'r v Michigan Surety Co, 364 Mich 299, 325; 110 NW2d 677 (1961); Szabo v Ins Comm'r, 99 Mich App 596, 599; 299 NW2d 364 (1980).

As you advise in your letter, the business of insurance has become global. Because Michigan's largest life insurer is owned by an insurer domiciled in the United Kingdom and the financial strength of each bears on the strength of the other, you explain that the insurance regulator of each jurisdiction has an interest in the financial condition of both insurers. In your view, access to such information protects Michigan citizens. "Information is critical to assessing the risk to a Michigan company operating within a multinational holding company supervised by a foreign regulator. The accurate assessment of risk better protects Michigan consumers." Your staff further advises that in order for Michigan to obtain the information it needs from other regulatory agencies, it must be willing to reciprocate that service by sharing information with them.

Michigan courts have made it clear that "powers necessary to a full effectuation of authority expressly granted will be recognized as properly appertaining to the agency." In re Quality of Service Standards for Regulated Telecommunication Services, 204 Mich App 607, 613; 516 NW2d 142 (1994). As discussed earlier, MCL 500.222 authorizes the Commissioner to examine the affairs of any insurance company at any time after it has been authorized to do business in Michigan, and no domestic, foreign, or alien insurer may continue to be authorized to do business in this State if the insurer does not continue to be "safe, reliable, and entitled to public confidence." MCL 500.403. Moreover, MCL 500.222(7) expressly grants the Commissioner the power to share confidential information with a "relevant regulatory agency" if the agency provides assurances the information will be kept confidential. Where, as indicated in your letter, the financial strength of an insurer regulated by an agency in a foreign country bears upon the financial condition of a particular insurer doing business in Michigan, the need to share information between the regulatory agencies to fully effectuate the Commissioner's duties is apparent. Under these circumstances, the regulatory agency in the foreign country clearly qualifies as a "relevant" regulatory agency.

The history of this provision, which reveals a legislative intent to expand the scope of the Commissioner's powers to share information, provides further support for a broad construction. Before it was amended by 1992 PA 182, what was then section 222(4) only authorized the Commissioner to share confidential information with the insurance commissioners of other states.

In any event, all insurance bureau materials related to an examination report shall be withheld from public inspection and shall be confidential. This subsection shall not be construed as prohibiting the commissioner from releasing to another state's insurance commissioner information relating to the examination of an insurer if the commissioner from the other state provides assurances that the information will be kept confidential. [1956 PA 218, section 222(4), MCL 500.222(4), as amended by 1989 PA 302; emphasis added.]

1992 PA 182 expanded the range of persons with whom the Commissioner may share confidential information. That Act amended then section 222(4) to authorize the Commissioner to share confidential information not just with the insurance commissioner of another state, but with, among others, "any relevant regulatory agency, including regulatory agencies of other states or the federal government."2

It is noteworthy that the Legislature chose expansive, rather than restrictive, language. Had the Legislature intended to limit MCL 500.222(7)(b) to regulatory agencies in the United States, it could easily have done so by providing, for example, that disclosure was authorized: "To relevant regulatory agencies of this state, other states, or the federal government."3 This would have excluded regulatory agencies outside the United States under the maxim expressio unius est exclusio alterius. See, e.g., Sebewaing Industries, Inc, v Village of Sebewaing, 337 Mich 530, 545; 60 NW2d 444 (1953) ("Express mention in a statute of one thing implies the exclusion of other similar things").

All of these factors convey a legislative intent to facilitate the Commissioner's sharing of information with "any relevant regulatory agency," without geographic limitation, insofar as that sharing is consistent with fulfilling her responsibilities under the Insurance Code, if assurances are provided that the information will be kept confidential.4

It is my opinion, therefore, that section 222(7)(b) of the Insurance Code, MCL 500.222(7)(b), authorizes the Commissioner of the Office of Financial and Insurance Services to share confidential documents and information regarding insurance companies with "any relevant regulatory agency" of another country, provided the Commissioner is given assurances that the information will be kept confidential.

MIKE COX
Attorney General

1 Executive Order 2000-4 transferred all of the authority, powers, duties, functions, and responsibilities of the Insurance Bureau and of the Commissioner of Insurance to the Office of Financial and Insurance Services and the Commissioner of the Office of Financial and Insurance Services effective April 3, 2000.

2
1994 PA 443 subsequently renumbered section 222(4) as section 222(7) with no further changes made to the language under review here.

3 Cf., MCL 500.222(8) (providing that the confidentiality requirements of MCL 500.222(7) do not apply in any proceeding or action brought against or by the insurer under this act or any other applicable act "of this state, any other state, or the United States"). 

4 MCL 500.222(7) does not dictate the procedure for sharing such information.  The agency has discretion to determine how best to arrange for the disclosure.  Cf., Coffman v State Bd of Examiners in Optometry, 331 Mich 582, 590; 50 NW2d 322 (1951) (agencies have incidental power necessary to carry out the purpose of the Legislature, especially in matters of internal administration).  What is essential is that the Commissioner be provided with reliable assurances that the information will be kept confidential by the recipient regulatory agency.