A.R.S. § 20-560 — Arizona Code / Title 20 / Chapter 3 / Article 2 / Section 560
20-560 Derivative transactions; definitions
Status: in_force

20-560. Derivative transactions; definitions

A. An insurer, directly or indirectly through an investment subsidiary, may use derivative instruments to engage in hedging transactions, income generation transactions and replication transactions pursuant to this section.

B. An insurer may enter into hedging transactions if, after giving effect to such transactions, all of the following apply:

1. The aggregate statement value of options, caps, floors and warrants not attached to another financial instrument purchased and used in hedging transactions does not exceed seven and one-half per cent of its admitted assets.

2. The aggregate statement value of options, caps and floors written in hedging transactions does not exceed three per cent of its admitted assets.

3. The aggregate potential exposure of collars, swaps, forwards and futures used in hedging transactions does not exceed six and one-half per cent of its admitted assets.

C. An insurer may enter into the following types of income generation transactions if after giving effect to the transactions the aggregate statement value of the fixed income assets that are subject to call or that generate the cash flows for payments under the caps or floors, plus the face value of fixed income securities underlying a derivative instrument subject to call, plus the amount of the purchase obligations under the puts, does not exceed ten per cent of its admitted assets:

1. Sales of covered call options on noncallable fixed income securities, callable fixed income securities if the option expires by its terms before the end of the noncallable period or derivative instruments based on fixed income securities.

2. Sales of covered call options on equity securities, if the insurer holds in its portfolio or can immediately acquire through the exercise of options, warrants or conversion rights already owned, the equity securities subject to call during the complete term of the call option sold.

3. Sales of covered puts on investments that the insurer is permitted to acquire under this article, if the insurer has escrowed or entered into a custodian agreement segregating, cash or cash equivalents with a market value equal to the amount of its purchase obligations under the put during the complete term of the put option sold.

4. Sales of covered caps or floors, if the insurer holds in its portfolio the investments generating the cash flow to make the required payments under the caps or floors during the complete term that the cap or floor is outstanding.

D. An insurer may enter into replication transactions with the prior written approval of the director if both of the following apply:

1. The insurer would otherwise be authorized to invest its funds under this article in the asset being replicated.

2. The asset being replicated is subject to all the provisions of this article relating to the making of investments by the insurer in that type of asset as if the transaction constituted a direct investment by the insurer in the replicated asset.

E. The director may approve of additional transactions involving the use of derivative instruments in excess of the limits of subsection B of this section or for other risk management purposes, except that replication transactions shall be permitted only for risk management purposes.

F. Each derivative instrument shall be one of the following:

1. Traded on a qualified exchange.

2. Entered into with or guaranteed by a business entity.

3. Issued or written with the issuer of the underlying interest on which the derivative instrument is based.

4. Entered into with a qualified foreign exchange.

G. For the purposes of this section, unless the context otherwise requires:

1. "Business entity" includes a sole proprietorship, corporation, limited liability company, association, partnership, joint stock company, joint venture, mutual fund, trust, joint tenancy or other similar form of business organization, whether organized for-profit or not-for-profit.

2. "Cap" means an agreement obligating the seller to make payments to the buyer, with each payment based on the amount by which a reference price or level or the performance or value of one or more underlying interests exceeds a predetermined number, sometimes called the strike rate or strike price.

3. "Collar" means an agreement to receive payments as the buyer of an option, cap or floor and to make payments as the seller of a different option, cap or floor.

4. "Derivative instrument":

(a) Means an agreement, option or instrument or a series or combination that either:

(i) Requires a party to make or take delivery of, or assume or relinquish, a specified amount of one or more underlying interests, or to make a cash settlement in lieu thereof.

(ii) Has a price, performance, value or cash flow based primarily on the actual or expected price, level, performance, value or cash flow of one or more underlying interests.

(b) Includes options, warrants used in a hedging transaction and not attached to another financial instrument, caps, floors, collars, swaps, forwards, futures and any other agreements, options or instruments substantially similar thereto or any series or combination thereof and any agreements, options or instruments permitted under rules adopted to carry out the provisions of this article.

(c) Does not include an investment authorized by sections 20-537 through 20-548, 20-550 through 20-558, 20-561 and 20-562.

5. "Derivative transaction" means a transaction involving the use of one or more derivative instruments.

6. "Floor" means an agreement obligating the seller to make payments to the buyer in which each payment is based on the amount by which a predetermined number exceeds a reference price, level, performance or value of one or more underlying interests.

7. "Forward" means an agreement, other than a future, to make or take delivery of, or effect a cash settlement based on the actual or expected price, level, performance or value of, one or more underlying interests.

8. "Future" means an agreement, traded on a qualified exchange or qualified foreign exchange, to make or take delivery of, or effect a cash settlement based on the actual or expected price, level, performance or value of, one or more underlying interests.

9. "Hedging transaction" means a derivative transaction that is entered into and maintained to reduce either:

(a) The risk of a change in the value, yield, price, cash flow or quantity of assets or liabilities that the insurer has acquired or incurred or anticipates acquiring or incurring.

(b) The currency exchange rate risk or the degree of exposure as to assets or liabilities that an insurer has acquired or incurred or anticipates acquiring or incurring.

10. "Income generation transaction" means a derivative transaction involving the writing of covered call options, covered put options, covered caps or covered floors that is intended to generate income or enhance return.

11. "Option" means an agreement giving the buyer the right to buy or receive, referred to as a "call option", to sell or deliver, referred to as a "put option", to enter into, extend or terminate, or to effect a cash settlement based on the actual or expected price, spread, level, performance or value of one or more underlying interests.

12. "Qualified exchange" means:

(a) A securities exchange registered as a national securities exchange, or a securities market regulated under the securities exchange act of 1934, as amended.

(b) A board of trade or commodities exchange designated as a contract market by the commodity futures trading commission or any successor thereof.

(c) Private offerings, resales and trading through automated linkages.

(d) A designated offshore securities market as defined in securities exchange commission regulations, 17 Code of Federal Regulations part 230, as amended.

(e) A qualified foreign exchange.

13. "Qualified foreign exchange" means a foreign exchange, board of trade or contract market located outside the United States or its territories or possessions if one of the following applies:

(a) The exchange, board of trade or contract market has received regulatory comparability relief under commodity futures trading commission rule 30.10, as set forth in appendix C to 17 Code of Federal Regulations part 30.

(b) The exchange, board of trade or contract market is, or its members are, subject to the jurisdiction of a foreign futures authority that has received regulatory comparability relief under commodity futures trading commission rule 30.10, as set forth in appendix C to 17 Code of Federal Regulations, part 30, as to futures transactions in the jurisdiction where the exchange, board of trade or contract market is located.

(c) Foreign stock index futures contracts are listed on the exchange, board of trade or contract market and the contracts are the subject of no-action relief issued by the commodity futures trading commission office of general counsel if the exchange, board of trade or contract market that qualifies as a qualified foreign exchange under this subdivision is a qualified foreign exchange only as to foreign stock index futures contracts that are the subject of no-action relief.

14. "Replication transaction":

(a) Means a derivative transaction that is intended to replicate the performance of one or more assets that an insurer is authorized to acquire under this article.

(b) Does not include a derivative transaction that is entered into as a hedging transaction.

15. "Swap" means an agreement to exchange or to net payments at one or more times based on the actual or expected price, level, performance or value of one or more underlying interests.

16. "Underlying interest" means the assets, liabilities, other interests or a combination thereof underlying a derivative instrument, including any securities, currencies, rates, indices, commodities or derivative instruments.

17. "Warrant" means an instrument that gives the holder the right to purchase an underlying financial instrument at a given price and time or at a series of prices and times outlined in the warrant agreement.  Warrants may be issued alone or in connection with the sale of other securities, including as part of a merger or recapitalization agreement or to facilitate divestiture of the securities of another business entity.
A.R.S. § 20-1098.10 — Arizona Code / Title 20 / Chapter 4 / Article 14 / Section 1098.10
20-1098.10 Legal investments
Status: in_force

20-1098.10. Legal investments

A. A group captive insurer, an agency captive insurer and a protected cell captive insurer shall comply with the investment requirements prescribed in chapter 3, article 2 of this title.  Notwithstanding any other provision of this title, the director may approve the use of alternative reliable methods of valuation and rating.

B. A pure captive insurer is not subject to restrictions on allowable investments, except that the director may prohibit or limit any investment that threatens the solvency or liquidity of the pure captive insurer.

C. Only a pure captive insurer may make loans to its affiliates.  A note shall evidence the loan.  Before making any such loan, the pure captive insurer shall obtain the director's written approval to make the loan and approval for the form of the note.
A.R.S. § 20-1609 — Arizona Code / Title 20 / Chapter 6 / Article 10 / Section 1609
20-1609 Filing, approval and disapproval of forms
Status: in_force

20-1609. Filing, approval and disapproval of forms

A. A person shall not use or issue for delivery in this state a policy, certificate of insurance, application for insurance, endorsement or rider that relates to consumer credit insurance unless the person has first filed the form with the director and the director has approved the form.  A person shall file each form with the director at least thirty days before using the form.  Unless the director issues an order affirmatively approving or disapproving the form within thirty days after the filing, the form is deemed approved.  On written notice given within the thirty day period to the person making the filing, the director may extend the period for review up to fifteen additional days to enable the director to complete the review of the filing.

B. The director shall disapprove any form filed pursuant to subsection A if the form contains provisions that are unjust, unfair, inequitable, misleading, ambiguous or deceptive, that encourage misrepresentations of the coverage or that are contrary to any provision of this title or of any rule adopted pursuant to this title.

C. If the director disapproves any form or determines that approval once given should be withdrawn, the director shall notify the insurer of the reason for the decision and advise the insurer of the hearing procedure prescribed by title 41, chapter 6, article 10.
A.R.S. § 20-1406.09 — Arizona Code / Title 20 / Chapter 6 / Article 5 / Section 1406.09
20-1406.09 Coverage of health care services
Status: in_force

20-1406.09. Coverage of health care services

All policies issued, delivered or renewed on or after July 1, 2017 by a group or blanket disability insurer in this state must provide coverage for lawful health care services that are provided by a health care provider to an insured regardless of the familial relationship of the health care provider to the insured if the health care service would be covered were it provided to an insured who was not related to the health care provider.  The policy may limit the coverage to those health care providers who are members of the insurer's provider network.  This section does not apply to disability income.
A.R.S. § 20-400 — Arizona Code / Title 20 / Chapter 2 / Article 4.2 / Section 400
20-400 Scope of provisions
Status: in_force

20-400. Scope of provisions

A. This article applies to all insurers having a certificate of authority issued by the director to transact insurance in this state except:

1. Reinsurance.

2. Annuities.

3. Title insurance.

4. Mortgage guaranty insurance.

5. Disability or life insurance.

6. Risks subject to section 20-395.

7. Risks commonly insured under marine and inland marine insurance policies.

8. Personal lines automobile, dwelling and homeowner insurance policies.

9. Any policy of insurance against loss or damage to or legal liability in connection with property located outside this state, any motor vehicle or aircraft principally garaged and used outside this state or any activity wholly carried on outside this state.

B. This article does not apply to hospital service or medical service corporations, investment companies, mutual benefit associations or fraternal beneficiary associations.
A.R.S. § 20-452.01 — Arizona Code / Title 20 / Chapter 2 / Article 6 / Section 452.01
20-452.01 Designation of particular insurer or person transacting insurance prohibited
Status: in_force

20-452.01. Designation of particular insurer or person transacting insurance prohibited

No person engaged in the business of financing the purchase of real or personal property or of lending money on the security of real or personal property, and no trustee, director, officer, agent or other employee, or affiliate of, any such person shall require, as a condition precedent to financing the purchase of such property or to lending money upon the security thereof, or as a condition prerequisite for the renewal or extension of any such loan or for the performance of any other act in connection therewith, that the person for whom such purchase is to be financed or to whom the money is to be loaned, or for whom such extension, renewal or other act is to be granted or performed, negotiate any insurance or renewal thereof covering such property through a particular insurer or person transacting insurance.
A.R.S. § 20-173 — Arizona Code / Title 20 / Chapter 1 / Article 2 / Section 173
20-173 Residence requirement; exemption for officer representing insurer
Status: in_force

20-173. Residence requirement; exemption for officer representing insurer

Notwithstanding the provision of section 38-201, subsection A, to the contrary, a member of a guaranty fund board established pursuant to this title, chapter 3, article 6 or 7, who is appointed to represent an insurer or group of insurers, need not be a resident of this state.
A.R.S. § 20-122 — Arizona Code / Title 20 / Chapter 1 / Article 1 / Section 122
20-122 Health care sharing ministries; exemption from regulation; definition
Status: in_force

20-122. Health care sharing ministries; exemption from regulation; definition

A. A health care sharing ministry's practices do not constitute the transaction of insurance business in this state for the purposes of regulation under this title.

B. For the purposes of this section, "health care sharing ministry" means a nonprofit organization that is exempt from federal income tax under section 501 of the internal revenue code and that:

1. Limits its participants to those who share a common set of ethical or religious beliefs.

2. Meets the requirements of 26 United States Code section 5000A(d)(2)(B)(i) and (ii)(I), (II), (III) and (V).

3. Acts as a facilitator among participants who have financial or medical needs and matches those participants with other participants who have the ability to assist those with financial or medical needs consistent with the criteria established by the health care sharing ministry.

4. Provides for the financial and medical needs of a participant through contributions from one participant to another.

5. Suggests amounts that participants may contribute with no assumption of risk or promise to pay among the participants and no assumption of risk or promise to pay by the health care sharing ministry to the participants.

6. Provides a written monthly statement to all participants that lists the total dollar amount of qualified needs submitted to the health care sharing ministry and the amount actually published or assigned to participants for their contribution.

7. Provides a written disclaimer on or accompanying all applications and guideline materials distributed by or on behalf of the ministry that reads, in substance:

Notice: The organization facilitating the sharing of medical expenses is not an insurance company and the ministry's guidelines and plan of operation are not an insurance policy. Whether anyone chooses to assist you with your medical bills will be completely voluntary because participants are not compelled by law to contribute toward your medical bills.  Therefore, participation in the ministry or a subscription to any of its documents should not be considered to be insurance. Regardless of whether you receive any payment for medical expenses or whether this ministry continues to operate, you are always personally responsible for the payment of your own medical bills.
A.R.S. § 20-1096.01 — Arizona Code / Title 20 / Chapter 4 / Article 12 / Section 1096.01
20-1096.01 Formation of mechanical reimbursement reinsurer; articles of incorporation
Status: in_force

20-1096.01. Formation of mechanical reimbursement reinsurer; articles of incorporation

A. Five or more individuals who are eighteen years of age or older may incorporate as a mechanical reimbursement reinsurer. Not less than two-thirds of the incorporators shall be citizens of the United States residing in this state.

B. In addition to the requirements of title 10, chapter 2, article 1, the articles of incorporation shall state:

1. The limitation upon the powers of the corporation consistent with this article.

2. The number of directors, not less than five nor more than fifteen, who shall conduct the affairs of the corporation and the names and addresses of the corporation's first directors and officers for stated terms of office of not less than two months or more than one year.

3. The time of the annual meeting of shareholders.

4. The city or town in this state in which the principal place of business is to be located and the counties, states and countries in which business may be transacted.

5. The limitations, if any, on the corporation's indebtedness.

6. The extent, if any, to which stock of the corporation is liable to assessment.
A.R.S. § 20-1721 — Arizona Code / Title 20 / Chapter 7 / Article 2 / Section 1721
20-1721 Health care insurers; policy limits; eligibility; rates; applicability to other insurers; restrictions
Status: in_force

20-1721. Health care insurers; policy limits; eligibility; rates; applicability to other insurers; restrictions

A. Any person, pursuant to this article and to the otherwise applicable provisions of title 20, to the extent that such other provisions are not inconsistent with this article, may establish a domestic stock insurance company, a domestic mutual insurance company or a reciprocal insurer, to issue professional liability and related casualty insurance to any licensed health care provider holding a valid, nonsuspended license or permit issued by this state.

B. Until October 1, 1980, the following provisions shall apply to the offering of primary coverage professional liability insurance by health care insurers:

1. Primary coverage shall be made available by such insurers to every licensed health care provider currently holding a nonsuspended permit or license issued by this state and providing health care services in this state.

2. A health care insurer may reduce the scope of its insurance coverage for any insured who has his license or permit restricted by his licensing agency or board in accordance with such restriction, or may terminate coverage if such insured has his license or permit suspended or revoked.

3. The rates for such coverage shall reflect past and prospective loss and expense experience relating to that type of licensed health care provider and reasonably recognized prior claims experience of the insured and shall be applied on the basis of standard underwriting practices in the insurance industry.

4. The rates for such coverage may include assessments and surcharges for negative underwriting experience.

C. On or after October 1, 1980, health care insurers shall not be subject to the provisions contained in subsection B, but shall offer coverage as otherwise provided by this title.

D. Coverage exceeding the limits of primary coverage may be made available by health care insurers to licensed health care providers satisfying the insurer's underwriting policies which may be established from time to time.
A.R.S. § 20-1097.08 — Arizona Code / Title 20 / Chapter 4 / Article 13 / Section 1097.08
20-1097.08 Advertising and solicitation of legal services
Status: in_force

20-1097.08. Advertising and solicitation of legal services

The director may require that any advertising or sales material for use in the sale or the presentation for sale of any legal insurance contract be approved by him. Ten days after written demand from the director, the corporation shall provide the advertising or sales material to the department. The director shall disapprove the material should he determine that it is in whole or in part false, deceptive or misleading and shall notify the corporation of his disapproval within thirty days of receipt of the material.
A.R.S. § 20-221 — Arizona Code / Title 20 / Chapter 2 / Article 1 / Section 221
20-221 Director as agent for service of process
Status: in_force

20-221. Director as agent for service of process

A. Each authorized foreign or alien insurer shall appoint the director as its attorney to receive service of legal process issued against it in this state. The appointment shall be irrevocable, shall bind any successor in interest or to the assets or liabilities of the insurer and shall remain in effect as long as there is in force in this state any contract made by the insurer or obligations arising therefrom.

B. Service of process against a foreign or alien insurer shall be made only by service of process upon the director. Service of process against a domestic insurer shall be made upon the insurer corporation in the manner provided by laws applying to corporations generally, or upon the insurer's attorney-in-fact if a reciprocal insurer.

C. Each foreign or alien insurer at the time of application for a certificate of authority shall file with the director the name and address of a designated person to whom process against it served upon the director is to be forwarded. The insurer may change such designation by a new filing.

D. Any authorized domestic insurer who does not have or maintain a statutory agent shall appoint the director as its attorney to receive service of legal process issued against it in this state.
A.R.S. § 20-3454 — Arizona Code / Title 20 / Chapter 27 / Article 1 / Section 3454
20-3454 Acknowledgement of receipt of an application; notification of incomplete applications
Status: in_force

20-3454. Acknowledgement of receipt of an application; notification of incomplete applications

A. When submitting a credentialing application, a health insurer shall provide written or electronic acknowledgement to an applicant within seven calendar days after the health insurer's receipt of the application.  The applicant shall include in the application a contact name, telephone number and email address of an individual who can address discrepancies in the application.

B. On receipt of an application, a health insurer shall promptly review the application to determine if the application is complete.

C. Not later than seven calendar days after receipt of a credentialing application, a health insurer shall contact the applicant in writing or by electronic means to acknowledge receipt of the application and inform the applicant whether the application is a complete credentialing application. If the application is not a complete credentialing application, the notice shall include a detailed list of all of the items required to complete the application. A health insurer may request supplemental information to complete the credentialing process.

D. If the health insurer does not send the notice to the applicant within the required time frame specified in this section, the application is deemed complete for the purposes of section 20-3453.

E. If the health insurer notifies the applicant pursuant to subsection C of this section that the application is not a complete credentialing application, the time periods specified under section 20-3453 are tolled, and the application is suspended from the date the notification was sent to the applicant until the date on which the health insurer receives the information from the applicant to complete the application. Not later than seven calendar days after the applicant submits information to complete the application, the health insurer shall contact the applicant to acknowledge receipt of the additional information and inform the applicant whether the application is a complete credentialing application. If the health insurer has not received any response providing the requested information in subsection C of this section from the applicant after thirty calendar days, the health insurer may deem the application withdrawn and communicate the withdrawal of the application to the applicant within seven calendar days.

F. If at any time during the application process the health insurer tolls the time period specified in section 20-3453 while waiting for additional information from the applicant, the health insurer shall acknowledge receipt of the additional information not later than seven calendar days after the health insurer receives the additional information. The health insurer shall provide all notifications to the applicant in this subsection in writing or by electronic means.

G. A health insurer may not toll the time period specified in section 20-3453 more than three times. If, after the third toll, a health insurer has not received a response from the applicant that includes the requested information as prescribed in subsection C of this section within thirty calendar days, the health insurer may deem the application withdrawn and shall inform the applicant of the withdrawal within seven calendar days.

H. On receipt of a complete credentialing application, a health insurer must send the applicant a proposed contract that is complete and ready for execution by the parties.

I. A health insurer that enters into a delegated credentialing agreement with a licensed health care facility or that participates in a health insurer credentialing alliance with equivalent or higher standards than as prescribed in this section is deemed to be in compliance with the requirements of this section.
A.R.S. § 20-1357 — Arizona Code / Title 20 / Chapter 6 / Article 4 / Section 1357
20-1357 Optional policy provisions
Status: in_force

20-1357. Optional policy provisions

Except as provided in subsection B of section 20-1344, no such policy delivered or issued for delivery to any person in this state shall contain provisions respecting the matters set forth in sections 20-1358 to 20-1368, inclusive, unless the provisions are in the words in which such provisions appear in the applicable section, except that the insurer may, at its option, use in lieu of any such provision a corresponding provision of different wording approved by the director which is not less favorable in any respect to the insured or the beneficiary. Any such provision contained in the policy shall be preceded individually by the appropriate caption or, at the option of the insurer, by such appropriate individual or group captions or subcaptions as the director may approve.
A.R.S. § 20-650 — Arizona Code / Title 20 / Chapter 3 / Article 4 / Section 650
20-650 Recovery of shareholder liability
Status: in_force

20-650. Recovery of shareholder liability

A. The receiver of an insurer may file a claim in the receivership proceeding to recover the liability of shareholders under article XIV, section 11, Constitution of Arizona.

B. Any amount recovered in an action under this section shall be distributed in the same manner provided by law for the distribution of general assets of the estate.

C. The receiver shall bring an action pursuant to subsection A of this section, within four years of the entry of an order of liquidation or other order fixing the rights and liabilities of shareholders under section 20-635.

D. In an action pursuant to this section:

1. The defendant is not entitled to offset obligations of the insurer to the defendant, except that a defendant may file a claim with the receiver for those obligations.

2. The receiver shall recover costs and reasonable attorney fees.
A.R.S. § 20-1376.03 — Arizona Code / Title 20 / Chapter 6 / Article 4 / Section 1376.03
20-1376.03 Prohibiting denial of contract benefits; nurses; reimbursement
Status: in_force

20-1376.03. Prohibiting denial of contract benefits; nurses; reimbursement

If a disability insurance contract provides or offers reimbursement for any service which is within the scope of the practice of a registered nurse practitioner or a certified registered nurse qualified under the rules adopted by the state board of nursing regarding extended nursing practice and licensed pursuant to title 32, chapter 15, the contract benefits shall not be denied to a subscriber who receives the services of the certified registered nurse or registered nurse practitioner. The cost of the service may be reimbursed directly to the certified registered nurse or registered nurse practitioner or to the subscriber if another provider or health care institution was not reimbursed for the cost of the service.
A.R.S. § 20-1592 — Arizona Code / Title 20 / Chapter 6 / Article 9 / Section 1592
20-1592 Records
Status: in_force

20-1592. Records

A. Every domestic title insurer shall, except as hereinafter provided, keep and maintain at its principal office in this state:

1. A true copy of its articles of incorporation as filed in the office of the corporation commission, and the original of its by-laws,

2. Its books of account,

3. A record containing the names and addresses of its stockholders, the number and class of shares held by each and the dates when they respectively became the owners of record thereof, and

4. The minutes of any meetings of its stockholders, board of directors and committees thereof.

B. A domestic title insurer may keep and maintain its books of account without this state if, in accordance with a plan adopted by its board of directors and approved by the director, it maintains in this state suitable records in lieu thereof; provided, however, that the director may after notice and hearing direct such title insurer to return all or any of its books of account to this state if such return is reasonably necessary (1) to protect the interests of the people of this state, or (2) to permit their inspection in this state by a director or stockholder who has shown to the satisfaction of the director that he has made an application to such title insurer for inspection of such books in good faith and for a necessary and legitimate purpose, and that such title insurer has either declined to permit such inspection or to agree to pay any additional expenses reasonably to be incurred by the applicant, or his agent or attorney, in connection with the inspection of such books as a result of their maintenance without this state. If in the judgment of the director delay in the return of any or all books of account of such title insurer may be hazardous, or may cause irreparable injury, to the people of this state or to the policyholders of such title insurer, he may direct the return thereof without notice and hearing.
A.R.S. § 20-1693.03 — Arizona Code / Title 20 / Chapter 6 / Article 17 / Section 1693.03
20-1693.03 Portable electronics vendors; authority; charges for portable electronics insurance; accounting
Status: in_force

20-1693.03. Portable electronics vendors; authority; charges for portable electronics insurance; accounting

A. The employees and authorized representatives of vendors may sell or offer portable electronics insurance to customers and shall not be subject to licensure as an insurance producer under this title or be subject to the continuing education requirements of this title if:

1. The vendor obtains a license to authorize its employees or authorized representatives to sell or offer portable electronics insurance pursuant to this article.

2. Each vendor or its designee provides a training program that gives the vendor's employees and authorized representatives basic instruction about coverage under a portable electronics insurance policy and the requirements of this article.

B. Notwithstanding any other law, a vendor of portable electronics or its employees or authorized representatives shall not advertise, represent or otherwise be portrayed as licensed insurers or insurance producers unless so licensed.

C. The vendor may bill and collect the charges for portable electronics insurance coverage. Any charge to the enrolled customer for coverage that is not included in the cost associated with the purchase or lease of portable electronics or related services shall be separately itemized on the enrolled customer's bill. If the portable electronics insurance coverage is included with the purchase or lease of portable electronics or related services, the vendor shall clearly and conspicuously disclose to the enrolled customer that the portable electronics insurance coverage is included with the portable electronics or related services.  A vendor that bills and collects charges for insurance coverage included with the purchase or lease of portable electronics or related services is not required to maintain those monies in a segregated account if the vendor is authorized by the insurer to hold those monies in an alternative manner and remits these monies to the supervising entity within sixty days of receipt. All monies received by a vendor from an enrolled customer for the sale of portable electronics insurance shall be considered monies held in trust by the vendor in a fiduciary capacity for the benefit of the insurer.

D. Vendors may receive compensation for billing and collection services.
A.R.S. § 20-696.02 — Arizona Code / Title 20 / Chapter 3 / Article 8 / Section 696.02
20-696.02 General requirements; statement of actuarial opinion; qualified actuary; appointed actuary; analysis
Status: in_force

20-696.02. General requirements; statement of actuarial opinion; qualified actuary; appointed actuary; analysis

A. The following apply to the submission of statements of actuarial opinion:

1. Pursuant to section 20-696.03, a company shall include with or attach to page one of its annual statement the statement of actuarial opinion that is made by an appointed actuary and that states an opinion relating to reserves and related actuarial items held in support of policies and contracts.

2. On written request by the company, the director may grant an extension of the date for submission of the statement of actuarial opinion.

B. A qualified actuary is an individual who meets the following requirements:

1. Is a member in good standing of the American academy of actuaries.

2. Is qualified to sign statements of actuarial opinion for life and health insurance company annual statements pursuant to the American academy of actuaries qualification standards for actuaries signing these statements.

3. Is familiar with the valuation requirements that are applicable to life and health insurance companies.

4. Has not been found by the director, after appropriate notice and hearing and without subsequent reinstatement as a qualified actuary, to have done any of the following:

(a) Violated any provision of or any obligation imposed by this title or other law in the course of the person's conduct as a qualified actuary.

(b) Been convicted of a fraudulent or dishonest practice.

(c) Demonstrated incompetence, lack of cooperation or untrustworthiness to act as a qualified actuary.

(d) Pursuant to this article, submitted to the director during the past five years an actuarial opinion or memorandum that the director rejected because it did not meet the requirements prescribed by this article, including standards prescribed by the actuarial standards board.

(e) Resigned or been removed as an actuary within the past five years as a result of acts or omissions that are indicated in any adverse report on examination or as a result of failure to adhere to generally acceptable actuarial standards.

5. Has notified the director of any action taken against the actuary by the director or commissioner of another state for an act that is prohibited under paragraph 4 of this subsection.

C. Notwithstanding subsection B, paragraph 4 of this section, for good cause shown the director may classify an individual as a qualified actuary.

D. An appointed actuary is a qualified actuary who is appointed or retained to prepare the statement of actuarial opinion that is required by this article, either directly by or by the authority of the board of directors through an executive officer of the company who shall not be the qualified actuary.  The company shall give the director timely written notice of the name and title of the appointed actuary, the name of the firm if the actuary is a consulting actuary, and the manner of appointment or retention of each person who is appointed or retained by the company as an appointed actuary, and shall state that the person meets the requirements of subsection B of this section. After the company furnishes this notice, no further notice is required with respect to this person, except that the company shall give the director timely written notice if the actuary ceases to be appointed or retained as an appointed actuary or fails to meet the requirements prescribed in subsection B of this section. If a person who is appointed or retained as an appointed actuary replaces a previously appointed actuary, the notice shall state this and shall give the reasons for the replacement.

E. The asset adequacy analysis required by this article shall:

1. Conform to the actuarial standards of practice as promulgated by the actuarial standards board in effect on the effective date of this article and to any additional standards pursuant to this article that form the basis of the statement of actuarial opinion pursuant to this article.

2. Be based on methods of analysis as are deemed appropriate for these purposes by the actuarial standards board.

F. Liabilities shall be covered in the actuarial opinion as follows:

1. Pursuant to section 20-510, subsection E or F, the statement of actuarial opinion applies to all in force business on the statement date, whether directly issued or assumed and regardless of when or where issued.

2. If the appointed actuary determines as the result of an asset adequacy analysis that a reserve should be held in addition to the aggregate reserve held by the company and calculated pursuant to the methods prescribed in section 20-510, the company shall establish the additional reserve.

3. Additional reserves that are established under paragraph 2 of this subsection and that are deemed unnecessary in subsequent years may be released.  Any amounts released shall be disclosed in the actuarial opinion for the applicable year. The release of these reserves is not deemed an adoption of a lower standard of valuation.
A.R.S. § 20-2538 — Arizona Code / Title 20 / Chapter 15 / Article 2 / Section 2538
20-2538 Independent review organizations
Status: in_force

20-2538. Independent review organizations

A. Pursuant to title 41, chapter 23, the director shall procure as many independent review organizations as necessary and practicable to perform the independent medical reviews described in section 20-2537.

B. Through the procurement process the director shall ensure that any procured independent review organization uses physicians or other health care professionals who are licensed pursuant to title 32, chapter 7, 8, 11, 13, 14, 17, 19, 19.1 or 29 or out of state physicians or other health care professionals who are licensed in another state and who are not licensed in this state, who are board certified or board eligible by the appropriate American medical specialty board and who are in the same or a similar scope of practice as a physician or another health care professional who is licensed pursuant to title 32, chapter 7, 8, 11, 13, 14, 17, 19, 19.1 or 29 or an out of state physician or another health care professional who is licensed in another state and who is not licensed in this state and who typically manages the medical condition, procedure or treatment under review.

C. The independent review organization and its individual reviewer shall not have a substantial interest in the member, provider or health care insurer involved in the particular case under review or any other conflict of interest that will preclude the reviewer from making a fair and impartial decision.  The individual reviewer shall not be a policyholder or insured member of a company whose case is being reviewed.

D. An out of state physician or another health care professional who is licensed in another state and who is not licensed in this state in a field substantially similar to the laws of this state applicable to physicians or other health care professionals who are licensed under title 32, chapter 7, 8, 11, 13, 14, 16, 17, 19, 19.1 or 29 and who are certified or board eligible by the appropriate American medical specialty board may serve as an independent reviewer for the procured independent review organization and that provider's analysis, assessment or decision for the independent review organization does not constitute the practice of medicine or any other health care profession in this state.

E. The director, any procured independent review organization or any independent reviewer acting in good faith is not liable for the analysis, assessment or decision of any case reviewed pursuant to this article.
A.R.S. § 20-1662 — Arizona Code / Title 20 / Chapter 6 / Article 13 / Section 1662
20-1662 Requirements to transact mass marketed insurance
Status: in_force

20-1662. Requirements to transact mass marketed insurance

An insurer extending mass marketed life or health insurance under a group or blanket policy issued outside this state to residents of this state shall, before offering coverage to the citizens of this state:

1. Make available for the purpose of determining compliance with this article copies of any such policy or certificates issued under such policy and advertising material used within this state in connection with such insurance.

2. Comply with the requirements of this state relating to advertising and to claims settlement practices.
A.R.S. § 20-1018 — Arizona Code / Title 20 / Chapter 4 / Article 7 / Section 1018
20-1018 Advertising matter or sales materials
Status: in_force

20-1018. Advertising matter or sales materials

A prepaid dental plan organization shall not issue or deliver any advertising matter or sales material to any person in this state until the prepaid dental plan organization files the advertising matter or sales material with the director.  This section does not require a prepaid dental plan to have the prior approval of the director to issue or deliver the advertising matter or sale material. If the director finds that the advertising matter or sales material, in whole or in part, is false, deceptive or misleading, the director may issue an order disapproving the advertising matter or sales material, directing the prepaid dental plan organization to cease and desist from issuing, circulating, displaying or using the advertising matter or sales material within a period of time specified by the director but not less than ten days and imposing any penalties prescribed in this title.  At least five days before issuing an order pursuant to this section, the director shall provide the prepaid dental plan organization with a written notice of the basis of the order to provide the prepaid dental plan organization with an opportunity to cure the alleged deficiency in the advertising matter or sales material within a single five day period for the particular advertising matter or sales material at issue. The prepaid dental plan organization may appeal the director's order pursuant to title 41, chapter 6, article 10.  Except as otherwise provided in this section, a prepaid dental plan organization may obtain a stay of the effectiveness of the order as prescribed in section 20-162. If the director certifies in the order and provides a detailed explanation of the reasons in support of the certification that continued use of the advertising matter or sales material poses a threat to the health, safety or welfare of the public, the order may be entered immediately without opportunity for cure and the effectiveness of the order is not stayed pending the hearing on the notice of appeal but the hearing shall be promptly instituted and determined.
A.R.S. § 20-481.17 — Arizona Code / Title 20 / Chapter 2 / Article 8 / Section 481.17
20-481.17 Exemption by director
Status: in_force

20-481.17. Exemption by director

The provisions of sections 20-481.09 to 20-481.16, inclusive, relating to registration, shall not apply to any insurer, information or transaction if and to the extent that the director by rule, regulation or order shall exempt the insurer, information or transaction.
A.R.S. § 20-1375 — Arizona Code / Title 20 / Chapter 6 / Article 4 / Section 1375
20-1375 Franchise disability insurance law
Status: in_force

20-1375. Franchise disability insurance law

Disability insurance on a franchise plan is declared to be that form of disability insurance issued to five or more employees of any corporation, copartnership or individual employer or any governmental corporation, agency or department thereof, or to ten or more members, employees or employees of members of any trade or professional association or of a labor union or of any other association having had an active existence for at least two years where such association or union has a constitution or bylaws and is formed in good faith for purposes other than that of obtaining insurance, where such persons, with or without their dependents, are issued the same form of an individual policy varying only as to amounts and kinds of coverage applied for by such persons under an arrangement whereby the premiums on the policies may be paid to the insurer periodically by the employer, with or without payroll deductions, or by the association for its members, or by some designated person acting on behalf of the employer or association. The term "employees" as used herein may be deemed to include the officers, managers and employees of the employer and the individual proprietor or partners if the employer is an individual proprietor or partnership.
A.R.S. § 20-488.04 — Arizona Code / Title 20 / Chapter 2 / Article 12 / Section 488.04
20-488.04 Authorized control level event
Status: in_force

20-488.04. Authorized control level event

If an authorized control level event occurs with respect to an insurer, the director shall either:

1. Take those actions that are required under section 20-488.03 regarding an insurer to whom a regulatory action level event has occurred.

2. If the director deems it to be in the best interests of the policyholders and creditors of the insurer and of the public, take any actions that are necessary to place the insurer under regulatory control pursuant to chapter 1, article 2 and chapter 3, article 4 of this title. If the director takes these actions, the authorized control level event shall be deemed to be sufficient grounds for the director to take action under chapter 1, article 2 and chapter 3, article 4 of this title, and the director has the rights, powers and duties with respect to the insurer that are set forth in chapter 1, article 2 and chapter 3, article 4 of this title. If the director takes any action under this paragraph pursuant to an adjusted RBC report, the insurer is entitled to the same protection that is afforded to insurers under chapter 1, article 2 and chapter 3, article 4 of this title.
A.R.S. § 20-266 — Arizona Code / Title 20 / Chapter 2 / Article 2 / Section 266
20-266 Minimum liability policy; availability
Status: in_force

20-266. Minimum liability policy; availability

An insurer writing or an insurance producer soliciting applications for motor vehicle liability policies that insure six or fewer motor vehicles shall make available a policy for the mandatory minimum motor vehicle liability limits as prescribed in section 28-4009 if requested by a named insured or an applicant who meets the underwriting criteria of the insurer.
A.R.S. § 20-704 — Arizona Code / Title 20 / Chapter 4 / Article 1 / Section 704
20-704 Applicability of general corporation laws
Status: in_force

20-704. Applicability of general corporation laws

The general statutes of this state relating to corporations formed for profit, except where inconsistent with the provisions of this title and the reasonable implications thereof, shall apply to domestic stock and mutual insurers.
A.R.S. § 20-1402.04 — Arizona Code / Title 20 / Chapter 6 / Article 5 / Section 1402.04
20-1402.04 Contracts; dentists; covered services; definition
Status: in_force

20-1402.04. Contracts; dentists; covered services; definition

A. A contract, entered into or renewed on or after January 1, 2011, between a group disability insurer and a dentist who is licensed to practice in this state shall not require the dentist to provide services to an individual covered under a group disability policy based on a fee set by the group disability insurer unless the services for which the fee applies is a covered service under the individual's group disability policy.

B. This section does not restrict the ability of a group disability insurer to establish dental benefits for services offered by plans that are administered but not insured by the group disability insurer.

C. For the purposes of this section, "covered service" means a service for which any reimbursement is available under a group disability policy without regard to contractual limitations by a deductible, copayment, coinsurance, waiting period, annual or lifetime maximum, frequency limitation, alternative benefit payment, exclusion or other limitation.
A.R.S. § 20-482.02 — Arizona Code / Title 20 / Chapter 2 / Article 8.1 / Section 482.02
20-482.02 Required filings; approval by director and members
Status: in_force

20-482.02. Required filings; approval by director and members

A. A domestic mutual insurer may engage in a conversion as part of a reorganization as a mutual holding company, only if the board passes a resolution that the reorganization is fair and equitable to the policyholders and adopts a plan that meets the requirements of this article.

B. After the board has adopted a plan and before the board seeks approval of the plan by the eligible members of the converting mutual insurer, the converting mutual insurer shall file the following documents with the director:

1. The plan of reorganization.

2. The form of notice of the meeting at which the eligible members vote on the plan.

3. The form of any proxies to be solicited from the eligible members. Proxies must offer the eligible members the option of voting in favor of or voting against the plan or abstaining from voting.

4. Information required by the converting mutual insurer's bylaws.

5. Other information or documentation required by the director.

C. The director shall approve or disapprove a plan and other documents submitted under subsection B of this section as prescribed in section 20-482.04. The director must approve or disapprove the plan within sixty days after the director receives a completed filing of the plan and all information requested by the director or within sixty days after the completion of a hearing on the plan, whichever date is later.

D. At any time before the director approves a plan, the board may amend or withdraw the plan.

E. After the director approves a plan, the eligible members of the converting mutual insurer must approve the plan. Approval by the eligible members is subject to the following requirements:

1. All eligible members must be given notice of the plan and of their opportunity to vote on the plan.  A copy of the plan or a summary of the plan must accompany the notice. The notice shall be mailed to the last known address of each eligible member, as shown on the records of the converting mutual insurer, within forty-five days after the director approves the plan. The meeting of the eligible members at which a vote on the plan will occur shall be set for a date that is not earlier than the thirtieth day after the date on which the mutual insurer mailed the notice of the meeting. If the converting mutual insurer complies substantially and in good faith with the notice requirements of this paragraph, the converting mutual insurer's failure to give any member or members any required notice does not impair the validity of any action taken under this section.

2. The vote required for approval must be conducted in accordance with the converting mutual insurer's bylaws, except as follows:

(a) Only eligible members may vote on the plan.

(b) An eligible member may vote in person or by proxy at the meeting at which the plan is voted on.

(c) The plan is approved by the eligible members on the affirmative vote of two-thirds or more of the eligible members voting on the plan, unless the bylaws require a greater number of affirmative votes.  The converting mutual insurer shall file with the director a certification that the plan of reorganization has been duly adopted by a vote of at least two-thirds of the eligible members.

F. The plan shall be carried out in accordance with its terms on the effective date of the reorganization.

G. Except as otherwise provided in this section, all information and documents obtained by or disclosed to the director or any other person in the course of preparing, filing and processing an application to reorganize, other than information and documents distributed to policyholders or filed and submitted as evidence in connection with a public hearing held pursuant to section 20-482.04, are confidential and not subject to subpoena and must not be made public except to insurance departments of other states, with the prior written consent of the insurer to which such information and documents pertain.
A.R.S. § 20-1403 — Arizona Code / Title 20 / Chapter 6 / Article 5 / Section 1403
20-1403 Direct payment of hospital and medical services
Status: in_force

20-1403. Direct payment of hospital and medical services

Any group disability policy may provide that all or any portion of any indemnities provided by any such policy on account of hospital, nursing, medical or surgical services may, at the insurer's option, be paid directly to the hospital or person rendering such services, but the policy may not require that the service be rendered by a particular hospital or person. Payments so made shall discharge the insurer's obligation with respect to the amount of insurance so paid.
A.R.S. § 20-242 — Arizona Code / Title 20 / Chapter 2 / Article 1 / Section 242
20-242 Health insurers; provider networks; notice; options; definitions
Status: in_force

20-242. Health insurers; provider networks; notice; options; definitions

A. If a health insurer acquires the provider network of another health insurer, the health insurer that is contracted with a health care provider in the network that has been acquired shall notify, consistent with the notification provisions of the provider contract, each health care provider of the acquired network.

B. A health care provider that is in a provider network that is acquired may do any of the following:

1. Continue the provider relationship with the health insurer that acquired the provider network.

2. Terminate the provider relationship with the health insurer that acquired the provider network in a time and manner consistent with the contract between the health care provider and the health insurer that is contracted with the health care provider.

3. Enter into a contract directly with the health insurer that acquired the provider network.

C. This section does not apply to acquisitions or arrangements that are disclosed in the network contract between a health care provider and a health insurer and to which the health care provider has already agreed.

D. For the purposes of this section:

1. "Health care provider" means a person who is licensed, registered or certified as a health care professional under title 32 or a laboratory or durable medical equipment provider that furnishes services to an enrollee and that separately bills the enrollee for the services.

2. "Health insurer" means a disability insurer, group disability insurer, blanket disability insurer, health care services organization, hospital service corporation, medical service corporation or hospital, medical, dental and optometric service corporation and includes the health insurer's designee.
A.R.S. § 20-3321 — Arizona Code / Title 20 / Chapter 25 / Article 1 / Section 3321
20-3321 Definitions
Status: in_force

20-3321. Definitions

In this chapter, unless the context otherwise requires:

1. "Auditing entity" means any person, company, group or plan working on behalf of or pursuant to a contract with an insurer or pharmacy benefits manager for the purposes of auditing pharmacy drug claims adjudicated by pharmacies.

2. "Clerical errors" means a minor recordkeeping or transcribing error, including typographical errors, scrivner's errors or computer errors, in a required electronic or hard copy document, record or prescription order if both of the following criteria are met:

(a) The error did not result in actual financial harm to an entity.

(b) The error did not involve dispensing an incorrect dose or type of medication or dispensing a prescription drug to the wrong person.

3. "Desktop audit" means an audit that is conducted by an auditing entity at a location other than the location of the pharmacist or pharmacy.  Desktop audit includes an audit that is performed at the offices of the auditing entity during which the pharmacist or pharmacy provides requested documents for review by hard copy or by microfiche, disk or other electronic media.

4. "In-pharmacy audit" means an audit that is conducted by an auditing entity at the physical business address of the pharmacy where the claim was adjudicated.

5. "Insurer" means a disability insurer, group disability insurer, blanket disability insurer, health care services organization, hospital service corporation, medical service corporation or hospital and medical service corporation.

6. "List" means the list of drugs for which a pharmacy benefit manager has established a maximum allowable cost.

7. "Maximum allowable cost":

(a) Means the maximum amount that a pharmacy benefit manager will reimburse a pharmacy for the cost of a multisource drug.

(b) Does not include the dispensing fee for the drug.

8. "Pharmacist" has the same meaning prescribed in section 32-1901.

9. "Pharmacy" has the same meaning prescribed in section 32-1901.

10. "Pharmacy benefit manager" means a person, business or other entity that, pursuant to a contract or under an employment relationship with an insurer or other third-party payor, either directly or through an intermediary manages the prescription drug coverage provided by the insurer or other third-party payor, including the processing and payment of claims for prescription drugs, the performance of drug utilization review, the processing of drug prior authorization requests, the adjudication of appeals or grievances related to prescription drug coverage, contracting with network pharmacies and controlling the cost of covered prescription drugs.
A.R.S. § 20-2206 — Arizona Code / Title 20 / Chapter 12 / Article 1 / Section 2206
20-2206 Approval of plan of operation
Status: in_force

20-2206. Approval of plan of operation

A. The plan of operation prepared pursuant to section 20-2205 is subject to approval by the director after consultation with the members of the association and other affected individuals and organizations. If the director disapproves all or any part of the proposed plan of operation, the directors of the association, within fifteen days, shall submit for review an appropriate revised plan of operation or a part of a revised plan. If the directors of the association fail to act, the director shall promulgate a plan of operation or a part of a plan, whichever is appropriate. The plan of operation approved or promulgated by the director becomes effective and operational on order of the director.

B. A plan of operation shall require the association to issue a claims-made policy. Pending the approval of the plan of operation, the association shall designate a service company or service companies to bind the association for the coverage. The policies shall make provision for payment of dividends.
A.R.S. § 20-502 — Arizona Code / Title 20 / Chapter 3 / Article 1 / Section 502
20-502 Assets as deductions from liabilities
Status: in_force

20-502. Assets as deductions from liabilities

Assets may be allowed as deductions from corresponding liabilities, and liabilities may be charged as deductions from assets, and deductions from assets may be charged as liabilities, in accordance with the form of annual statement applicable to such insurer as prescribed by the director, or otherwise in his discretion.
A.R.S. § 20-396 — Arizona Code / Title 20 / Chapter 2 / Article 4.1 / Section 396
20-396 Hearing and judicial review
Status: in_force

20-396. Hearing and judicial review

Any insurer, rate service organization or advisory organization to which the director has issued an order or decision may request a hearing pursuant to title 41, chapter 6, article 10 and, except as provided in section 41-1092.08, subsection H, seek judicial review pursuant to title 12, chapter 7, article 6.
A.R.S. § 20-481.09 — Arizona Code / Title 20 / Chapter 2 / Article 8 / Section 481.09
20-481.09 Registration of insurers; deadline
Status: in_force

20-481.09. Registration of insurers; deadline

A. Every insurer that is authorized to do business in this state and that is a member of an insurance holding company system shall register with the director, except a foreign insurer subject to registration requirements and standards adopted by statute or regulation in the jurisdiction of its domicile that are substantially similar to those contained in this article.

B. Any insurer that is subject to registration under this article shall register within fifteen days after the insurer becomes subject to registration and by March 31 of each year unless the director for good cause extends the time for registration.

C. The director may require any authorized insurer that is a member of an insurance holding company system that is not subject to registration under this section to furnish a copy of the registration statement, the summary prescribed in section 20-481.10 or other information filed by such insurance company with the insurance regulatory authority of its domiciliary jurisdiction.
A.R.S. § 20-391 — Arizona Code / Title 20 / Chapter 2 / Article 4.1 / Section 391
20-391 Joint underwriting and joint reinsurance organizations; filing with director
Status: in_force

20-391. Joint underwriting and joint reinsurance organizations; filing with director

A. Every group, association or other organization of insurers which engages in joint underwriting or joint reinsurance through such group, association or organization or by standing agreement among the members shall file with the director:

1. A copy of its constitution, articles of association and bylaws.

2. A list of its members.

3. The name and address of a resident of this state upon whom notices or orders of the director or process may be served.

B. Every such group, association or other organization shall notify the director promptly of any change in the documents required to be filed with the director.

C. If after a hearing the director finds that any activity or practice of any such group, association or other organization is inconsistent with this article, the director may issue a written order specifying the inconsistencies and requiring the discontinuance of such activity or practice.
A.R.S. § 20-1691.04 — Arizona Code / Title 20 / Chapter 6 / Article 15 / Section 1691.04
20-1691.04 Requirements for certain group coverage
Status: in_force

20-1691.04. Requirements for certain group coverage

A. Before advertising, marketing or offering a policy within this state issued to a group defined in section 20-1691, paragraph  4, subdivision (c), the association or the insurer of the association shall file evidence with the director that the association meets all of the following requirements:

1. Consists of at least one hundred persons.

2. Has been organized and maintained in good faith for purposes other than obtaining insurance.

3. Has been in active existence for at least one year.

4. Has a constitution and bylaws that prescribe all of the following:

(a) That the association holds regular meetings at least annually to further the purposes of the members.

(b) Except for credit unions, that the association collects dues or solicits contributions from members.

(c) That the members have voting privileges and representation on the governing board and committees.

B. Thirty days after filing the evidence required by subsection A of this section, an association is deemed to satisfy the organizational requirements of subsection A of this section unless the director notifies the association or its insurer in writing that the association does not satisfy those organizational requirements.

C. An insurer may offer a group long-term care insurance policy to a group defined in section 20-1691, paragraph 4, subdivision (d) if the director finds all of the following:

1. Issuance of the group policy is not contrary to the best interest of the public.

2. Issuance of the group policy would result in economies of acquisition or administration.

3. The benefits of the policy are reasonable in relation to the premium charged.

D. A person shall not offer long-term care insurance coverage for a resident of this state under a group policy issued in another state to a group defined in section 20-1691, paragraph 4, subdivision (d) unless the state of issuance has statutory and regulatory long-term care insurance requirements substantially similar to the requirements in this state and either this state or the state of issuance has made a determination that the requirements have been met.

E. The director may prohibit further offering to a resident of this state a policy that was issued to a group as defined in section 20-1691, paragraph 4, subdivision (c) or (d) and that was initially authorized for issuance, if the director finds that the insurer does not currently meet the requirements of this article.
A.R.S. § 20-1025 — Arizona Code / Title 20 / Chapter 4 / Article 8 / Section 1025
20-1025 Surplus required
Status: in_force

20-1025. Surplus required

No attorney shall be licensed for the underwriters doing business as a Lloyd's association under this article unless the surplus of such association, required to be maintained under section 20-210, shall be at least four hundred thousand dollars in cash, or other admitted assets.
A.R.S. § 20-893 — Arizona Code / Title 20 / Chapter 4 / Article 4 / Section 893
20-893 Exemption of societies and associations and orders from insurance laws
Status: in_force

20-893. Exemption of societies and associations and orders from insurance laws

A. The following fraternal benefit societies and associations or orders are exempt from compliance with this article and all other insurance laws of this state:

1. Fraternal benefit societies that were doing business in this state on January 1, 1955 and that provide benefits exclusively through local or subordinate lodges.

2. Fraternal benefit societies that admit to membership only those persons who are engaged in one or more crafts or hazardous occupations, in the same or similar lines of business, and that insure only their own members, their families, the descendants of members and the ladies' auxiliaries to those societies.

3. Any association or order, with respect to the sale of life insurance and annuities, only if any policy or contract issued pursuant to the exemption prescribed in this subsection contains a conspicuously stamped or written notice in bold type that states:

This policy is issued by an association or order that does not possess a certificate of authority from the director of the Arizona department of insurance and financial institutions.  If the association or order that issued this policy becomes insolvent, members or claimants will not be eligible for insurance guaranty fund protection pursuant to title 20, Arizona Revised Statutes.

B. Each association or order that intends on doing business in this state and that is not licensed under this title shall provide proof satisfactory to the department that it is a nonprofit organization that is exempt from taxation under section 501(c) of the internal revenue code and is subject to the following:

1. On or before June 1 of each preceding year, each association and order shall file with the director a true and complete statement of its statutory financial condition, transactions and affairs for the preceding calendar year, audited by an independent certified public accountant, together with an actuarial memorandum issued by a qualified actuary pursuant to section 20-696.04, and shall pay a filing fee at the determination of the director. The statement and actuarial memorandum are approved thirty days after filing unless the director, within the thirty-day period, has issued an order affirmatively approving or disapproving the filing.

2. The director may require an association or order to file financial statements on a quarterly basis and may require an association or order to file financial statements on other than an annual or quarterly basis due to factors or trends affecting insurers writing a particular class or classes of business or because of changes in the management or financial or operating condition of the association or order.

3. If, in the opinion of the director, an association or order does not possess sufficient capital and surplus based on eligible assets pursuant to chapter 3, article 2 of this title to meet its liabilities, the director may order the association or order to increase its capital or surplus, or both, to amounts the director deems sufficient.  If the association or order fails to comply with the order, the director may order the association or order to cease and desist from assuming any additional liabilities in this state until such time as the association or order is able to comply with the capital and surplus requirements.

C. Except for a society prescribed by subsection A of this section, a fraternal benefit society or association or order that is exempt from the requirements of this article pursuant to this section shall not give to or allow any person any compensation for procuring new members.

D. A society that is organized and incorporated before January 1, 1955, that provides for benefits in case of death or disability resulting solely from an accident and that does not obligate itself to pay natural death or sick benefits may secure a certificate of authority under this article if it was authorized before January 1, 1955. The society has all of the privileges and is subject to all of the provisions of this article, except that the provisions of this article relating to medical examinations, standard provisions, prohibited provisions, valuations of certificates and incontestability do not apply.

E. The director by examination or otherwise may require any information that will enable the director to determine if the society or association or order is exempt from this article.
A.R.S. § 20-481.18 — Arizona Code / Title 20 / Chapter 2 / Article 8 / Section 481.18
20-481.18 Disclaimer of affiliation or control; contents; effect on duty to register
Status: in_force

20-481.18. Disclaimer of affiliation or control; contents; effect on duty to register

A. Any person may file with the director a disclaimer of affiliation or control with any authorized insurer or such a disclaimer may be filed by such insurer or any member of an insurance holding company system.

B. The disclaimer shall fully disclose all material relationships and bases for affiliation or control between such person and such insurer as well as the basis for disclaiming such affiliation or control.

C. A disclaimer of affiliation shall be deemed to have been approved unless the director within thirty days following receipt of a complete disclaimer notifies the filing party that the disclaimer is disallowed.  If the director disallows the disclaimer, the disclaiming party may request an administrative hearing, which shall be granted.  The disclaiming party is not required to register under this section if the director approves the disclaimer or if the disclaimer is deemed to have been approved.
A.R.S. § 20-508 — Arizona Code / Title 20 / Chapter 3 / Article 1 / Section 508
20-508 Reserves for disability insurance
Status: in_force

20-508. Reserves for disability insurance

For all disability insurance policies the insurer, in addition to claim reserves, shall maintain an active life reserve which shall place a sound value on its liabilities under such policies and be not less than the amounts that are necessary to assure payment of its policyholder obligations including reserves for unearned premiums.
A.R.S. § 20-774 — Arizona Code / Title 20 / Chapter 4 / Article 2 / Section 774
20-774 Deposit in lieu of bond of attorney
Status: in_force

20-774. Deposit in lieu of bond of attorney

In lieu of the bond provided for in section 20-773, the attorney may maintain on deposit with the state treasurer through the office of the director a like amount in cash or in value of securities qualified under this title as insurers' investments, and subject to the same conditions as the bond.
A.R.S. § 20-1098.22 — Arizona Code / Title 20 / Chapter 4 / Article 14 / Section 1098.22
20-1098.22 Change in plan of operations
Status: in_force

20-1098.22. Change in plan of operations

A captive insurer shall obtain the written approval of the director before implementing any material change in its plan of operations.
A.R.S. § 20-792 — Arizona Code / Title 20 / Chapter 4 / Article 2 / Section 792
20-792 Ownership of real property
Status: in_force

20-792. Ownership of real property

Legal title of real property acquired as an eligible investment in accordance with section 20-556 must be held in the name of the reciprocal insurer. Notwithstanding any other provision in this section, all deeds, notes, mortgages or other documents relating to the purchase, sale, lease, encumbrance or other interest in such real property may be executed in the name of the reciprocal insurer by its attorney-in-fact.
A.R.S. § 20-1137 — Arizona Code / Title 20 / Chapter 5 / Article 1 / Section 1137
20-1137 Limited benefit coverage; prohibited practice; definition
Status: in_force

20-1137. Limited benefit coverage; prohibited practice; definition

A. Bundling or combining various limited benefit insurance policies and advertising or indicating in any manner that these policies are major medical expense coverage policies or could be substituted for major medical expense coverage is a prohibited practice pursuant to chapter 2, article 6 of this title.

B. For the purposes of this title, "limited benefit coverage" means an insurance policy that is designed, advertised and marketed to supplement major medical insurance and that includes accident only, dental only, vision only, disability income only, fixed or hospital indemnity, specified disease insurance, credit insurance or Taft-Hartley trusts.
A.R.S. § 20-1241.01 — Arizona Code / Title 20 / Chapter 6 / Article 1.1 / Section 1241.01
20-1241.01 Scope of article
Status: in_force

20-1241.01. Scope of article

A. This article applies to the replacement of policies and contracts except for the following:

1. Credit life insurance.

2. Except as provided in subsection B of this section, group policies and contracts that do not involve direct solicitation of individuals by an insurance producer.

3. Policies and contracts used to fund prearranged funeral agreements as defined in section 32-1301.

4. Except as provided in subsection C of this section, a policy or contract that is used to fund any of the following:

(a) An employee pension and welfare plan as defined by and that is subject to the employee retirement income security act of 1974 (29 United States Code sections 1001 through 1461).

(b) A plan described by sections 401(a), 401(k) or 403(b) of the internal revenue code, where the plan, for purposes of the employee retirement income security act of 1974, is established or maintained by an employer.

(c) A governmental or church plan as defined in section 414 of the internal revenue code, a governmental or church welfare benefit plan, or a deferred compensation plan of a state or local government or a tax exempt organization pursuant to section 457 of the internal revenue code.

(d) A nonqualified deferred compensation arrangement established or maintained by an employer or plan sponsor.

5. An application to the existing insurer that issued the existing policy or contract:

(a) To exercise a contractual change or a conversion privilege.

(b) If the existing insurer is replacing the existing policy or contract pursuant to a program filed with and approved by the director.

(c) If a term conversion privilege is exercised among corporate affiliates.

6. Existing life insurance that is a nonrenewable and nonconvertible term life insurance policy that will expire in five years or less.

7. Proposed life insurance that is to replace life insurance under a binding or conditional receipt issued by the same insurer.

8. New coverage that is provided under a policy or contract if the insured's employer or an association of which the insured is a member bears all costs.

9. Immediate annuities that are purchased with proceeds from an existing contract. Immediate annuities purchased with proceeds from an existing policy are subject to this article.

10. Structured settlements as defined in section 12-2901.

11. The reinstatement of a life insurance policy pursuant to section 20-1213.

B. Group policies and contracts involving direct solicitation are subject to this article.

C. Notwithstanding subsection A of this section, this article applies to a policy or contract that is used to fund any plan or arrangement that meets all of the following requirements:

1. The plan or arrangement is funded solely by contributions an employee elects to make on a pretax or after tax basis.

2. The insurer has been notified that plan participants may choose from among two or more contract providers or policy providers.

3. The insurance producer directly solicits individual employees for the purchase of the contract or policy.

D. Registered contracts are exempt from the requirements of this article with respect to the provision of illustrations or policy summaries. Premium or contract contribution amounts and identification of the appropriate prospectus or offering circular are required.
A.R.S. § 20-1633 — Arizona Code / Title 20 / Chapter 6 / Article 11 / Section 1633
20-1633 Objections; investigation; determination
Status: in_force

20-1633. Objections; investigation; determination

A. Any individual who believes cancellation of the individual's policy is arbitrary, capricious or otherwise in violation of this article, who believes nonrenewal is in violation of this article or who believes notice of nonrenewal or cancellation, or the reasons for nonrenewal or cancellation, were not given as provided by this article, within ten days after receipt of notice, may file in writing an objection to the action with the director.

B. On receipt of a written objection pursuant to this article, the director shall notify the insurer of receipt of the objection and of the right of the insurer to file a written response within ten days of receipt of the notification.  The director may also order an examination of the objection or complaint, the submission of additional information by the insured or the insurer about the action by the insurer or the objections of the insured, or any other procedure as the director deems appropriate or necessary. The insurer shall pay the cost of the examination pursuant to section 20-159. Within fifteen days of receipt of the written objection by an insured the director shall approve or disapprove the insurer's action and shall notify the insured and insurer in writing of the director's final decision.  The director shall order an insurer that has failed to renew a policy in violation of this article to reinstate the policy retroactive to the effective date of the nonrenewal.  Except as provided in section 41-1092.08, subsection H, either party may institute proceedings for judicial review of the director's final decision pursuant to title 12, chapter 7, article 6.  Notwithstanding any other law, if the director decides in favor of the insured, the director may order that the decision not be stayed pending judicial review.
A.R.S. § 20-161 — Arizona Code / Title 20 / Chapter 1 / Article 2 / Section 161
20-161 Hearings
Status: in_force

20-161. Hearings

A. The director may hold hearings for any purpose deemed by him to be necessary and within the scope of this title and shall hold a hearing if required by any provision of this title. Hearings shall be conducted pursuant to title 41, chapter 6, article 10.

B. In a hearing conducted pursuant to this section, an insurer may be represented by a corporate officer.
A.R.S. § 20-490 — Arizona Code / Title 20 / Chapter 2 / Article 14 / Section 490
20-490 Definitions
Status: in_force

20-490. Definitions

In this article, unless the context otherwise requires:

1. "Holocaust victim" means a person who was killed or injured or who lost real or personal property or financial assets as the result of discriminatory laws, policies or actions directed against a discrete group of which the person was a member, during the period beginning in 1920 through 1945, in Germany, areas occupied by Germany or countries allied with Germany.

2. "Insurance policy" includes a life insurance policy, an annuity, a property insurance policy, a casualty insurance policy, a liability insurance policy and reinsurance on a risk covered under such a policy.

3. "Insurer":

(a) Means an insurance company or other entity engaged in the business of insurance or reinsurance in this state.

(b) Includes a capital stock company, a mutual company or a Lloyd's association and any parent, subsidiary or affiliated company in which at least fifty per cent of the stock is in common ownership with an insurer engaged in the business of insurance in this state.
A.R.S. § 20-1059 — Arizona Code / Title 20 / Chapter 4 / Article 9 / Section 1059
20-1059 Annual report to director
Status: in_force

20-1059. Annual report to director

A. Every health care services organization annually on or before March 31 shall file with the director a report of its financial condition, transactions and affairs as of the preceding December 31 as prescribed in sections 20-223 and 20-234 and shall pay the annual renewal fee prescribed in section 20-167.

B. Unless preempted under federal law or unless federal law imposes greater requirements than this section, this section applies to a provider sponsored health care services organization.

C. A health care services organization that fails to timely file the annual report required under subsection A of this section is subject to the penalties prescribed in section 20-223.
A.R.S. § 20-505 — Arizona Code / Title 20 / Chapter 3 / Article 1 / Section 505
20-505 Liabilities
Status: in_force

20-505. Liabilities

In any determination of the financial condition of an insurer, capital stock and liabilities to be charged against its assets shall include:

1. The amount of its capital stock outstanding, if any.

2. The amount, estimated consistent with the provisions of this title, necessary to pay all of its unpaid losses and claims incurred on or prior to the date of statement, whether reported or unreported, together with the expenses of adjustment or settlement thereof.

3. With reference to life and disability insurance and annuity contracts:

(a) The amount of reserves on life insurance policies and annuity contracts in force, including disability benefits for both active lives and lives with disabilities and accidental death benefits, in or supplementary thereto, and disability insurance, valued according to the tables of mortality, tables of morbidity, rates of interest, and methods adopted pursuant to this title which are applicable thereto.

(b) Any additional reserves which may be required by the director consistent with practice formulated or approved by the national association of insurance commissioners, on account of such insurance.

4. With reference to insurance other than specified in paragraph 3 of this section, and other than title insurance, the amount of reserves equal to the unearned portions of the gross premiums charged on policies in force, computed in accordance with this article.

5. Taxes, expenses and other obligations due or accrued at the date of the statement.
A.R.S. § 20-229 — Arizona Code / Title 20 / Chapter 2 / Article 1 / Section 229
20-229 Insurance producer; identification; exceptions
Status: in_force

20-229. Insurance producer; identification; exceptions

A. An authorized insurer shall not issue a policy covering a subject of insurance resident, located or to be performed in this state unless the policy declaration page or endorsement identifies the name of the producer licensed for that line of authority in this state.

B. Subsection A of this section does not apply to:

1. Reinsurance or life, disability or title insurance.

2. Insurance of the rolling stock, vessels or aircraft of any common carrier in interstate or foreign commerce, or of any vehicle principally garaged and used in another state or covering any liability or other risks incident to the ownership, maintenance or operation thereof.

3. Insurance of property in the course of transportation interstate or in foreign trade, or any liability or risk incident thereto.

4. Insurance of ocean marine risks.

5. Policies issued through salaried insurance producers or issued by insurers not using insurance producers in the general solicitation of business.

6. Bid bonds issued by any surety insurer in connection with any public or private contracts.

7. Policies issued by a vending machine pursuant to section 20-293.

C. A violation of this section shall not invalidate the policy.
A.R.S. § 20-3404 — Arizona Code / Title 20 / Chapter 26 / Article 1 / Section 3404
20-3404 Prior authorization requirement timelines
Status: in_force

20-3404. Prior authorization requirement timelines

A. If a plan offered by a health care services plan contains a prior authorization requirement, all of the following apply:

1. For prior authorization requests concerning urgent health care services, the health care services plan or its utilization review agent shall notify the provider of the prior authorization or adverse determination not later than five days after the receipt of all necessary information to support the prior authorization request.

2. For prior authorization requests concerning health care services that are not urgent health care services, the health care services plan or its utilization review agent shall notify the provider of the prior authorization or adverse determination not later than fourteen days after receipt of all necessary information to support the prior authorization request.

3. On receipt of information from the provider in support of a prior authorization request, the health care services plan or its utilization review agent shall provide a receipt in the same format that the request was made to the provider acknowledging that the information was received, unless the necessary return contact information is not provided.

B. The notification required under subsection A of this section shall state whether the prior authorization request is approved, denied or incomplete.  If the prior authorization request is denied, the health care services plan or its utilization review agent shall state the specific reason for the denial.  For a request that is considered incomplete, the provider shall have the opportunity to submit additional information.  Once the provider submits additional information on incomplete requests, the health care services plan has five days to review and respond to requests for health care services deemed urgent and fourteen days to review and respond to requests for health care services deemed not urgent.

C. A prior authorization request is deemed granted if a health care services plan or its utilization review agent fails to comply with the deadlines and notification requirements of this section.

D. A prior authorization request, once granted or deemed granted, is binding on the health care services plan, may be relied on by the enrollee and provider and may not be rescinded or modified by a health care services plan or its utilization review agent after the provider renders the authorized health care services in good faith and pursuant to the authorization unless there is evidence of fraud or misrepresentation by the provider.

E. On a denial of a prior authorization request, the enrollee and the provider may exercise the review and appeal rights specified in chapter 15, article 2 of this title.
A.R.S. § 20-469.01 — Arizona Code / Title 20 / Chapter 2 / Article 6 / Section 469.01
20-469.01 Third party administrator; glass; violation; classification; definition
Status: in_force

20-469.01. Third party administrator; glass; violation; classification; definition

A. If a third party administrator recommends or provides information about a glass repair facility to a customer, the third party administrator shall inform the person of the person's right prescribed in section 20-469 to choose any glass repair facility for the repair of the loss relating to motor vehicle glass at the same time as making the recommendation or providing information. An independent adjuster or a third party administrator's automotive physical damage appraiser or claims inspector for automotive glass repair or replacement work in connection with an inspection limited to automotive glass repair or replacement shall not recommend any particular glass repair facility.

B. This section shall not apply to any employee or insurance producer of an insurer.

C. This section shall not create a private right of action.

D. A person who knowingly violates this section is guilty of a petty offense for a first violation and, notwithstanding section 13-802, shall pay a fine of one thousand five hundred dollars for a second violation within eighteen months after a prior violation of this section and three thousand dollars for any subsequent violation within eighteen months after a prior violation of this section.

E. For the purposes of determining whether a defendant acted knowingly, it may be presumed that the person had knowledge if the person was engaged in a regular and consistent pattern of the prohibited activity.

F. For the purposes of this section "third party administrator" means any person who provides administrative service or adjusts or settles claims in connection with automobile glass repair insurance coverage.
A.R.S. § 20-236 — Arizona Code / Title 20 / Chapter 2 / Article 1 / Section 236
20-236 Civil penalty for failure to respond to a request for verification of financial responsibility
Status: in_force

20-236. Civil penalty for failure to respond to a request for verification of financial responsibility

If the director finds after a hearing that, upon certification by the department of transportation, an insurer has failed to respond in writing within thirty days to a financial responsibility verification request pursuant to section 28-4143, the director shall impose a civil penalty of not more than two hundred fifty dollars for each violation but not to exceed an aggregate penalty of twenty thousand dollars in any one six-month period.
A.R.S. § 20-2121 — Arizona Code / Title 20 / Chapter 11 / Article 1 / Section 2121
20-2121 Enforcement of privacy provisions of Gramm Leach Bliley act
Status: in_force

20-2121. Enforcement of privacy provisions of Gramm Leach Bliley act

A. The department may enforce title V, subtitle A of the Gramm Leach Bliley act (15 United States Code sections 6801 through 6809) related to privacy and protection of nonpublic personal information.

B. The director may adopt rules pursuant to title 41, chapter 6 to carry out this section.
A.R.S. § 20-722 — Arizona Code / Title 20 / Chapter 4 / Article 1 / Section 722
20-722 Stock dividends
Status: in_force

20-722. Stock dividends

A. A domestic stock insurer shall not pay any cash dividend to stockholders except out of that part of its available surplus funds which is derived from realized net profits on its business.

B. A stock dividend may be paid out of any available surplus funds in excess of the aggregate amount of surplus loaned to the insurer pursuant to section 20-725.

C. A dividend otherwise proper, may be payable out of the insurer's earned surplus even though its total surplus is then less than the aggregate of its past contributed surplus resulting from issuance of its capital stock at a price in excess of the par value thereof.
A.R.S. § 20-1807 — Arizona Code / Title 20 / Chapter 8 / Article 1 / Section 1807
20-1807 Annual report; civil penalty
Status: in_force

20-1807. Annual report; civil penalty

A. Each year not later than ninety days after the last day of the provider's fiscal year, each provider shall file with the department an annual report accompanied by the fee prescribed in section 20-167. The annual report shall include the information required by section 20-1802, subsection B, except that the information required by section 20-1802, subsection B, paragraphs 5, 15 and 17 shall be filed in accordance with the provisions of subsection C of this section. The annual report need not include the information required by section 20-1802, subsection B, paragraph 16. The annual report shall be made on forms provided by the department.  The annual report and any amendment to the annual report shall be signed under oath by the chief executive officer of the provider. For good cause, the director may extend the due date for a provider to file its annual report and pay the required fee.

B. A provider shall amend its annual report on file with the department at any time, without the payment of any additional fee, if an amendment is necessary to prevent the annual report from containing a material misstatement of fact or omitting to state a material fact required to be stated.

C. Any provider, manager or promoter shall comply with the requirements of this section as follows:

1. Information required by section 20-1802, subsection B, paragraph 5 shall be filed:

(a) Immediately on the substitution or installation of a member of the board of directors or an officer, trustee or managing partner different from the information disclosed in the provider's application or submission pursuant to subdivision (b).

(b) Every three years after the initial filing of the biographical affidavit by the provider.

2. Certified financial statements required by section 20-1802, subsection B, paragraph 15 for the two most recent fiscal years shall be filed with the annual report by the provider and manager only. The certified financial statements of the promoter shall be filed with the annual report unless the promoter is not currently employed by the provider.

3. The actuarial study required by section 20-1802, subsection B, paragraph 17 shall be filed by the provider on a triennial basis beginning with the year in which resident occupancy began at the facility or contract holders began receiving services pursuant to the permit issued to the provider. The director may require a provider to file an actuarial study on a more frequent basis if the director deems it necessary and may adjust subsequent triennial filings accordingly.

D. A provider shall not change the fiscal year end date disclosed pursuant to section 20-1802, subsection B, paragraph 4 without the prior approval of the director. The director shall approve the change if the commissioner of the internal revenue service grants a request for a change of a fiscal year pursuant to 26 United States Code section 442.

E. Assets shall be reported at values determined pursuant to sections 20-511 through 20-515.  If the director deems it necessary to value any real estate the director may employ one or more competent appraisers for that purpose, and the reasonable expense shall be borne by the provider.

F. The director may assess and collect a civil penalty of not more than twenty-five dollars for each day the annual report is late against a provider who fails to file the annual report timely accompanied by the required fee.
A.R.S. § 20-1241.08 — Arizona Code / Title 20 / Chapter 6 / Article 1.1 / Section 1241.08
20-1241.08 Violations; penalties; intent
Status: in_force

20-1241.08. Violations; penalties; intent

A. Any person who does not comply with the applicable requirements of this article is subject to penalties prescribed under sections 20-220, 20-295 and 20-456.  Violations include:

1. Any deceptive or misleading information set forth in sales material.

2. When completing an application, failing to ask the applicant the pertinent questions regarding the possibility of financing or replacement.

3. The intentional incorrect recording of an answer.

4. Advising an applicant to respond negatively to any question regarding replacement in order to prevent notice to the existing insurer.

5. Advising a policy or contract owner to write directly to the company in such a way as to attempt to obscure the identity of the replacing insurance producer or company.

B. A policy or contract owner may replace existing life insurance or annuities after indicating in or as part of an application for new coverage that replacement is not intended.  A pattern of such action by a policy or contract owner who buys new coverage from the same producer is deemed prima facie evidence of the insurance producer's knowledge that replacement was intended in connection with the transaction and of the insurance producer's intent to violate this article.

C. If the requirements of this article have not been met, the replacing insurer shall provide the policy owner an in-force illustration, if available, a policy summary for the replacement policy or the available disclosure document for the replacement contract and the appropriate notice regarding replacements prescribed in section 20-1241.03.

D. The director may impose the following penalties for a violation of this article either separately or in combination:

1. Revocation or suspension of an insurance producer's or company's license.

2. Civil monetary penalties.

3. Forfeiture of any commissions or compensation paid to an insurance producer as a result of the transaction in connection with which the violations occurred.

4. If the director has determined that the violations were material to the sale, the insurer may be required to make restitution, restoration of policy or contract values and interest at the maximum lawful rate on the amount refunded in cash.
A.R.S. § 20-1576 — Arizona Code / Title 20 / Chapter 6 / Article 9 / Section 1576
20-1576 Mergers and consolidations of title insurers
Status: in_force

20-1576. Mergers and consolidations of title insurers

A. A title insurer incorporated under the laws of this state may merge, be merged by or consolidated with, one or more title insurers whether or not so incorporated, by complying with the provisions of general law governing the merger or consolidation of stock corporations formed for profit, but subject to the further provisions of this section:

1. No such merger or consolidation shall be effectuated unless in advance thereof, the plan and agreement therefor have been filed with the director. The director shall examine the terms and conditions of such merger or consolidation, and of any exchange of shares or securities pursuant thereto, after holding a hearing at which all persons or parties to whom it is proposed to issue shares or securities in such exchange shall have the right to appear. After such hearing, the director shall either approve or disapprove the fairness of such terms and conditions of exchange. The director shall give such approval within a reasonable time after filing of a plan or agreement unless he finds such plan or agreement:

(a) Is contrary to law; or

(b) Inequitable to the stockholders of such insurer; or

(c) Would substantially reduce the security of and services to be rendered to policyholders of the domestic title insurer in this state or elsewhere.

2. Where such merger or consolidation involves a parent company absorbing a wholly-owned subsidiary, the director may, in his discretion, dispense with the holding of a hearing.

B. No director, officer, agent or employee of any title insurer party to such acquisition shall receive any fee, commission, compensation or other valuable consideration whatsoever for in any manner aiding, promoting or assisting therein except as set forth in such plan or agreement.

C. If the director does not approve any such plan or agreement, he shall notify the title insurer in writing specifying in detail his reasons therefor.
A.R.S. § 20-225 — Arizona Code / Title 20 / Chapter 2 / Article 1 / Section 225
20-225 Failure to pay tax; penalty; exception
Status: in_force

20-225. Failure to pay tax; penalty; exception

A. Any insurer failing to pay the tax prescribed by sections 20-224, 20-224.01, 20-837, 20-1010, 20-1060 and 20-1097.07 is subject to a civil penalty not to exceed the greater of twenty-five dollars or five percent of the amount due plus interest at the rate of one percent per month from the date the tax was due.

B. The director may refuse to renew the certificate of authority of any insurer failing to pay the tax on or before the date it is due. The director shall revoke the certificate of authority of any insurer failing to pay the tax for more than thirty days after it was due.

C. If the director requires the tax to be paid electronically through a designated third-party service pursuant to section 20-224, subsection K, no penalty accrues with respect to any payment of tax or interest that is late due to delays caused by the third-party service.
A.R.S. § 20-1741 — Arizona Code / Title 20 / Chapter 7 / Article 4 / Section 1741
20-1741 Annual statement to include certain claims and premium information
Status: in_force

20-1741. Annual statement to include certain claims and premium information

Each licensed insurer that is authorized to transact casualty insurance in this state and that writes professional liability insurance, as part of the annual statement required by section 20-223, shall report professional liability claims and premium data as prescribed by the director.
A.R.S. § 20-340.03 — Arizona Code / Title 20 / Chapter 2 / Article 3.5 / Section 340.03
20-340.03 Bail bond agent prohibitions
Status: in_force

20-340.03. Bail bond agent prohibitions

A. A bail bond agent shall not:

1. Suggest or advise the employment of or name for employment any particular attorney to represent the agent's principal.

2. Solicit business in or around any place where prisoners are confined or in or around any court.

3. Receive or collect for an attorney any monies or other items of value for any attorney fee, cost or other purpose on behalf of an arrestee, unless a receipt is given.

4. For any purpose, directly or indirectly, enter into an arrangement of any kind or have an understanding with any person to inform or notify any bail bond agent directly or indirectly of any of the following:

(a) The existence of a criminal complaint.

(b) The fact of an arrest.

(c) The fact that an arrest of any person is pending or contemplated.

(d) Any information pertaining to matters described in this paragraph or to the persons involved.

5. Participate in the capacity of an attorney at a trial or hearing of a person on whose bond the bail bond agent is the surety.

6. Accept anything of value from a principal except the premium and expenses.  The bail bond agent may accept collateral security or other indemnity from the principal or on behalf of the principal that the bail bond agent shall return on final termination of liability on the bond unless the collateral has been forfeited because the defendant did not appear in court. The collateral security or other indemnity required by the bail bond agent must be reasonable in relation to the amount of the bond.

7. Give, authorize, sign or countersign in blank any power of attorney to bonds unless the authorized person is a licensed bail bond agent directly employed by the bail bond agent giving the power of attorney.

8. Advertise as or claim to be a surety company.

9. Employ or assist in the employment of any person who has been convicted in any jurisdiction of theft or of any felony or of any crime involving carrying or the possession of a deadly weapon or dangerous instrument.  This paragraph does not apply to a person whose felony conviction has been set aside or whose civil rights have been restored because of a felony conviction, except for a conviction of theft or of any crime involving carrying or the possession of a deadly weapon or dangerous instrument.

B. For the purposes of subsection A, paragraph 9, "employment" means working for a salary, a commission or under contract or owning, operating or controlling any business or agency that solicits, services or assists in any way in dealing in bail bonds.

C. Law enforcement, adjudication and prosecution officials and the officials' employees, attorneys-at-law, officials authorized to admit to bail and state and county officers shall not be bail bond agents and shall not directly or indirectly receive any benefits from the execution of any bail bond. This section does not prohibit a bail bond agent from hiring counsel or asking assistance of a law enforcement officer.

D. In any bail transaction or in connection with any bail transaction, a bail bond agent shall not directly or indirectly charge or collect monies or other valuable consideration from any person except for the following purposes:

1. To pay the premium at the rates that are established by the surety insurer and that are approved by the director.

2. To provide collateral.

3. To be reimbursed for actual and reasonable expenses incurred in connection with the individual bail transaction.
A.R.S. § 20-1663 — Arizona Code / Title 20 / Chapter 6 / Article 13 / Section 1663
20-1663 Unreasonable mass marketed insurance prohibited; hearing; findings; rules
Status: in_force

20-1663. Unreasonable mass marketed insurance prohibited; hearing; findings; rules

A. No mass marketed life or health insurance may continue to be transacted in this state if the director finds that the total charges for the insurance to the persons who are insured are unreasonable in relation to the benefits provided. The director shall make any such finding after conducting a hearing on not less than thirty days' written notice to the insurer. The director shall make such findings in writing, including the reasons for such findings, and may issue an order directing the insurer to cease transacting such insurance. Such an order continues in effect until the director determines that the total charges for the insurance are found to be reasonable in relation to the benefits.

B. The director may adopt reasonable rules to determine whether the total charges for the insurance to persons insured are unreasonable in relation to the benefits provided.

C. Nothing in this section shall be construed to permit the director to set rates.
A.R.S. § 20-1615 — Arizona Code / Title 20 / Chapter 6 / Article 10 / Section 1615
20-1615 Rules
Status: in_force

20-1615. Rules

In the manner prescribed by section 20-143, the director may make reasonable rules as the director deems appropriate for proper administration of this article.
A.R.S. § 20-481.19 — Arizona Code / Title 20 / Chapter 2 / Article 8 / Section 481.19
20-481.19 Extraordinary dividend or distribution; time; notice; approval by director; definition
Status: in_force

20-481.19. Extraordinary dividend or distribution; time; notice; approval by director; definition

A. No insurer subject to registration under section 20-481.09 shall pay an extraordinary dividend or make any other extraordinary distribution to its shareholders until thirty days after the director has received notice of the declaration thereof and has not within such period disapproved such payment, or the director shall have approved such payment. Notice of the declaration shall be provided to the director no more than five business days after the declaration.

B. Notwithstanding any other law, an insurer may declare an extraordinary dividend or distribution that is conditional on the approval of the director, and such a declaration shall confer no rights on shareholders until the director has either approved the payment of such dividend or distribution or has not disapproved such payment within thirty days after the notice of such declaration has been received.

C. For the purposes of this section, "extraordinary dividend or distribution" includes any dividend or distribution of cash or other property whose fair market value together with that of other dividends or distributions made within the preceding twelve months exceeds the lesser of either ten per cent of such insurer's surplus as regards policyholders as of December 31 next preceding, or the net gain from operations of such insurer, if such insurer is a life insurer, or the net income, if such insurer is not a life insurer, for the twelve month period ending December 31 next preceding, but shall not include pro rata distributions of any class of the insurer's own securities.
A.R.S. § 20-1070 — Arizona Code / Title 20 / Chapter 4 / Article 9 / Section 1070
20-1070 Acquisitions and mergers
Status: in_force

20-1070. Acquisitions and mergers

A. No health care services organization may merge with another foreign or domestic health care services organization or may be acquired by a person except on approval by the director and by complying with the provisions of general law governing the merger or consolidation of stock corporations and the other provisions of this section.

B. If the health care services organization is being acquired and if more than twenty-five per cent of the stock or ownership or control is being acquired, the acquiring person shall file the statement described by section 20-481.03 with the director at least thirty days before the effective date of the acquisition.

C. In the case of a merger the plan of merger shall be filed with the director at least sixty days before the effective date of the merger.

D. The director shall approve the acquisition or merger if the acquiring or merging persons have met the requirements for a certificate of authority. The director shall make the decision either to approve or disapprove the acquisition or merger within thirty days of the filing of the acquisition statement pursuant to subsection B of this section or the plan of merger pursuant to subsection C of this section.

E. Unless preempted under federal law or unless federal law imposes greater requirements than this section, this section applies to a provider sponsored health care services organization.
A.R.S. § 20-1096.03 — Arizona Code / Title 20 / Chapter 4 / Article 12 / Section 1096.03
20-1096.03 Surplus
Status: in_force

20-1096.03. Surplus

A mechanical reimbursement reinsurer is required to have upon organization initial surplus in an amount not less than one-half of its minimum required capital stock and shall thereafter maintain one-half of the initial surplus.
A.R.S. § 20-2207 — Arizona Code / Title 20 / Chapter 12 / Article 1 / Section 2207
20-2207 Amendments to the plan of operation
Status: in_force

20-2207. Amendments to the plan of operation

Amendments to the plan of operation may be made by the directors of the association, subject to the approval of the director, or shall be made at the direction of the director consistent with the provisions of section 20-2206.
A.R.S. § 20-1027 — Arizona Code / Title 20 / Chapter 4 / Article 8 / Section 1027
20-1027 Liability of underwriters; limitation
Status: in_force

20-1027. Liability of underwriters; limitation

An underwriter in a Lloyd's association may limit his total liability on all risks to the amount of his subscription as expressed in his power of attorney and agreement with the attorney-in-fact, provided that at least half of the subscription of each underwriter shall be paid or contributed to the guaranty fund in cash or securities constituting admitted assets. Each underwriter shall be responsible solely for his own liability as fixed in the contract of insurance and shall not be liable as a partner, and in no event shall the liability of an underwriter exceed the amount of his total underwriters agreement executed in favor of his attorney or attorneys-in-fact.
A.R.S. § 20-115 — Arizona Code / Title 20 / Chapter 1 / Article 1 / Section 115
20-115 Department jurisdiction over certain health care providers; exception; examination; disclosure
Status: in_force

20-115. Department jurisdiction over certain health care providers; exception; examination; disclosure

A. Any person or other entity, including a provider sponsored organization that operates under the Medicare-plus-choice program established under the balanced budget act of 1997 (42 United States Code sections 1395w-21 through 1395w-28 and title XVIII, part C of the social security act, sections 1851 through 1859), that provides coverage in this state for medical, surgical, chiropractic, naturopathic medicine, occupational therapy, physical therapy, speech pathology, audiology, professional mental health, dental, hospital or optometric expenses, whether the coverage is by direct payment, reimbursement or otherwise, is presumed to be subject to the jurisdiction of the department unless the person or other entity shows that while providing coverage it is subject to the jurisdiction of another agency of this state, any political subdivision of this or any other state or the federal government.

B. A person or entity that provides coverage for services identified in subsection A may show that it is subject to the jurisdiction of another agency of this state, any political subdivision of this or any other state or the federal government by providing to the director the appropriate certificate, license or other document that is issued by the other governmental agency and that permits or qualifies it to provide those services.

C. Any person or entity that provides coverage in this state for services described in subsection A and is unable to show it is subject to the jurisdiction of another agency of this state, any political subdivision of this or any other state or the federal government:

1. Shall submit to an examination by the director to determine the organization and solvency of the person or the entity and to determine whether or not the person or entity is in compliance with the applicable provisions of this title.

2. Is subject to all appropriate provisions of this title regarding the conduct of its business.

D. Any production agency or administrator which advertises, sells, transacts or administers coverage in this state for services described in subsection A which is provided by any person or entity described in subsection C, if that coverage is not fully insured or otherwise fully covered by an admitted life or disability insurer, nonprofit hospital service plan or nonprofit health care plan, shall advise any purchaser, prospective purchaser or covered person of the lack of insurance or other coverage.

E. Any administrator which advertises or administers coverage in this state for services described in subsection A which is provided by any person or entity described in subsection C shall advise any production agency of the elements of the coverage including the amount of stop-loss insurance in effect.

F. This section does not apply to or prohibit a self-insured program operated by a single employer for the benefit of its employees or the employees of a wholly-owned subsidiary.
A.R.S. § 20-108.01 — Arizona Code / Title 20 / Chapter 1 / Article 1 / Section 108.01
20-108.01 Extended warranty insurers; deposit with state treasurer; powers and duties; definition
Status: in_force

20-108.01. Extended warranty insurers; deposit with state treasurer; powers and duties; definition

A. Every extended warranty insurer shall deposit with the state treasurer and maintain on deposit for the benefit and protection of any person purchasing such extended warranty or guaranty in the event of insolvency of the extended warranty insurer under its contract with any such person either of the following:

1. A bond in the amount of $25,000 issued by an insurance company holding a current certificate of authority issued by the director.

2. Eligible securities as defined in section 20-583 having the lesser of par or market value of not less than $25,000.

B. The director may adopt rules and regulations to enforce this section.

C. For the purposes of this section, "extended warranty insurer" has the same meaning prescribed in section 20-108.
A.R.S. § 20-2402 — Arizona Code / Title 20 / Chapter 14 / Article 1 / Section 2402
20-2402 Risk retention groups chartered and licensed in this state; definitions
Status: in_force

20-2402. Risk retention groups chartered and licensed in this state; definitions

A. A risk retention group, pursuant to this title, shall be chartered and licensed to write only liability insurance pursuant to this chapter and, except as provided in this chapter, must comply with this title with respect to insurers that are chartered and licensed in this state and with section 20-2403. Before it may offer insurance in any state, each risk retention group shall also submit for approval to the director of the department of insurance and financial institutions a plan of operation or a feasibility study and revisions of the plan or study if the group intends to offer any additional lines of liability insurance.  The group shall not offer any additional kinds of liability insurance in this state or in any other state until a revision of the plan or study is approved by the director of the department of insurance and financial institutions.

B. Immediately on receipt of an application for a charter, this state shall provide summary information concerning the filing to the national association of insurance commissioners, including the name of the risk retention group, the identity of the initial members of the group, the identity of those individuals who organized the group or who will provide administrative services or otherwise influence or control the activities of the group, the amount and nature of initial capitalization, the coverages to be afforded and the states in which the group intends to operate.

C. A risk retention group that is licensed in this state shall comply with all of the following:

1. The board of directors of the risk retention group shall have a majority of independent board directors.  If the risk retention group is a reciprocal risk retention group, the attorney-in-fact shall be required to adhere to the same standards regarding independence of operation and governance as imposed on the risk retention group's board of directors or subscribers' advisory committee, or both, under these standards, and, to the extent permissible under this state's laws, service providers of a reciprocal risk retention group shall contract with the risk retention group and not the attorney-in-fact.

2. A board director does not qualify as independent unless the board of directors affirmatively determines that the board director has no material relationship with the risk retention group. Each risk retention group shall disclose these determinations to its domestic regulator at least annually. Any person that is a direct or indirect owner of or subscriber in the risk retention group or is an officer, board director or employee, or all three, of an owner and insured, as contemplated by 15 United States Code section 3901(a)(4)(E)(ii), is considered to be independent, unless some other position of that officer, board director or employee constitutes a material relationship.

3. The term of any material service provider contract with the risk retention group may not exceed five years.  Any contract or its renewal shall require the approval of the majority of the risk retention group's independent board directors. The risk retention group's board of directors shall have the right to terminate any service provider, audit or actuarial contracts at any time for cause after providing adequate notice as defined in the contract. The service provider contract is deemed material if the amount to be paid for that contract is greater than or equal to five percent of the risk retention group's annual gross written premium or two percent of its surplus, whichever is greater. A service provider contract that is a material relationship may not be entered into unless the risk retention group has notified the director of the department of insurance and financial institutions in writing of its intention to enter into the transaction at least thirty days before and the director of the department of insurance and financial institutions has not disapproved the transaction within that period.

4. The board of directors of a risk retention group shall adopt a written policy in the plan of operation as approved by the board that requires the board of directors to do all of the following:

(a) Ensure that all owners or insureds, or both, of the risk retention group receive evidence of ownership interest.

(b) Develop a set of governance standards applicable to the risk retention group.

(c) Oversee the evaluation of the risk retention group's management, including the performance of the captive manager, managing general underwriter or other parties responsible for underwriting, determination of rates, collection of premium, adjusting or settling claims or the preparation of financial statements.

(d) Review and approve the amount to be paid for all material service providers.

(e) Review and approve, at least annually, all of the following:

(i) The risk retention group's goals and objectives relevant to the compensation of officers and service providers.

(ii) The officers' and service providers' performance in light of those goals and objectives.

(iii) The continued engagement of the officers and material service providers.

5. Each risk retention group shall have an audit committee composed of at least three independent board members.  A nonindependent board member may participate in the activities of the audit committee, if invited by the members, but cannot be a member of that committee.  The audit committee shall have a written charter that defines the committee's purpose, which, at a minimum, shall be to do all of the following:

(a) Assist in board oversight of the integrity of the financial statements, the compliance with legal and regulatory requirements and the qualifications, independence and performance of the independent auditor and actuary.

(b) Discuss the annual audited financial statements and quarterly financial statements with management.

(c) Discuss the annual audited financial statements with its independent auditor and, if advisable, discuss its quarterly financial statements with its independent auditor.

(d) Discuss policies with respect to risk assessment and risk management.

(e) Meet separately and periodically, either directly or through a designated representative of the committee, with management and independent auditors.

(f) Review with the independent auditor any audit problems or difficulties and management's response.

(g) Set clear hiring policies of the risk retention group as to the hiring of employees or former employees of the independent auditor.

(h) Require the external auditor to rotate the lead or coordinating audit partner having primary responsibility for the risk retention group's audit as well as the audit partner responsible for reviewing that audit, so that neither individual performs audit services for more than five consecutive fiscal years.

(i) Report regularly to the board of directors.

6. The director of the department of insurance and financial institutions may waive the requirement to establish an audit committee pursuant to paragraph 5 of this subsection if the risk retention group demonstrates to the director that doing so is impracticable and the risk retention group's board of directors is otherwise able to fulfill the requirements of the audit committee as set forth in this section.

7. The board of directors shall adopt and disclose governance standards by making the information available through electronic means, such as posting the information on the risk retention group's website, or other means, and providing that information to members and insureds on request.  The information shall include all of the following:

(a) A process by which the board directors are elected by the owners or insureds, or both.

(b) Board director qualification standards.

(c) Board director responsibilities.

(d) Board director access to management and, as necessary and appropriate, independent advisers.

(e) Board director compensation.

(f) Board director orientation and continuing education.

(g) The policies and procedures that are followed for management succession.

(h) The policies and procedures that are followed for the annual performance evaluation of the board.

8. The board of directors shall adopt and disclose a code of business conduct and ethics for board directors, officers and employees and promptly disclose to the board of directors any waivers of the code for board directors or executive officers, including all of the following topics:

(a) Conflicts of interest.

(b) Matters covered under the corporate opportunity doctrine under the state of domicile.

(c) Confidentiality.

(d) Fair dealing.

(e) Protection and proper use of risk retention group assets.

(f) Compliance with all applicable laws, rules and regulations.

(g) Requiring the reporting of any illegal or unethical behavior that affects the operation of the risk retention group.

9. The captive manager, president or chief executive officer of the risk retention group shall promptly notify the domestic regulator, in writing, if either becomes aware of any material noncompliance with any of the risk retention group's governance standards.

D. For the purposes of this section:

1. "Board director" means a natural person designated in the articles of the risk retention group, or designated, elected or appointed by any other manner, name or title to act as a board director.

2. "Board of directors" or "board" means the governing body of the risk retention group elected by the shareholders or members to establish policy, elect or appoint officers and committees and make other governing decisions.

3. "Material relationship" means a person's relationship with the risk retention group, including any of the following:

(a) The receipt in any one twelve-month period of compensation or payment of any other item of value by that person, a member of that person's immediate family or any business with which that person is affiliated from the risk retention group or a consultant or service provider to the risk retention group that is greater than or equal to five percent of the risk retention group's gross written premium for that twelve-month period or two percent of its surplus, whichever is greater, as measured at the end of any fiscal quarter falling in a twelve-month period.  The person or immediate family member of that person is not independent until one year after the person's compensation from the risk retention group falls below the threshold.

(b) A relationship with an auditor in which a board director or an immediate family member of a board director who is affiliated with, or employed in, a professional capacity by a present or former internal or external auditor of the risk retention group is not independent until one year after the end of the affiliation, employment or auditing relationship.

(c) A relationship with a related entity in which a board director or immediate family member of a board director who is employed as an executive officer of another company where any of the risk retention group's present executives serve on that other company's board of directors is not independent until one year after the end of that service or the employment relationship.

4. "Service providers" includes captive managers, auditors, accountants, actuaries, investment advisers, attorneys and managing general underwriters or any other party responsible for underwriting, determination of rates, collection of premium, adjusting and settling claims or the preparation of financial statements.  For the purposes of this paragraph, attorney does not include defense counsel retained by the risk retention group to defend claims, unless the amount of fees paid to those attorneys creates a material relationship.
A.R.S. § 20-1402.05 — Arizona Code / Title 20 / Chapter 6 / Article 5 / Section 1402.05
20-1402.05 Contracts; optometrists; covered services; definition
Status: in_force

20-1402.05. Contracts; optometrists; covered services; definition

A. Except as provided in subsection C of this section, a contract, entered into or renewed on or after January 1, 2022, between a group disability insurer and an optometrist who is licensed to practice in this state shall not:

1. Require the optometrist to provide a service to an individual covered under a group disability insurance policy based on a fee set by the group disability insurer unless the service for which the fee applies is a covered service under the individual's group disability insurance policy.

2. Prohibit an optometrist from offering or providing a vision service that is not a covered service to a covered individual at a fee determined by the optometrist or by the optometrist and the covered individual.

3. Require an optometrist to use one or more specific vendors to replenish the optometrist's inventory of spectacle lenses after the optometrist dispenses the optometrist's inventory to eligible members of the vision plan as a covered vision service.

B. This section applies to an administrator providing third-party administration services or a provider network for a vision plan.

C. This section does not prohibit the ability of a group disability insurer to enter into a contract for an optometrist to participate in a discount program sponsored by the group disability insurer for services that are not covered if:

1. Participation in the group disability insurer network is not contingent on participation in the sponsored discount program.

2. The group disability insurer offers equal treatment to an optometrist who does not participate in a group disability insurer sponsored discount program, regarding:

(a) Promotional treatment.

(b) Marketing benefits.

(c) Materials.

(d) Contract terms for providing a covered service.

D. Notwithstanding subsection C, paragraph 2, subdivision (d) of this section, a group disability insurer, when providing a typically formatted list of optometrists in the group disability insurer network, may identify whether an optometrist participates in a discount program for services not covered by the group disability insurer provided that all lists state that other discounts may be available with individual optometrists.

E. All contracts shall be in compliance with this section by the first renewal period on or after January 1, 2022, but not later than December 31, 2022.

F. For the purposes of this section, "covered service" means a service for which any reimbursement is available under a group disability insurance policy without regard to contractual limitations by a deductible, copayment, coinsurance, waiting period, annual or lifetime maximum, frequency limitation, alternative benefit payment, exclusion or other limitation.
A.R.S. § 20-1101 — Arizona Code / Title 20 / Chapter 5 / Article 1 / Section 1101
20-1101 Scope of article
Status: in_force

20-1101. Scope of article

This article shall not apply to:

1. Reinsurance.

2. Policies or contracts not issued for delivery in this state nor delivered in this state, except as provided in section 20-1110, subsection G (approval of forms for delivery in jurisdictions where local approval not provided for) and in section 20-1133, subsection A (medicare supplement insurance minimum standards).

3. Ocean marine and foreign trade insurances.

4. Title insurance, except as to section 20-1115.
A.R.S. § 20-1369 — Arizona Code / Title 20 / Chapter 6 / Article 4 / Section 1369
20-1369 Arrangement of provisions in policy
Status: in_force

20-1369. Arrangement of provisions in policy

The provisions which are the subject of sections 20-1345 to 20-1368, inclusive, or any corresponding provisions which are used in lieu thereof in accordance with such sections, shall be printed in the consecutive order of the provisions in such sections or, at the option of the insurer, any such provision may appear as a unit in any part of the policy, with other provisions to which it may be logically related, provided that the resulting policy shall not be in whole or in part unintelligible, uncertain, ambiguous, abstruse or likely to mislead a person to whom the policy is offered, delivered or issued.
A.R.S. § 20-1360 — Arizona Code / Title 20 / Chapter 6 / Article 4 / Section 1360
20-1360 Other insurance in this insurer
Status: in_force

20-1360. Other insurance in this insurer

A. There may be a provision as follows:

"Other insurance in this insurer: If an accident or sickness or accident and sickness policy or policies previously issued by the insurer to the insured be in force concurrently herewith, making the aggregate indemnity for _____________________ (insert type of coverage or coverages) in excess of $ _______________________ (insert maximum limit of indemnity or indemnities) the excess insurance shall be void and all premiums paid for such excess shall be returned to the insured or to his estate."

B. The following provision may be inserted in lieu of the provision set forth in subsection A of this section: "Insurance effective at any one time on the insured under a like policy or policies in this insurer is limited to the one such policy elected by the insured, his beneficiary or his estate, as the case may be, and the insurer will return all premiums paid for all other such policies."
A.R.S. § 20-2119 — Arizona Code / Title 20 / Chapter 11 / Article 1 / Section 2119
20-2119 Immunity
Status: in_force

20-2119. Immunity

No claim for relief in the nature of defamation, invasion of privacy or negligency may arise against any person for disclosing personal or privileged information according to this chapter nor may such a claim for relief arise against any person for furnishing personal or privileged information according to this chapter to an insurance institution, insurance producer or insurance support organization, except that this section provides no immunity for disclosing or furnishing false information with malice or wilful intent to injure any person.
A.R.S. § 20-710 — Arizona Code / Title 20 / Chapter 4 / Article 1 / Section 710
20-710 Formation of mutuals; trust deposit of premiums; issuance of policies
Status: in_force

20-710. Formation of mutuals; trust deposit of premiums; issuance of policies

A. All sums collected by a domestic mutual corporation as premiums and fees on qualifying applications for insurance therein shall be deposited in trust in a bank or trust company of this state under a written trust agreement consistent with this section and with paragraph 3 of subsection C of section 20-709. The corporation shall file an executed copy of the trust agreement with the director.

B. Upon issuance to the corporation of a certificate of authority as an insurer for the kind of insurance for which the applications were solicited, all funds so held in trust shall become the funds of the insurer, and the insurer shall forthwith issue and deliver its policies for which premiums had been paid and accepted. The insurance provided by such policies shall be effective as of the date of the certificate of authority.
A.R.S. § 20-2103 — Arizona Code / Title 20 / Chapter 11 / Article 1 / Section 2103
20-2103 Pretext interviews; exception
Status: in_force

20-2103. Pretext interviews; exception

An insurance institution, insurance producer or insurance support organization shall not use or authorize the use of pretext interviews to obtain information in connection with an insurance transaction, except that a pretext interview may be undertaken to obtain information from a person or institution that does not have a generally or statutorily recognized privileged relationship with the person about whom the information relates for the purpose of investigating a claim where, based upon specific information available for review by the director, there is a reasonable basis for suspecting criminal activity, fraud, material misrepresentation or material nondisclosure in connection with the claim.
A.R.S. § 20-1095.03 — Arizona Code / Title 20 / Chapter 4 / Article 11 / Section 1095.03
20-1095.03 Qualifications for permit
Status: in_force

20-1095.03. Qualifications for permit

A. The director shall not issue a permit to a service company unless all of the following conditions are met:

1. The applicant is solvent and organized under the laws of this state or another state, district, territory or possession of the United States.

2. The applicant furnishes proof as necessary to the director that the directors and management of the service company are competent and are capable of successfully managing the service company's affairs in compliance with law.

3. The applicant either:

(a) Files a surety bond or an alternative to a surety bond as required by section 20-1095.04.

(b) Is insured by a mechanical reimbursement insurance policy issued by an insurer authorized to do business in this state and provides a copy of the policy to the director.

4. The applicant is in compliance and continues to be in compliance with all applicable laws.

5. The applicant pays the initial fee prescribed in section 20-167.

B. This article does not require the director to determine the actual financial condition or claims practices of any service company.  The issuance of a service company permit indicates only that the entity appears to be financially sound and to have satisfactory claims practices and that the director has no credible evidence to the contrary.
A.R.S. § 20-1221 — Arizona Code / Title 20 / Chapter 6 / Article 1 / Section 1221
20-1221 Application and contract as entire contract in annuities
Status: in_force

20-1221. Application and contract as entire contract in annuities

In an annuity or pure endowment contract, other than a reversionary, survivorship or group annuity, there shall be a provision that the contract shall constitute the entire contract between the parties or, if a copy of the application is endorsed upon or attached to the contract when issued, a provision that the contract and the application therefor shall constitute the entire contract between the parties.
A.R.S. § 20-481.01 — Arizona Code / Title 20 / Chapter 2 / Article 8 / Section 481.01
20-481.01 Investment limitations; exemptions
Status: in_force

20-481.01. Investment limitations; exemptions

A. Any domestic insurer, either by itself or in cooperation with one or more persons, may organize or acquire one or more subsidiaries subject to the limitations of this article. Such subsidiaries may conduct any kind of business or businesses and the authority to do so shall not be limited by reason of the fact that such subsidiaries are subsidiaries of a domestic insurer.

B. In addition to investments in common stock, preferred stock, debt obligations and other securities permitted under all other sections of this title, a domestic insurer, pursuant to subsection A of this section, may:

1. Invest in common stock, preferred stock, debt obligations and other securities of one or more subsidiaries in amounts that do not exceed the lesser of ten per cent of such insurer's assets or fifty per cent of such insurer's surplus as regards policyholders, provided that after such investments the insurer's surplus as regards policyholders will be reasonable in relation to the insurer's outstanding liabilities and adequate to its financial needs. In calculating the amount of such investments, investments in domestic or foreign insurance subsidiaries and health care service organizations shall be excluded, and there shall be included total net monies or other consideration expended and obligations assumed in the acquisition or formation of a subsidiary including all organizational expenses and contributions to capital and surplus of such subsidiary whether or not represented by the purchase of capital stock or issuance of other securities, and all amounts expended in acquiring additional common stock, preferred stock, debt obligations, and other securities and all contributions to the capital or surplus, of a subsidiary subsequent to its acquisition or formation.

2. Invest any amount in common stock, preferred stock, debt obligations and other securities of one or more subsidiaries that is engaged or organized to engage exclusively in the ownership and management of assets authorized as investments for the insurer if each subsidiary agrees to limit its investments in any asset so that such investments will not cause the amount of the total investment of the insurer to exceed any of the investment limitations specified in paragraph 1 of this subsection or in chapter 3, article 2 of this title, applicable to the insurer. For the purpose of this paragraph, "the total investment of the insurer" includes any direct investment by the insurer in an asset and the insurer's proportionate share of the investment in an asset by any subsidiary of the insurer, which shall be calculated by multiplying the amount of the subsidiary's investment by the percentage of the insurer's ownership of such subsidiary.

3. With the approval of the director, invest any greater amount in common stock, preferred stock, debt obligations or other securities of one or more subsidiaries, provided that after such investment the insurer's surplus as regards policyholders will be reasonable in relation to the insurer's outstanding liabilities and adequate to its financial needs.

C. Investments in common stock, preferred stock, debt obligations or other securities of subsidiaries made pursuant to subsection B of this section are not subject to any of the otherwise applicable restrictions or prohibitions contained in this title applicable to such investment of insurers.

D. Whether any investment pursuant to subsection B of this section meets the applicable requirements is to be determined before the investment is made by calculating the applicable investment limitations as if the investment had already been made, taking into account the then outstanding principal balance on all previous investments in debt obligations, and the value of all previous investments in equity securities as of the date they were made, net of any return of capital invested, not including dividends.

E. If an insurer ceases to control a subsidiary, it shall dispose of any investment in the subsidiary made pursuant to this section within three years from the time of the cessation of control or within such further times as the director may prescribe, unless at any time after such investment has been made, such investment has met the requirements for investment under any other section of this title, and the insurer has so notified the director.

F. For the purposes of this section, in determining whether an insurer's surplus as regards policyholders is reasonable in relation to the insurer's outstanding liabilities and adequate to its financial needs, the following factors shall be considered:

1. The quality and liquidity of investments in affiliates. The director may treat any investment as a disallowed asset for purposes of determining the adequacy of surplus as regards policyholders if in the judgment of the director the investment warrants it.

2. The size of the insurer as measured by its assets, capital and surplus, reserves, premium writings, insurance in force and other appropriate criteria.

3. The extent to which the insurer's business is diversified among the several lines of insurance.

4. The number and size of risks insured in each line of business.

5. The extent of the geographical dispersion of the insurer's insured risks.

6. The nature and extent of the insurer's reinsurance program.

7. The quality, diversification and liquidity of the insurer's investment portfolio.

8. The recent past and projected future trend in the size of the insurer's surplus as regards policyholders.

9. The surplus as regards policyholders maintained by other comparable insurers.

10. The adequacy of the insurer's reserves.
A.R.S. § 20-1058 — Arizona Code / Title 20 / Chapter 4 / Article 9 / Section 1058
20-1058 Examination of health care services organizations
Status: in_force

20-1058. Examination of health care services organizations

A. The director may once in each six months for the first three years after organization and once each year thereafter, or more often if deemed necessary by the director, visit each health care services organization organized under the laws of this state to examine its financial condition, its ability to meet its liabilities and its compliance with the laws of this state affecting the conduct of its business. The director may annually similarly visit and examine, either alone or jointly with representatives of the insurance supervising departments of other states, each health care services organization not organized under the laws of this state but authorized to transact business in this state.

B. The director may in like manner examine each health care services organization applying for an initial certificate of authority to do business in this state.

C. In lieu of making an examination, the director may accept a full report of the last recent examination of a foreign or alien health care services organization, certified to by the insurance supervisory official of another state, territory, commonwealth or district of the United States.

D. The director of the department of health services may participate in the examinations and visits described in this section and section 20-1064 to review the delivery of health and medical services by the health care services organization.

E. All examinations and examination related expenses shall be borne by the health care services organization and shall be paid by the insurance examiners' revolving fund in accordance with sections 20-156 and 20-159.

F. Unless preempted under federal law or unless federal law imposes greater requirements than this section, this section applies to a provider sponsored health care services organization.
A.R.S. § 20-2501 — Arizona Code / Title 20 / Chapter 15 / Article 1 / Section 2501
20-2501 Definitions; scope
Status: in_force

20-2501. Definitions; scope

A. In this chapter, unless the context otherwise requires:

1. "Adverse determination":

(a) Means a utilization review determination by the utilization review agent that a requested service or claim for service or a denial, reduction or termination of a service, in whole or in part, is not a covered service, or is not medically necessary or appropriate, including health care setting, level of care or effectiveness of a covered benefit, or is experimental or investigational under the plan if that determination results in a documented denial or nonpayment of the service or claim.

(b) Includes a rescission.

2. "Benefits based on the health status of the insured" means a contract of insurance to pay a fixed benefit amount, without regard to the specific services received, to a policyholder who meets certain eligibility criteria based on health status including:

(a) A disability income insurance policy that pays a fixed daily, weekly or monthly benefit amount to an insured who is deemed to have a disability as defined by the policy terms.

(b) A hospital indemnity policy that pays a fixed daily benefit during hospital confinement.

(c) A disability insurance policy that pays a fixed daily, weekly or monthly benefit amount to an insured who is certified by a licensed health care professional as chronically ill as defined by the policy terms.

(d) A disability insurance policy that pays a fixed daily, weekly or monthly benefit amount to an insured who suffers from a prolonged physical illness, disability or cognitive disorder as defined by the policy terms.

3. "Claim":

(a) Means a request for payment for a service already provided.

(b) Does not include:

(i) Claim adjustments for usual and customary charges for a service or coordination of benefits between health care insurers.

(ii) A request for payment under a policy or contract that pays benefits based on the health status of the insured and that does not reimburse the cost of or provide covered services.

4. "Covered service" means a service that is included in a policy, evidence of coverage or similar document that specifies which services, insurance or other benefits are included or covered.

5. "Denial":

(a) Means a direct or indirect determination regarding all or part of a request for any service.

(b) Includes a denial, reduction or termination of a service or a rescission or a direct determination regarding a claim that may trigger a request for review.

(c) Does not include:

(i) Enforcement of a health care insurer's deductibles, copayments or coinsurance requirements or adjustments for usual and customary charges, deductibles, copayments or coinsurance requirements for a service or coordination of benefits between health care insurers.

(ii) The rejection of a request for payment under a policy or contract that pays benefits based on the health status of the insured and that does not reimburse the cost of or provide covered services.

6. "Final internal adverse determination" means an adverse determination that is upheld, in whole or in part, at the completion of the health care insurer's internal levels of review or an adverse determination with respect to which the internal levels of review have been waived or deemed exhausted.

7. "Grandfathered individual plan" means coverage provided by an individual health care insurer which was purchased before March 23, 2010 and which has not lost such status due to changes in benefits.

8. "Health care insurer" means a disability insurer, group disability insurer, blanket disability insurer, health care services organization, hospital service corporation, prepaid dental plan organization, medical service corporation, dental service corporation or optometric service corporation or a hospital, medical, dental and optometric service corporation.

9. "Health care setting" means an institution providing health care services, including but not limited to, hospitals and other licensed inpatient centers, ambulatory surgical or treatment centers, skilled nursing centers, residential treatment centers, diagnostic, laboratory and imaging centers and rehabilitation and other therapeutic health settings.

10. "Indirect denial" means a failure to communicate authorization or nonauthorization to the member by the utilization review agent within the prescribed time frames pursuant to section 20-3404 after the utilization review agent receives the request for a covered service.

11. "Internal levels of review" means:

(a) An expedited medical review and expedited appeal pursuant to section 20-2534.

(b) An initial internal appeal pursuant to section 20-2535.

(c) A voluntary internal appeal pursuant to section 20-2536, if applicable.

12. "Provider" means the physician or other licensed practitioner identified to the utilization review agent as having primary responsibility for providing care, treatment and services rendered to a patient.

13. "Rescission" means a retroactive cancellation of coverage that is not related to a failure to timely pay required premiums.

14. "Service" means a diagnostic or therapeutic medical or health care service, benefit or treatment.

15. "Utilization review" means a system for reviewing the appropriate and efficient allocation of inpatient hospital resources, inpatient medical services and outpatient surgery services that are being given or are proposed to be given to a patient, and of any medical, surgical and health care services or claims for services that may be covered by a health care insurer depending on determinable contingencies, including without limitation outpatient services, in-office consultations with medical specialists, specialized diagnostic testing, mental health services, emergency care and inpatient and outpatient hospital services. Utilization review does not include elective requests for the clarification of coverage.

16. "Utilization review agent" means a person or entity that performs utilization review. For purposes of article 2 of this chapter, utilization review agent has the same meaning prescribed in section 20-2530.  For purposes of this chapter, utilization review agent does not include:

(a) A governmental agency.

(b) An agent that acts on behalf of the governmental agency.

(c) An employee of a utilization review agent.

17. "Utilization review plan" means a summary description of the utilization review guidelines, protocols, procedures and written standards and criteria of a utilization review agent.

B. For the purposes of this chapter, utilization review by an optometric service corporation applies only to nonsurgical medical and health care services.
A.R.S. § 20-401.04 — Arizona Code / Title 20 / Chapter 2 / Article 5 / Section 401.04
20-401.04 Action by attorney general to enforce order or decision of court or director; foreign decrees
Status: in_force

20-401.04. Action by attorney general to enforce order or decision of court or director; foreign decrees

A. The attorney general, on request of the director, may proceed in the courts of this state or any reciprocal state to enforce an order or decision in any court proceeding or any administrative proceeding before the director or any foreign decree.

B. The director shall determine which states and territories qualify as reciprocal states and shall maintain at all times an up-to-date list of those states.

C. A copy of any foreign decree authenticated as provided by the laws of this state may be filed in the office of the clerk of any superior court in this state. The clerk, on verifying with the director that the decree or order qualified as a foreign decree, shall treat the foreign decree in the same manner as a decree of a superior court in this state. A foreign decree so filed has the same effect and shall be deemed as a decree of a superior court in this state, and is subject to the same procedures, defenses and proceedings for reopening, vacating or staying as a decree of a superior court in this state and may be enforced or satisfied in like manner.

D. At the time of the filing of the foreign decree, the attorney general shall make and file with the clerk of the court an affidavit setting forth the name and last known post office address of the defendant.

E. Promptly on the filing of the foreign decree and the affidavit, the clerk shall mail notice of the filing of the foreign decree to the defendant at the address given and to the director and shall make a note of the mailing in the docket. In addition, the attorney general may mail a notice of the filing of the foreign decree to the defendant and to the director and may file proof of mailing with the clerk. Lack of mailing notice of filing by the clerk does not affect the enforcement proceedings if proof of mailing by the attorney general has been filed.

F. An execution or other process for enforcement of a foreign decree filed under this section shall not issue until thirty days after the date the decree is filed.

G. If the defendant shows the superior court that an appeal from the foreign decree is pending or will be taken, or that a stay of execution has been granted, the court shall stay enforcement of the foreign decree until the appeal is concluded, the time for appeal expires, or the stay of execution expires or is vacated, on proof that the defendant has furnished the security for the satisfaction of the decree required by the state in which it was rendered.

H. If the defendant shows the superior court any ground on which enforcement of a decree of any superior court in this state would be stayed, the court shall stay enforcement of the foreign decree for an appropriate period, on requiring the same security for satisfaction of the decree that is required in this state.
A.R.S. § 20-220 — Arizona Code / Title 20 / Chapter 2 / Article 1 / Section 220
20-220 Certificate of authority; refusal to renew; revocation or suspension; civil penalty
Status: in_force

20-220. Certificate of authority; refusal to renew; revocation or suspension; civil penalty

A. The director may after a hearing refuse to renew or may revoke or suspend an insurer's certificate of authority, in addition to other grounds therefor in this title, if the insurer:

1. Violates any provision of this title other than a provision as to which refusal, suspension or revocation is mandatory.

2. Knowingly fails to comply with any lawful rule or order of the director.

3. Is found by the director to be in unsound condition or in such condition as to render its further transaction of insurance in this state hazardous to its policyholders or to the people of this state.

4. Usually compels claimants under its policies to accept less than the amount due them or to bring suit against it to secure full payment thereof.

5. Refuses to be examined or to produce its accounts, records and files for examination by the director when required.

6. Fails to pay any final judgment rendered against it in this state within thirty days after the judgment becomes final.

7. Is affiliated with and under the same general management or interlocking directorate or ownership as another insurer which transacts direct insurance in this state without having a certificate of authority therefor, except as permitted to a surplus lines insurer under article 5 of this chapter.

B. If after a hearing the director finds grounds pursuant to subsection A to suspend or revoke an insurer's certificate of authority, the director may impose, in lieu of or in addition to such suspension or revocation, the following civil penalties:

1. A penalty not to exceed one thousand dollars for each violation and not to exceed an aggregate of ten thousand dollars within any six-month period with respect to unintentional violations.

2. A penalty not to exceed five thousand dollars for each violation and not to exceed an aggregate of fifty thousand dollars within any six-month period with respect to intentional violations. The insurer shall pay the civil penalty to the director who shall deposit it, pursuant to sections 35-146 and 35-147, in the state general fund. The civil penalty is in addition to any other penalty imposed by law.

C. The director may adopt rules to provide the criteria to be used for identifying insurers who are found to be in a condition that would render the continuance of their business hazardous to their policyholders or the people of this state.
A.R.S. § 20-301 — Arizona Code / Title 20 / Chapter 2 / Article 3 / Section 301
20-301 Report of actions
Status: in_force

20-301. Report of actions

A. Within thirty days after the final disposition of the matter, an insurance producer shall report to the director any administrative action taken against the producer in another jurisdiction or by another governmental agency in this state.  The report shall include a copy of the order, consent to order or other relevant dispositive document.

B. Within thirty days after the filing date of a criminal conviction in any jurisdiction, an insurance producer who has been convicted shall report the conviction to the director.  The report shall include a copy of the initial indictment, information or complaint filed, the final judgment entered by the court and all other relevant legal documents.
A.R.S. § 20-392 — Arizona Code / Title 20 / Chapter 2 / Article 4.1 / Section 392
20-392 Rate agreements among insurers prohibited
Status: in_force

20-392. Rate agreements among insurers prohibited

A. Except with respect to apportionment agreements among insurers approved by the director pursuant to section 20-395, an insurer shall not assume any obligation to any person, other than a policyholder or other insurers which, with it, are under common control or management or are members of a joint underwriting or joint reinsurance organization, to use or adhere to certain rates or rules. No person other than the director may impose any penalty or other adverse consequence for failure of an insurer to adhere to certain rates or rules.

B. Members and subscribers of rate service organizations or advisory organizations may use the work products and services of such organizations as their individual judgment may dictate. Such use by two or more authorized insurers shall not be sufficient to support a finding that an agreement to adhere exists and may be used only for the purpose of supplementing direct evidence of such an agreement.
A.R.S. § 20-1586 — Arizona Code / Title 20 / Chapter 6 / Article 9 / Section 1586
20-1586 Rebates or reduced fees
Status: in_force

20-1586. Rebates or reduced fees

A. No title insurer nor title insurance agent shall knowingly make any rebate of any portion of the fee or charge established pursuant to section 20-376.

B. No title insurer nor title insurance agent shall knowingly quote any fee or make any charge for a title insurance policy to any person which is less than that allowable pursuant to section 20-376. The amount by which any fee or charge is less than that prescribed by section 20-376 is an unlawful rebate.
A.R.S. § 20-1104 — Arizona Code / Title 20 / Chapter 5 / Article 1 / Section 1104
20-1104 Insurable interest with respect to personal insurance; definition
Status: in_force

20-1104. Insurable interest with respect to personal insurance; definition

A. Any individual of competent legal capacity may procure or effect an insurance contract on his own life or body for the benefit of any person.  But no person shall procure or cause to be procured any insurance contract on the life or body of another individual unless the benefits under such contract are payable to the individual insured or his personal representatives, or to a person having, at the time when the contract was made, an insurable interest in the individual insured.

B. If the beneficiary, assignee or other payee under any contract made in violation of this section receives from the insurer any benefits thereunder accruing on the death, disablement or injury of the individual insured, the individual insured or his executor or administrator, as the case may be, may maintain an action to recover such benefits from the person so receiving them.

C. "Insurable interest" with reference to personal insurance includes only interests as follows:

1. In the case of individuals related closely by blood or by law, a substantial interest engendered by love and affection.

2. In the case of other persons, a lawful and substantial economic interest in having the life, health or bodily safety of the individual insured continue, as distinguished from an interest which would arise only by, or would be enhanced in value by, the death, disablement or injury of the individual insured.

3. An individual party to a contract or option for the purchase or sale of an interest in a business partnership or firm, or of shares of stock of a closed corporation or of an interest in the shares, has an insurable interest in the life of each individual party to the contract and for the purposes of the contract only, in addition to any insurable interest which may otherwise exist as to the life of the individual.

4. A charitable organization as provided in section 501(c)(3) of the internal revenue code, which has a policy ownership interest has an insurable interest in the life of each proposed insured who joins with the charitable organization in applying for a life insurance policy naming the charitable organization as owner and irrevocable beneficiary.
A.R.S. § 20-2607 — Arizona Code / Title 20 / Chapter 16 / Article 1 / Section 2607
20-2607 Information to applicants
Status: in_force

20-2607. Information to applicants

A. An insurer that delivers or issues for delivery in this state a variable life insurance policy shall deliver the following information to the applicant for the policy:

1. A summary explanation of the principal features of the policy. The summary explanation shall be in nontechnical terms and shall include a description of the manner in which the variable benefits will reflect the investment experience of the separate account and the factors that affect the variation. The explanation shall include notice of the requirements of section 20-2604, subsection D, paragraph 1, subdivision (e) and paragraph 7.

2. A statement of the investment policy of the separate account, including a description of both:

(a) The investment objectives of the separate account and the principal types of investments that will be made.

(b) The restrictions or limitations on the manner in which the operations of the separate account will be conducted.

3. A statement of the net investment return of the separate account for each of the last ten years, or if the separate account has been in existence for less than ten years, a statement of the net investment return of the separate account for each of the years that the separate account has been in existence.

4. A statement of the charges that were levied against the separate account during the previous year.

5. A summary of the method the insurer will use in valuing the assets that are held by the separate account.

6. A summary of the federal income tax aspects of the policy that apply to the insured, the policyholder and the beneficiary.

7. Illustrations of benefits that are payable under the variable life insurance contract. The insurer shall prepare the illustrations. The illustrations shall not include projections of past investment experience into the future or attempted predictions of future investment experience. This paragraph does not prohibit the use of hypothetical assumed rates of return to illustrate possible levels of benefits if the illustration makes it clear that the assumed rates are hypothetical only.

B. This section is satisfied if a disclosure that contains the information required by this section is delivered to the applicant. The disclosure shall either:

1. Be a prospectus that satisfies the requirements of the securities act of 1933 (15 United States Code sections 77a through 77aa) and that the securities and exchange commission declares effective.

2. Contain the information and reports that are required by the employee retirement income security act of 1974 (29 United States Code sections 1001 through 1461) if the policies are exempt from the registration requirements of the securities act of 1933.
A.R.S. § 20-415 — Arizona Code / Title 20 / Chapter 2 / Article 5 / Section 415
20-415 Statement of surplus lines insurance business transacted by broker; reporting periods; exception
Status: in_force

20-415. Statement of surplus lines insurance business transacted by broker; reporting periods; exception

A. Each surplus lines broker shall file with the director a statement of all surplus lines insurance business covering Arizona risks transacted by the broker during the period for which the statement is being filed. The statement shall be on a form prescribed by the director and shall show:

1. Gross amount of each kind of insurance transacted.

2. Aggregate gross premiums charged.

3. Aggregate of return premiums paid to insureds.

4. Aggregate of net premiums.

5. Such additional information as may reasonably be required by the director.

B. The statement required by subsection A of this section is due on or before February 15 of each year for the preceding July through December and on or before August 15 of each year for the preceding January through June for business covering Arizona single-state risks, except that for multistate transactions occurring on or before December 31, 2014, the statement shall be due on or before the date specified in subsection D of this section.

C. If a clearinghouse is established and is in operation and if the director enters into a multistate agreement or compact pursuant to section 20-416.01, each surplus lines broker shall file quarterly, with the clearinghouse responsible for administering the compact or multistate agreement, a notarized statement of all surplus lines insurance business covering multistate risks transacted by the broker on behalf of insureds whose home state is Arizona during the calendar quarter for which the statement is being filed.  The statement shall be on a form prescribed by the clearinghouse and shall include all information required by the clearinghouse. A facsimile of the original notarized statement may be submitted in lieu of the original notarized statement. The broker shall maintain the original notarized statement for a period of six years after the calendar year in which the statement was filed.

D. The statement required by subsection C of this section is due on or before February 15 for the quarter ending the preceding December 31, May 15 for the quarter ending the preceding March 31, August 15 for the quarter ending the preceding June 30 and November 15 for the quarter ending the preceding September 30.

E. A surplus lines broker is not responsible for reporting any fees or remitting any premium taxes or stamping fees due on fees charged by an insurance producer in connection with the transaction of surplus lines insurance.
A.R.S. § 20-1503 — Arizona Code / Title 20 / Chapter 6 / Article 7 / Section 1503
20-1503 Arizona standard fire policy
Status: in_force

20-1503. Arizona standard fire policy

A. No policy of fire insurance covering property located in this state shall be made, issued or delivered unless it conforms as to all provisions and the sequence thereof with the basic policy commonly known as the New York standard fire policy, edition of 1943.  Such policy is designated as the Arizona standard fire policy.

B. The Arizona standard fire policy may exclude coverage for loss by fire or other perils insured against if the loss is caused directly or indirectly by terrorism and involves risks other than a type of risk to which article 12 of this chapter applies.

C. The director shall file in his office and thereafter maintain so on file, a true copy of the Arizona standard fire policy, designated as such and bearing the director's authenticating certificate and signature and the date of filing. Provisions to be contained on the first page of the policy may be rewritten, supplemented and rearranged to facilitate policy issuance and to include matter which may otherwise properly be added by endorsement.
A.R.S. § 20-1057.10 — Arizona Code / Title 20 / Chapter 4 / Article 9 / Section 1057.10
20-1057.10 Eosinophilic gastrointestinal disorder; formula
Status: in_force

20-1057.10. Eosinophilic gastrointestinal disorder; formula

A. Any contract or evidence of coverage that is offered by a health care services organization and that contains a prescription drug benefit shall cover amino acid-based formula that is ordered by a physician or a registered nurse practitioner if:

1. The enrollee has been diagnosed with an eosinophilic gastrointestinal disorder.

2. The enrollee is under the continuous supervision of a physician who is licensed pursuant to title 32, chapter 13 or 17 or a registered nurse practitioner who is licensed pursuant to title 32, chapter 15.

3. There is risk of a mental or physical impairment without the use of the formula.

B. A health care services organization shall cover at least seventy-five per cent of the cost of the formula.  The health care services organization may limit the maximum annual benefit for formula under this section to twenty thousand dollars.

C. This section does not apply to limited benefit coverage as defined in section 20-1137.
A.R.S. § 20-873 — Arizona Code / Title 20 / Chapter 4 / Article 4 / Section 873
20-873 Consolidation or merger
Status: in_force

20-873. Consolidation or merger

A. A domestic fraternal benefit society may consolidate or merge with any other society if it complies with this section. The society shall file the following with the director:

1. A certified copy of the written contract that contains in full the terms and conditions of the consolidation or merger.

2. A sworn statement by the president and secretary or other corresponding officers of each society that shows the financial condition of each society on a date designated by the director. The date shall not be earlier than December 31 next preceding the date of the contract.

3. A verified certificate of the president and secretary or other corresponding officers of each society stating that the consolidation or merger has been approved by a two-thirds vote of the supreme governing body of each society and that the vote was conducted at a regular or special meeting of each society, or if allowed by the laws of the society, by mail.

4. Evidence that at least sixty days before the action of the supreme governing body of each society the text of the contract was furnished to all members of each society either by mail or publication in full in the official publication of each society.  The affidavit of any officer of the society or of any person who is authorized by the society to mail any notice or document stating that the notice or document was addressed and mailed is prima facie evidence that the notice or document was furnished to the addressees.

B. The director shall approve the consolidation or merger and shall issue a certificate of approval if the director finds that the contract conforms with the requirements of this section, that the financial statements are correct and that the consolidation or merger is just and equitable to the members of each society. On the director's approval, the contract is in full force and effect, except that if one of the parties to the contract is incorporated under the laws of any other state or territory, the consolidation or merger does not become effective until the consolidation or merger is approved pursuant to the laws of that state or territory and a certificate of approval is filed with the director of the department of insurance and financial institutions in this state. If the laws of the other state or territory do not provide for consolidation or merger, the consolidation or merger does not become effective until it has been approved by and a certificate of approval is filed with the insurance director in that state or territory.

C. After the consolidation or merger becomes effective, all of the rights, franchises and interests of the consolidated or merged societies in and to real, personal and mixed property are vested in the society resulting from or remaining after the consolidation or merger. No other instrument is necessary to convey any property interests, except that conveyances of real property shall be evidenced by proper deeds. The title to any real estate or any interest in real estate that is vested under the laws of this state in any of the societies that are consolidated or merged does not revert or is not impaired in any way by reason of the merger or consolidation but vests absolutely in the society that results from or remains after the consolidation or merger.
A.R.S. § 20-1562 — Arizona Code / Title 20 / Chapter 6 / Article 9 / Section 1562
20-1562 Definitions
Status: in_force

20-1562. Definitions

In this article, unless the context otherwise requires:

1. "Abstract of title" means a written representation that is provided pursuant to a written or oral contract that is intended to be relied on by the person who has contracted for the receipt of the representation. The abstract of title shall include all recorded conveyances, instruments or documents that impart constructive notice with respect to the chain of title to the real property described in the abstract. An abstract of title is not a title insurance policy.

2. "Applicants for insurance" shall be deemed to include all those, whether or not prospective insureds, who from time to time apply to a title insurer, or to its agent, for title insurance, and who at the time of such application are not agents for such title insurer.

3. "Business of title insurance" shall be deemed to be:

(a) The making as insurer, guarantor or surety, or proposing to make as insurer, guarantor or surety, of any contract or policy of title insurance.

(b) The transacting of, or proposing to transact, any phase of title insurance, including solicitation, negotiation preliminary to execution, execution of a contract of title insurance, insuring and transacting matters subsequent to the execution of the contract and arising out of it, including reinsurance.

(c) The doing of, or proposing to do, any business in substance equivalent to any of the foregoing.

4. "Net retained liability" means the total liability retained by a title insurer under any policy or contract of insurance, or under a single insurance risk as defined in or computed in accordance with paragraph 7, after the purchase of reinsurance.

5. "Preliminary report", "commitment" or "binder" means a report that is furnished in connection with an application for title insurance and that offers to issue a title insurance policy subject to the stated exceptions set forth in the report or incorporated by reference. The reports are not abstracts of title and the rights, duties and responsibilities relating to the preparation and issuance of an abstract of title do not apply to the issuance of a report. The report is not a representation as to the condition of title to real property but does constitute a statement of the terms and conditions on which the issuer is willing to issue its title insurance policy if the offer is accepted.

6. "Risk premium" for title insurance means that portion of the fee charged by a title insurer, or agent of a title insurer, to an insured or to an applicant for insurance, for the assumption by the title insurer of the risk created by the issuance of the title insurance policy.

7. "Single insurance risk" means the insured amount of any policy or contract of title insurance issued by a title insurer unless two or more policies or contracts are simultaneously issued on different estates in identical real property, in which event, it means the sum of the insured amounts of all such policies or contracts, except that any such policy or contract that insures a mortgage interest or a vendor's interest that is excepted in a fee or leasehold policy or contract, and which does not exceed the insured amount of such fee or leasehold policy or contract, shall be excluded in computing the amount of a single insurance risk.

8. "Title insurance" means insuring, guaranteeing or indemnifying owners of real property or others interested therein against loss or damage suffered by reason of liens, encumbrances upon, defects in or the unmarketability of the title to such property, guaranteeing, warranting or otherwise insuring the correctness of searches relating to the title to real property, or doing any business in substance equivalent to any of the foregoing.

9. "Title insurance agent" means a domestic or foreign stock corporation or limited liability company authorized in writing by a title insurer to solicit insurance and collect premiums and to issue or countersign policies in its behalf, except that the term "title insurance agent" shall not include officers or salaried employees of any title insurer authorized to do a title insurance business within this state.

10. "Title insurance plant" means a set of records in which an entry has been made of all documents or matters which under the law impart constructive notice of matters affecting title to real property or any interest therein or encumbrance thereon and which have been filed or recorded in the county for which such title plant is maintained for a period of not less than the immediately preceding twenty years. In order to constitute a title insurance plant such records shall include:

(a) An index or indices in which notations of or references to any such documents that describe the property affected thereby are posted, entered or otherwise included, according to the property described therein, or copies or briefs of all such documents that describe the property affected thereby which are sorted and filed according to the property described therein.

(b) An index or indices in which all other such documents are posted, entered or otherwise included, according to the name or names of the parties whose title to real property or any interest therein or encumbrance thereon is affected.

11. "Title insurance policy" means a written instrument or contract by means of which title insurance liability is accepted.

12. "Title insurer" means any domestic company organized under the provisions of this title for the purpose of insuring titles to real property, any title insurance company organized under the laws of another state and licensed to insure titles to real estate within this state pursuant to the provisions of this article, and any domestic or foreign company having the power and authorized to insure titles to real estate within this state as of January 1, 1968 which meet the requirements of this article.
A.R.S. § 20-481.02 — Arizona Code / Title 20 / Chapter 2 / Article 8 / Section 481.02
20-481.02 Tender offers; required statements; disclosures; approval or disapproval by director; definition
Status: in_force

20-481.02. Tender offers; required statements; disclosures; approval or disapproval by director; definition

A. No person other than the issuer shall make a tender for or a request or invitation for tenders of a voting security of a domestic insurer or enter into any agreement to exchange securities or seek to acquire in the open market or in any other place any voting security of a domestic insurer if, after the consummation thereof, such person would, directly or indirectly, by conversion or by the exercise of any right to acquire, be in control of such insurer. No person may enter into an agreement to merge with or to otherwise acquire control of a domestic insurer or a person who controls a domestic insurer unless, at the time the offer, request or invitation is made or the agreement is entered into or before the acquisition of the securities, if no offer or agreement is involved, such person has filed with the director and has sent to such insurer a statement containing the information required by section 20-481.03 and the offer, request, invitation, agreement or acquisition has been approved by the director.

B. With respect to the acquisition of a domestic insurer by a person, directly or indirectly through an affiliate or affiliates, who is not required to file a statement pursuant to subsection A of this section because such person is not primarily engaged in the business of insurance, such person, at least thirty days before the effective date of the acquisition of the domestic insurer, shall file with the director a statement containing the information required by section 20-481.03. If the director finds that the acquisition does not meet the requirements of section 20-481.07, subsection A, the director shall issue an order disapproving the acquisition of the domestic insurer and shall require the person to make an expeditious divestiture of such insurer. The director shall have the authority to take such actions as are necessary to assure such divestiture.

C. A controlling person of a domestic insurer that seeks to divest its controlling interest in the domestic insurer shall file with the director, with a copy to the insurer, a confidential notice of its proposed divestiture at least thirty days before the cessation of control. The director shall determine if the party seeking to divest or to acquire a controlling interest in the insurer will be required to file for and obtain approval of the transaction.  The information shall remain confidential until the conclusion of the transaction unless the director determines that confidential treatment will interfere with enforcement of this section.  This subsection does not apply if the statement referred to in subsection A of this section is filed.

D. The director may employ insurance analysts, hearing examiners and such other staff as necessary to ensure compliance with this section. Such costs shall be paid by the insurance examiners' revolving fund in accordance with section 20-159.

E. The filing requirements provided in subsection A of this section shall not be deemed in conflict with federal securities acts where such federal securities acts apply. No offer, transaction, proposed transaction, agreement or acquisition subject to approval of the director pursuant to subsection A of this section shall become effective until approved by the director.

F. Notwithstanding subsection C of this section, the acquiring person shall file a preacquisition notification with the director that contains the information prescribed in section 20-481.25, subsection C for all transactions under this section.

G. For the purposes of this section:

1. "Domestic insurer" includes any person controlling a domestic insurer, unless the director determines that the person is either directly or through its affiliates primarily engaged in business other than the business of insurance.

2. Person does not include any securities broker in the usual and customary broker's function holding less than twenty per cent of the voting securities of an insurance company or of any person that controls an insurance company.
A.R.S. § 20-846 — Arizona Code / Title 20 / Chapter 4 / Article 3 / Section 846
20-846 Individual health insurance policies; mandatory coverage exemption; definitions
Status: in_force

20-846. Individual health insurance policies; mandatory coverage exemption; definitions

A. A hospital service corporation, medical service corporation or hospital and medical service corporation may issue a subscription contract to an uninsured individual that is not subject to the requirements of any of the following:

1. Section 20-461, subsection A, paragraph 17 and subsection B.

2. Section 20-826, subsections F, J, K, U, V, W and X.

3. Section 20-841, subsections A and C.

4. Sections 20-841.01, 20-841.02, 20-841.03, 20-841.04, 20-841.06, 20-841.07 and 20-841.08.

5. Section 20-841.05, subsections B and E.

B. For the purposes of this section:

1. "Health insurance coverage":

(a) Means a health care plan or arrangement that pays for or furnishes medical or health services and that is issued by a disability insurer, group disability insurer, blanket disability insurer, health care services organization, hospital service corporation, medical service corporation or medical, hospital, dental and optometric service corporation or a similar entity in another state.

(b) Includes a self-insured or self-funded employee benefit plan or multiemployer employee benefit plan created pursuant to 29 United States Code section 186(c) if the regulation of that plan is preempted by section 514(b) of the employee retirement insurance security act of 1974 (29 United States Code section 1144(b)).

(c) Does not include limited benefit coverage as defined in section 20-1137.

2. "Uninsured individual" means a person who has either:

(a) Not had health insurance coverage for the ninety days immediately before the effective date of coverage issued pursuant to this section, except that this requirement does not apply at the renewal of coverage pursuant to this section.

(b) Lost health insurance coverage in one of the following ways within ninety days immediately before the effective date of coverage issued pursuant to this section:

(i) The individual left a job that provided health insurance coverage.

(ii) The individual's employer discontinued offering health insurance coverage.

(iii) The individual exhausted continuation coverage under a COBRA continuation provision as defined in section 20-2301.

(iv) The individual's family health insurance coverage was discontinued due to the death of a spouse or a divorce.

(v) The individual attained the maximum age for dependent coverage under a health insurance policy.

(vi) The individual's participation in a public health care program was discontinued.
A.R.S. § 20-1492 — Arizona Code / Title 20 / Chapter 6 / Article 6 / Section 1492
20-1492 Group excess liability insurance; eligible groups
Status: in_force

20-1492. Group excess liability insurance; eligible groups

A. An authorized insurer or an unauthorized insurer as provided in chapter 2, article 5 of this title may offer group excess liability insurance in this state. An authorized insurer that issues a group excess liability insurance policy in this state shall file the group policy and the certificate of insurance forms with the department pursuant to section 20-398 but is exempt from the requirements of section 20-385.  The terms of the certificate of insurance shall be consistent with the terms of the group excess liability insurance policy pursuant to which the certificate of insurance is issued.

B. An insurer may issue or deliver a group excess liability insurance policy and certificate of insurance in this state only pursuant to this article. In addition to excess liability coverage, a group excess liability insurance policy may also provide excess uninsured motorist, excess underinsured motorist and excess uninsured or underinsured liability coverage to certificate holders.  The terms and conditions for any excess uninsured motorist coverage and excess underinsured motorist coverage provided under the group policy shall comply with this title.

C. Notwithstanding subsection B of this section, a group excess liability insurance policy may provide coverage for excess uninsured motorist or underinsured motorist coverage in amounts that exceed the limits set forth in section 20-259.01.

D. An insurer may issue a group excess liability insurance policy to an employer that insures one or more employees of the employer.  For the purposes of this subsection:

1. "Employees" include:

(a) The officers, directors, managers and employees of the employer.

(b) The partners if the employer is a partnership.

(c) The officers, managers and employees of a subsidiary or any affiliated corporations, companies, limited liability companies, firms or partnerships.

(d) The members of the employee's immediate family.

2. "Employer" includes any type of corporation, company, firm, limited liability company and partnership.

E. An insurer may establish underwriting criteria for the group policyholder and certificate holders that apply at issuance and renewal of the group policy and the certificate of insurance. Insurers shall treat all eligible groups of the same class in a like manner.

F. Nothing in this article shall apply to or otherwise prohibit the issuance of commercial excess liability insurance policies that provide coverage to one or more named insureds and its owners, employees, contractors, agents or representatives under a single limit of insurance.  For the purposes of this subsection, "commercial" means insurance that insures against the risks arising from business and commercial activity.