A.R.S. § 20-512.01 — Arizona Code / Title 20 / Chapter 3 / Article 1 / Section 512.01
20-512.01 Valuation of joint ventures, partnerships and limited liability companies
Status: in_force

20-512.01. Valuation of joint ventures, partnerships and limited liability companies

Joint ventures, partnerships and limited liability companies shall be valued based on the underlying equity reported in the entity's financial statements pursuant to the accounting practices and procedures manual adopted by the national association of insurance commissioners.
A.R.S. § 20-1098.09 — Arizona Code / Title 20 / Chapter 4 / Article 14 / Section 1098.09
20-1098.09 Grounds and procedures for license suspension or revocation
Status: in_force

20-1098.09. Grounds and procedures for license suspension or revocation

The director may suspend, revoke or refuse to renew the license of a captive insurer to transact insurance business in this state for any of the following reasons:

1. Insolvency or impairment of capital and surplus.

2. Refusal or failure to submit an annual report as prescribed in section 20-1098.07 or any other report or statement required by law or by lawful order of the director.

3. Failure to comply with the provisions of its own articles of incorporation, bylaws or other organizational document.

4. Failure to submit to an examination or any legal obligation related to the examination as prescribed in section 20-1098.08.

5. Refusal or failure to pay the cost of an examination as prescribed in section 20-1098.08.

6. Use of methods that, although not otherwise specifically prohibited by law, render its operation hazardous or its condition unsound with respect to the public or to its policyholders.

7. Failure to otherwise comply with this article.
A.R.S. § 20-340 — Arizona Code / Title 20 / Chapter 2 / Article 3.5 / Section 340
20-340 Definitions
Status: in_force

20-340. Definitions

In this article, unless the context otherwise requires:

1. "Bail bond" means any contract that is executed by a surety insurer for the release of a person who is arrested or confined for any actual or alleged violation of any federal, state or local criminal law where the released person's attendance in court when required by law and obedience to orders and judgment of any court is guaranteed.

2. "Bail bond agent" means an individual who is appointed by an insurer through a power of attorney to execute or countersign bail bonds in connection with judicial proceedings and who receives or is promised monies or other things of value for that service.

3. "Bail recovery agent" has the same meaning prescribed in section 13-3885.
A.R.S. § 20-431.03 — Arizona Code / Title 20 / Chapter 2 / Article 5.1 / Section 431.03
20-431.03 Life insurance policy illustrations; requirements; prohibitions
Status: in_force

20-431.03. Life insurance policy illustrations; requirements; prohibitions

A. An illustration that is used in the sale of a life insurance policy shall be clearly labeled life insurance illustration and shall contain all of the following:

1. The name of the insurer that issued the policy.

2. The name and business address of the producer or the insurer's authorized representative, if any.

3. The name, age and sex of the proposed insured, unless a composite illustration is allowed under this article.

4. The underwriting or rating classification on which the illustration is based.

5. The generic name of the policy, the company product name, if different from the generic name of the policy, and the form number.

6. The initial death benefit.

7. Dividend option election or application of nonguaranteed elements, if applicable.

B. When using an illustration in the sale of a life insurance policy, an insurer or its producers or other authorized representatives may not:

1. Represent the policy as anything other than a life insurance policy.

2. Use or describe nonguaranteed elements in a manner that is misleading or that has the capacity or tendency to mislead.

3. State or imply that the payment or amount of nonguaranteed elements is guaranteed.

4. Use an illustration that does not comply with this article.

5. Use an illustration that depicts policy performance that is more favorable to the policyowner than that produced by the illustrated scale.

6. Provide an applicant with an incomplete illustration.

7. Represent in any way that premium payments will not be required for each year of the policy in order to maintain the illustrated death benefits, unless that is the fact.

8. Use the term vanish or vanishing premium or a similar term that implies the policy becomes paid up to describe a plan for using nonguaranteed elements to pay a portion of future premiums.

9. Except for policies that can never develop nonforfeiture values, use a lapse-supported illustration.

10. Use an illustration that is not a self-supporting illustration.

C. If an interest rate that is used to determine the illustrated nonguaranteed elements is shown, the interest rate may not be greater than the earned interest rate underlying the disciplined current scale.
A.R.S. § 20-649 — Arizona Code / Title 20 / Chapter 3 / Article 4 / Section 649
20-649 Extension of time
Status: in_force

20-649. Extension of time

A. Except as provided in subsection D, if any law, rule, order or agreement fixes a period of time within which the insurer subject to a delinquency proceeding or the receiver may commence an action, and that period is enforceable and has not expired before the date of the commencement of the delinquency proceeding under this title, the receiver may commence the action before any of the following, whichever is later:

1. The end of the period, including any suspension of the period occurring on or after commencement of the delinquency proceeding under this title.

2. Five years after the entry of the order appointing the receiver.

3. A date set by the court that in no event is more than eight years after the entry of the order appointing the receiver.

B. Except as provided in subsection A or D, if any law, rule, order or agreement fixes a period of time within which the insurer subject to a delinquency proceeding or the receiver may file any pleading, motion, demand, notice or proof of claim or loss, may cure a default or may perform any other similar act and that period is enforceable and has not expired before the commencement of the delinquency proceeding, the receiver may file, cure or perform before either of the following, whichever is later:

1. The end of the period, including any suspension of the period occurring on or after the commencement of the delinquency proceeding under this title.

2. One hundred twenty days after the entry of the order appointing the receiver.

C. Except as provided in subsection D, if any law, rule, order or agreement fixes a period for commencing or continuing a civil action in any court on a claim against the insurer in receivership, and that period has not expired before the date of the commencement of the delinquency proceeding, the court may extend that period to permit the filing of a claim with the receiver pursuant to this article.

D. The extension of time provided under this section does not apply to any other time period imposed by this chapter, an agreement executed by the receiver and approved by the court or an order of the court.
A.R.S. § 20-123 — Arizona Code / Title 20 / Chapter 1 / Article 1 / Section 123
20-123 Homeowners insurers; data compilation; annual report; public posting
Status: in_force

20-123. Homeowners insurers; data compilation; annual report; public posting

(Rpld. 1/1/28)

A. Not later than April 1 of each year, each insurer that writes homeowners insurance in this state shall report to the director of the department of insurance and financial institutions in a manner and form as prescribed by the director of the department of insurance and financial institutions the following information on each homeowners insurance policy the insurer had in force during the prior calendar year in the geographic areas of this state designated as heightened fire risk areas by the director of the Arizona department of forestry and fire management for the prior calendar year:

1. If the policy was newly issued or renewed, the date the policy was issued or renewed.

2. If the policy was nonrenewed or canceled by the insurer, the insurer is not required to provide the reason for the nonrenewal or cancellation but shall provide:

(a) The date the policy ended.

(b) If the policy was nonrenewed, whether the policy was nonrenewed due to:

(i) Fire loss risk.

(ii) Condition of the premises.

(c) If the policy was canceled, whether the policy was canceled due to:

(i) Nonpayment of the premium.

(ii) Fire risk loss.

3. The zip code in which the insured property is located, and the director of the department of insurance and financial institutions may request additional geographic information to clarify the location within a specific zip code.

4. The total written premium for the policy.

5. The type of policy form.

6. The policy's deductible.

7. The total number of all of the paid claims for all of the insurer's homeowners policies:

(a) Due to fire loss.

(b) Due to reasons other than fire loss.

8. The total of all losses paid for all of the insurer's homeowners policies:

(a) Due to fire loss.

(b) Due to reasons other than fire loss.

9. The policy's coverage limits.

10. Any other information prescribed by the director of the department in rule, except that in any year the director of the department may require the reporting of any clarifying information that is consistent with the information requested in a data call issued by the national association of insurance commissioners on the residential property insurance market.

B. Except as provided in subsection D of this section, the information reported pursuant to subsection A of this section is confidential and is not subject to disclosure pursuant to title 39, chapter 1, article 2, discovery or subpoena, unless the subpoena is issued by the attorney general, a county attorney or a court at the request of the attorney general, a county attorney or a law enforcement agency, and the subpoena is not admissible in evidence in a private civil action.  If a subpoena is issued by the attorney general, a county attorney or any other law enforcement agency to the director for information reported to the director, the director shall provide notice to the insurer of the subpoena unless otherwise prohibited by law.

C. Notwithstanding subsection A of this section and in any year in which the national association of insurance commissioners issues a data call on the residential property insurance market, the director may prescribe a due date other than April 1 for the report required in subsection A of this section that coincides with the due date for the data call.

D. On or before December 31 of each year, the director shall prepare a report that compiles in an aggregated and anonymized manner the information submitted by insurers pursuant to subsection A of this section and shall submit the annual report to the governor, the speaker of the house of representatives and the president of the senate and shall provide a copy of this report to the secretary of state. The director shall make a copy of the report available on the department's publicly accessible website.
A.R.S. § 20-423 — Arizona Code / Title 20 / Chapter 2 / Article 5 / Section 423
20-423 Voluntary domestic organization of surplus lines brokers; membership; stamping fee collection; meetings; definition
Status: in_force

20-423. Voluntary domestic organization of surplus lines brokers; membership; stamping fee collection; meetings; definition

A. A voluntary domestic organization of surplus lines brokers that contracts with the director pursuant to section 20-167, subsection E shall be incorporated in this state as a nonprofit corporation. A surplus lines broker who is licensed and in good standing in this state may be a member in the organization if the broker pays any required membership fee and dues required to be paid by all members.

B. The organization may collect stamping fees pursuant to section 20-167 from any of the following:

1. A member of the organization.

2. A licensed surplus lines broker who is not a member of the organization.

3. A person who is no longer a licensed surplus lines broker if the stamping fee is paid in connection with transactions that the person effectuated while licensed as a surplus lines broker.

C. The organization shall hold an annual meeting of its members and may hold special meetings of its members. Members may participate in annual and special member meetings through the use of any means of communication if the communication allows all members participating in the meeting to simultaneously hear each other during the meeting and the organization provides a meeting notice that specifies how members can participate. Any member participating by this alternate means of communication is deemed to be present in person at the meeting for purposes of determining a quorum and voting and for any other purpose authorized or required by law.

D. Two percent of the total membership of the organization present in person or by proxy and entitled to vote at a meeting constitutes a quorum for the transaction of business at the meeting.

E. For the purposes of this section, "stamping fee" has the same meaning prescribed in section 20-167.
A.R.S. § 20-2332 — Arizona Code / Title 20 / Chapter 13 / Article 1 / Section 2332
20-2332 Eosinophilic gastrointestinal disorder; formula
Status: in_force

20-2332. Eosinophilic gastrointestinal disorder; formula

A. Any health benefit plan that is offered by an accountable health plan and that contains a prescription drug benefit shall cover amino acid-based formula that is ordered by a physician or by a registered nurse practitioner if:

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

2. The insured 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. An accountable health plan shall cover at least seventy-five per cent of the cost of the formula.  The accountable health plan 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. § 20-3113 — Arizona Code / Title 20 / Chapter 20 / Article 2 / Section 3113
20-3113 Surprise out-of-network bill; requirements; notice
Status: in_force

20-3113. Surprise out-of-network bill; requirements; notice

A. A bill for a health care service that was provided in a network facility by a health care provider that is not a contracted provider must meet one of the following requirements to qualify as a surprise out-of-network bill:

1. The bill was for emergency services, including under circumstances described by section 20-2803, subsection A and health care services directly related to the emergency services that are provided during an inpatient admission to any network facility.

2. The bill was for a health care service that was not provided in the case of an emergency and the health care provider or the provider's representative did not provide to the enrollee, or did not provide to the enrollee within a reasonable amount of time before the enrollee received the services, a written dated disclosure that contained the following information:

(a) Notice that contains the name of the billing health care provider and that states the health care provider is not a contracted provider.

(b) The estimated total cost to be billed by the health care provider or the provider's representative.

(c) Notice that the enrollee or the enrollee's authorized representative is not required to sign the disclosure to obtain medical care but if the enrollee or the enrollee's representative signs the disclosure, the enrollee may have waived any rights to dispute resolution under this article.

3. The bill was for a health care service that was not provided in the case of an emergency and the enrollee received the disclosure prescribed in paragraph 2 of this subsection, but the enrollee or the enrollee's authorized representative chose not to sign the disclosure.

B. Notwithstanding any provision of this article, a health insurer and any health plan offered by a health insurer shall comply with chapter 17, article 1 of this title.
A.R.S. § 20-256 — Arizona Code / Title 20 / Chapter 2 / Article 2 / Section 256
20-256 "Property insurance" defined
Status: in_force

20-256. "Property insurance" defined

"Property insurance" is insurance on real or personal property of every kind and interest therein, against loss or damage from any or all hazard or cause, and against loss consequential upon such loss or damage, other than noncontractual legal liability for any such loss or damage. Property insurance shall also include miscellaneous insurance as defined in paragraph 11 of section 20-252 except as to any noncontractual liability coverage includable therein.
A.R.S. § 20-1075 — Arizona Code / Title 20 / Chapter 4 / Article 9 / Section 1075
20-1075 Transactions with affiliates
Status: in_force

20-1075. Transactions with affiliates

A. A health care services organization shall not attempt to sell or otherwise transfer to an affiliate Arizona assets in excess of ten per cent of the organization's unimpaired capital or surplus as reported in its most recent annual statement, without prior approval by the director. If the director does not disapprove such sale or transfer within forty-five days of the date received by the director, the sale or transfer is deemed approved.

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.
A.R.S. § 20-2406 — Arizona Code / Title 20 / Chapter 14 / Article 1 / Section 2406
20-2406 Purchasing groups; exemption from certain laws relating to the group purchase of insurance
Status: in_force

20-2406. Purchasing groups; exemption from certain laws relating to the group purchase of insurance

A. A purchasing group which meets the criteria established under the federal liability risk retention act of 1986 is exempt from any law of this state relating to the creation of groups for the purchase of insurance, prohibition of group purchasing or any law that would discriminate against a purchasing group or its members.

B. This state shall not enact any law or the director shall not adopt a rule which imposes prohibitions or requirements on purchasing groups in violation of section 3(a) of the liability risk retention act of 1986, Public Law 99-563. A purchasing group is subject to all applicable laws of this state.
A.R.S. § 20-1011 — Arizona Code / Title 20 / Chapter 4 / Article 7 / Section 1011
20-1011 Operational expenses
Status: in_force

20-1011. Operational expenses

No more than thirty per cent of prepaid charges in the first year of operation, twenty-five per cent of prepaid charges in the second year of operation and twenty per cent of prepaid charges in any subsequent year shall be used for the marketing and administrative expenses of a prepaid dental plan organization, including all costs related to soliciting members and providers.
A.R.S. § 20-1097.06 — Arizona Code / Title 20 / Chapter 4 / Article 13 / Section 1097.06
20-1097.06 Contracts for underwriting
Status: in_force

20-1097.06. Contracts for underwriting

A corporation may contract with any company licensed to transact insurance in this state or any corporation organized pursuant to this title, under which contracts such company agrees, for consideration consisting of a specified premium, to assume the monetary obligations of the prepaid legal insurance contracts issued by the corporation upon the failure of the corporation itself to meet such obligations within the specified period. The corporation shall file each contract with the director, and such contract is subject to the approval of the director as to the fairness of its terms and premiums. Such contracts are deemed approved sixty days after the date of filing them with the director unless, before the expiration of the sixty day period, the director notifies the corporation in writing of the director's disapproval.
A.R.S. § 20-1406.08 — Arizona Code / Title 20 / Chapter 6 / Article 5 / Section 1406.08
20-1406.08 Prescription eyedrops; refills
Status: in_force

20-1406.08. Prescription eyedrops; refills

A. Beginning January 1, 2018, any policy that is issued, delivered or renewed by a group or blanket disability insurer and that provides coverage for prescription eyedrops to treat glaucoma or ocular hypertension may not deny coverage for a refill of a prescription for eyedrops to treat glaucoma or ocular hypertension if all of the following apply:

1. The insured requests the refill:

(a) For a thirty-day supply, at least twenty-three days and less than thirty days from the later of:

(i) The original date that the prescription was distributed to the insured.

(ii) The date of the most recent refill that was distributed to the insured.

(b) For a sixty-day supply, at least forty-five days and less than sixty days from the later of:

(i) The original date that the prescription was distributed to the insured.

(ii) The date of the most recent refill that was distributed to the insured.

(c) For a ninety-day supply, at least sixty-eight days and less than ninety days from the later of:

(i) The original date the prescription was distributed to the insured.

(ii) The date of the most recent refill that was distributed to the insured.

2. The prescription eyedrops to treat glaucoma or ocular hypertension prescribed by the health care provider are a covered benefit under the insured's policy.

3. The prescribing health care provider indicates on the original prescription that additional quantities of the prescription eyedrops to treat glaucoma or ocular hypertension are needed.

4. The refill requested by the insured does not exceed the number of additional quantities prescribed.

B. To the extent practicable, the requirements of this section are limited in quantity to the remaining dosage initially approved for coverage, except that any limited refilling may not limit or restrict coverage to any previously or subsequently approved prescription eyedrops to treat glaucoma or ocular hypertension and is subject to the terms and conditions of the policy that are applicable to this coverage.
A.R.S. § 20-679 — Arizona Code / Title 20 / Chapter 3 / Article 6 / Section 679
20-679 Limitations on filing of creditor's claims
Status: in_force

20-679. Limitations on filing of creditor's claims

A. Notwithstanding any other provision of this article, a covered claim shall not include a claim filed with the fund after the earlier of:

1. Eighteen months after the date of the order of liquidation.

2. The final date set by the court for the filing of claims against the liquidator or receiver of an insolvent insurer.

B. Notwithstanding subsection A of this section, a covered claim for workers' compensation shall include claims filed that meet the requirements of section 20-667, subsection A and the statutory filing requirements of section 23-1061.
A.R.S. § 20-587 — Arizona Code / Title 20 / Chapter 3 / Article 3 / Section 587
20-587 Excess deposits
Status: in_force

20-587. Excess deposits

An insurer may so deposit cash or eligible securities in an amount exceeding its deposit required or otherwise permitted under this title by not more than one hundred thousand dollars, for the purpose of absorbing fluctuations in the value of securities held in its deposit, and to facilitate the exchange and substitution of securities deposited. During the solvency of the insurer any such excess deposit or part thereof shall be released to the insurer upon its request. During the insolvency of the insurer the excess deposit shall be released only as provided in section 20-588.
A.R.S. § 20-405 — Arizona Code / Title 20 / Chapter 2 / Article 5 / Section 405
20-405 Prerequisites for participating in court action
Status: in_force

20-405. Prerequisites for participating in court action

Before an unauthorized insurer may initiate any action or proceeding in this state, the insurer shall procure a certificate of authority to transact insurance in this state, or deposit with the clerk of the court in which the action or proceeding is pending cash or securities, or file with the clerk a bond with good and sufficient sureties, to be approved by the court, in an amount to be fixed by the court sufficient to secure the payment of any costs and attorney's fees which may be assessed against the unauthorized insurer in the action. The court may in its discretion make an order dispensing with the deposit or bond where the insurer makes a showing satisfactory to the court that it maintains in any state funds or securities, in trust or otherwise, sufficient and available to satisfy any such assessment which may be entered in the action or proceeding, and that the insurer will pay any final judgment entered therein without requiring suit to be brought on the judgment in the state where the funds or securities are located.
A.R.S. § 20-1613 — Arizona Code / Title 20 / Chapter 6 / Article 10 / Section 1613
20-1613 Reporting and settlement of claims
Status: in_force

20-1613. Reporting and settlement of claims

A. In accordance with the terms of the applicable insurance contract, each claim shall be promptly reported to the insurer or to its designated claim representative and once reported shall be settled as soon as practicable.

B. Each claim shall be paid either by draft drawn upon the insurer, by electronic funds transfer or by check of the insurer to the order of the claimant to whom payment of benefits is due under the policy provisions or upon the claimant's direction paid to another.

C. No plan or arrangement shall be used whereby any person, firm or corporation, other than the insurer or its designated claim representative, shall be authorized to settle or adjust claims. The creditor shall not be designated as claim representative for the insurer in adjusting claims.
A.R.S. § 20-536 — Arizona Code / Title 20 / Chapter 3 / Article 2 / Section 536
20-536 Investments; type; limitations
Status: in_force

20-536. Investments; type; limitations

A. Every insurer may invest and maintain invested funds in cash and in the securities and investments described in this article without limitation unless a limitation for the securities and investments is otherwise prescribed in this article.

B. Except with the director's consent, an insurer shall not have invested at any one time more than twenty per cent of its assets in the classes of securities described in any one of the following sections of this article:

1. Section 20-546, exclusive of common stocks of public utilities and common stocks acquired under section 20-481.01.

2. Section 20-557.

3. Section 20-552.

C. Except with the director's consent, an insurer shall not have invested at any one time more than ten per cent of its assets in the classes of securities described in any one of the following sections of this article:

1. Section 20-548.

2. Section 20-547.

3. Section 20-543.

4. Section 20-555.
A.R.S. § 20-254 — Arizona Code / Title 20 / Chapter 2 / Article 2 / Section 254
20-254 "Life insurance" defined
Status: in_force

20-254. "Life insurance" defined

"Life insurance" is insurance on human lives and insurance appertaining thereto or connected therewith. The transacting of life insurance includes the granting of endowment benefits, additional benefits in the event of death or dismemberment by accident or accidental means, additional benefits in the event of the disability of the insured and optional modes of settlement of proceeds of life insurance. An insurer authorized to transact life insurance may also grant annuities.
A.R.S. § 20-768 — Arizona Code / Title 20 / Chapter 4 / Article 2 / Section 768
20-768 Required surplus funds
Status: in_force

20-768. Required surplus funds

A. A domestic reciprocal insurer formed under this article, if it has otherwise complied with the provisions of this title, may be authorized to transact insurance if it deposits and maintains on deposit with the state treasurer through the office of the director to transact property or vehicle insurance, surplus funds of not less than six hundred thousand dollars.

B. A domestic reciprocal insurer may be authorized to transact additional kinds of insurance if it has otherwise complied with the provisions of this title and possesses and so maintains on deposit surplus funds in amount equal to the minimum capital required of a stock insurer for authority to transact a like combination of kinds of insurance.
A.R.S. § 20-452.04 — Arizona Code / Title 20 / Chapter 2 / Article 6 / Section 452.04
20-452.04 Investigation by director of alleged violations
Status: in_force

20-452.04. Investigation by director of alleged violations

The director may investigate any person, whether licensed or not, for the purpose of determining if there has been any violation of section 20-452.01; however, if such investigation be upon a complaint, the complainant must be party to the contract of sale, trust deed, mortgage, or loan agreement, and must make such complaint within three months of the execution or any modification thereof.
A.R.S. § 20-145 — Arizona Code / Title 20 / Chapter 1 / Article 2 / Section 145
20-145 Evidentiary effect of certificate of authority
Status: in_force

20-145. Evidentiary effect of certificate of authority

When required, the director shall furnish his certificate as to the authority of any person to transact insurance, and such certificate shall be evidence of the facts set forth therein.
A.R.S. § 20-1097.10 — Arizona Code / Title 20 / Chapter 4 / Article 13 / Section 1097.10
20-1097.10 Capital, surplus and reserve requirements
Status: in_force

20-1097.10. Capital, surplus and reserve requirements

The director shall not authorize an applicant to sell prepaid legal insurance contracts within this state unless the applicant:

1. Possesses and thereafter maintains unimpaired capital of at least six hundred thousand dollars, except that an applicant to sell prepaid legal insurance contracts that only provide legal services plans related to the lawful use of firearms shall possess and maintain unimpaired capital of at least fifty thousand dollars.

2. Possesses and thereafter maintains surplus funds in an amount equal to at least fifty percent of the capital requirement prescribed in paragraph 1 of this section.

3. Possesses and thereafter maintains an unearned premium reserve that meets the requirements prescribed in section 20-506.
A.R.S. § 20-1676 — Arizona Code / Title 20 / Chapter 6 / Article 14 / Section 1676
20-1676 Notice of nonrenewal
Status: in_force

20-1676. Notice of nonrenewal

A. This article does not apply to the nonrenewal of insurance policies except as provided in subsection B of this section.

B. A nonrenewal of any policy of insurance to which this article applies is not effective unless the insurer sends a copy of the notice of nonrenewal to the insured's agent and to the named insured at least forty-five days before the end of the policy period of its intention not to renew the policy. The transfer of a policyholder between companies within the same insurance group or changes in deductibles, premium, amount of insurance or coverage are not refusals to renew.

C. Notice of nonrenewal is not required if either of the following occurs:

1. The insurer or a company within the same insurance group has offered to issue a renewal policy.

2. The named insured has obtained replacement coverage or has agreed in writing to obtain replacement coverage.

D. If an insurer provides the notice described in subsection B of this section and the insurer subsequently extends the policy for ninety days at the request of the policyholder, an additional notice of nonrenewal is not required with respect to the extension.

E. If the notice of nonrenewal is sent less than forty-five days before expiration, the coverage remains in effect until forty-five days after the notice is sent. Earned premium for any period of coverage that extends beyond the expiration date shall be considered pro rata based on the previous year's rate.
A.R.S. § 20-2901 — Arizona Code / Title 20 / Chapter 18 / Article 1 / Section 2901
20-2901 Definitions
Status: in_force

20-2901. Definitions

In this article, unless the context otherwise requires:

1. "Applicant" means a provider organization that submits an application to the contractor to provide continuing education courses.

2. "Approved continuing education course" means any course that has been approved by at least five other states or that is approved by a contractor or automatically approved pursuant to section 20-2904.

3. "Approved provider" means an organization or individual that offers an approved continuing education course and that is authorized by the contractor to offer the course to a licensee for credit toward the licensee's continuing education requirements.

4. "Continuously licensed" means that a licensee's license has not terminated for any reason.  For the purposes of this paragraph, a license that expires under section 20-289, subsection E is not considered to have terminated if the late fee is timely paid and the license is renewed or the license is placed on inactive status pursuant to section 20-289.01.

5. "Contractor" means the person who has a contract with the department to approve continuing education providers and courses and to administer the continuing education program and who is paid through fees collected from approved providers when the approved providers apply for continuing education course approval.

6. "Credit hour" means the value assigned to an hour of instruction in an approved continuing education course.

7. "Ethics training" means continuing education course content regarding the ethical responsibilities insurance producers owe to insurers, applicants, policyholders, regulators, insurance professionals and the public.

8. "License period" means the period between the date an Arizona insurance license is issued or last renewed and the expiration date of the Arizona insurance license.

9. "Licensee" means an individual insurance producer licensed for major line insurance as defined in section 20-281. Licensee does not include any business entity.

10. "Nonresident licensee" means a licensee who is applying to renew a nonresident license in this state.

11. "Provider organization" means a person that provides continuing education courses but that has not yet been accepted as an approved provider pursuant to section 20-2904.
A.R.S. § 20-203 — Arizona Code / Title 20 / Chapter 2 / Article 1 / Section 203
20-203 "Domestic" insurer defined
Status: in_force

20-203. "Domestic" insurer defined

A "domestic" insurer is one formed under the laws of this state.
A.R.S. § 20-1803 — Arizona Code / Title 20 / Chapter 8 / Article 1 / Section 1803
20-1803 Issuance of permit
Status: in_force

20-1803. Issuance of permit

A. The director shall review applications for completeness and issue a report of deficiencies to the applicant within sixty days of receipt of the application. The director shall issue a permit to the provider within thirty days of the receipt of a completed application and exhibits and payment of the fee by the applicant, and proof of compliance by the applicant with the provisions of sections 20-1804 and 20-1806. If the applicant has already paid the fee as a part of the process to receive a provisional permit under subsection E of this section, this subsection does not establish an additional fee. The director shall issue an order refusing the permit if the applicant does not meet the requirements therefor. The permit shall be subject to the conditions imposed pursuant to sections 20-1804 through 20-1806 allowing the provider to enter into life care contracts with respect to the number of living units and facility and the number of contract holders to be provided services in their private residences described in the application.

B. A permit issued under this section shall remain in full force, subject to the provisions of this chapter.

C. A permit issued pursuant to this section shall contain, in a prominent location, a statement that the issuance of a permit pursuant to section 20-1803 does not constitute approval, recommendation or endorsement by the department or director, nor does such a permit evidence the accuracy or completeness of the information set out in the application or the annual report of the provider.

D. All permits shall be nontransferable.

E. The director shall review an application for a provisional permit for completeness and issue a report of deficiencies to the applicant within sixty days of receipt of the application. The director may grant an applicant a provisional permit within thirty days of the receipt of a completed application and exhibits and payment of the fee by the applicant if the applicant has submitted an application containing the information required in section 20-1802, subsection B, paragraphs 1 through 15. Under the provisional permit, the applicant may solicit reservations for residences in the facility and reservations for the provision of services in private residences and collect deposits therefor. The applicant shall establish a trust account in which all reservation deposits shall be placed. The person entering into the contract for a reservation may rescind the agreement at any time prior to entering into the life care contract. In the event the reservation agreement is rescinded, all money or property, including accrued interest thereon, shall be returned to the person.
A.R.S. § 20-488.02 — Arizona Code / Title 20 / Chapter 2 / Article 12 / Section 488.02
20-488.02 Company action level event
Status: in_force

20-488.02. Company action level event

A. If a company action level event occurs, the insurer shall prepare and submit to the director an RBC plan.  The plan shall:

1. Identify the conditions in the insurer that contribute to the company action level event.

2. Propose corrective actions that the insurer intends to take and that are expected to result in the elimination of the company action level event.

3. Provide projections of the insurer's financial results in the current year and at least the four succeeding years.  The projections shall be based on both the absence of corrective actions and the proposed corrective actions, including projections of statutory operating income, net income, capital or surplus.  The projections for both new and renewal business may include separate projections for each major line of business and may separately identify each significant income, expense and benefit component.

4. Identify the key assumptions impacting the insurer's projections and the sensitivity of the projections to the assumptions.

5. Identify the quality of and problems associated with the insurer's business, including but not limited to its assets, anticipated business growth and associated surplus strain, extraordinary exposure to risk, mix of business and use of reinsurance in each case, if any.

B. The RBC plan shall be submitted within:

1. Forty-five days after the company action level event occurs.

2. If the insurer challenges an adjusted RBC report pursuant to section 20-488.06, forty-five days after the insurer is notified that the director, after a hearing, has rejected the insurer's challenge.

C. Within sixty days after the insurer submits an RBC plan to the director, the director shall notify the insurer that the RBC plan will be implemented or, in the director's judgment, is unsatisfactory.  If the director determines that the RBC plan is unsatisfactory, the notice to the insurer shall set forth the reasons for the director's determination and may set forth proposed revisions that would render the plan satisfactory in the judgment of the director.  On receipt of notice from the director, the insurer shall prepare a revised RBC plan.  The revised RBC plan may incorporate by reference any revisions proposed by the director.  The insurer shall submit the revised RBC plan to the director within:

1. Forty-five days after receiving notice from the director.

2. If the insurer challenges the notice from the director pursuant to section 20-488.06, forty-five days after the insurer is notified that the director, after a hearing, has rejected the insurer's challenge.

D. If the director notifies the insurer that the insurer's RBC plan or revised RBC plan is unsatisfactory, subject to the insurer's right to a hearing pursuant to section 20-488.06 the director may specify in the notice that the notice constitutes a regulatory action level event.

E. Each domestic insurer that files an RBC plan or a revised RBC plan with the director shall file a copy of the plan with the insurance director in any state in which the insurer is authorized to transact business if both:

1. That state has an RBC provision substantially similar to section 20-488.07, subsection A.

2. The insurance director in that state notifies the insurer in writing of its request for the filing.  After receiving notice of the request, the insurer shall file a copy of the RBC plan or revised RBC plan in that state no later than fifteen days after the receipt of the notice or the date on which the RBC plan or revised RBC plan is filed pursuant to subsection B or C of this section, whichever is later.
A.R.S. § 20-2502 — Arizona Code / Title 20 / Chapter 15 / Article 1 / Section 2502
20-2502 Utilization review activities; exemptions
Status: in_force

20-2502. Utilization review activities; exemptions

A. A utilization review agent shall not conduct utilization review in this state unless the utilization review agent meets or is exempt from this article.

B. A person is exempt from sections 20-2504, 20-2505, 20-2506, 20-2507 and 20-2508 and section 20-2509, subsection A if the person:

1. Is accredited by the utilization review accreditation commission, the national committee for quality assurance or any other nationally recognized accreditation process recognized by the director.

2. Conducts internal utilization review for hospitals, home health agencies, clinics, private offices or other health facilities or entities if the review does not result in the approval or denial of payment for hospital or medical services.

3. Conducts utilization review activities exclusively for work related injuries and illnesses covered under the workers' compensation laws in title 23.

4. Conducts utilization review activities exclusively for a self-funded or self-insured employee benefit plan if the regulation of that plan is preempted by section 514(b) of the employee retirement income security act of 1974 (29 United States Code section 1144(b)).

C. A utilization review agent shall conduct utilization review in accordance with the agent's utilization review plan that is on file with the department pursuant to section 20-2505 and in accordance with section 20-2532.
A.R.S. § 20-1135 — Arizona Code / Title 20 / Chapter 5 / Article 1 / Section 1135
20-1135 Prohibition against excluding coverage because of previous tests for a condition
Status: in_force

20-1135. Prohibition against excluding coverage because of previous tests for a condition

An insurance contract offered by an insurer pursuant to this chapter shall not exclude coverage of a condition if the insured person has previously had tests for the condition and the condition was not found to exist. There must be evidence that a condition actually existed before the insurance contract was entered into in order to exclude coverage of the condition.
A.R.S. § 20-163 — Arizona Code / Title 20 / Chapter 1 / Article 2 / Section 163
20-163 Notice of hearing
Status: in_force

20-163. Notice of hearing

Not less than ten days in advance the director shall give notice of the time and place of the hearing, stating the matters to be considered. If the persons to be given notice are not specified in the provision pursuant to which the hearing is held, the director shall give such notice to all persons directly affected by such hearing.
A.R.S. § 20-1656 — Arizona Code / Title 20 / Chapter 6 / Article 12 / Section 1656
20-1656 Proof of sending as proof of notice
Status: in_force

20-1656. Proof of sending as proof of notice

A. Proof of sending a notice of cancellation and the reasons for cancellation or of intention not to renew to the named insured by mail at the address shown in the policy is sufficient proof of the notice required by this article.

B. Any method of proof retained by the insurer for sending a notice of cancellation by any method other than by mail is sufficient proof of the notice required by this article.
A.R.S. § 20-1209 — Arizona Code / Title 20 / Chapter 6 / Article 1 / Section 1209
20-1209 Policy loan on new policies
Status: in_force

20-1209. Policy loan on new policies

A. In case of policies issued on and after January 1, 1979, there shall be a provision that after the policy has a cash surrender value and while no premium is in default beyond the grace period for payment, the insurer will advance, on proper assignment or pledge of the policy and on the sole security of such policy, at a specified rate of interest, an amount equal to or, at the option of the party entitled thereto, less than the loan value of the policy. The loan value of the policy shall be at least equal to the cash surrender value at the end of the then current policy year, provided that the insurer may deduct, either from the loan value or from the proceeds of the loan, any existing indebtedness not already deducted in determining the cash surrender value including any interest then accrued but not due, any unpaid balance of the premium for the current policy year and interest on the loan to the end of the current policy year. The policy may also provide that if interest on any indebtedness is not paid when due it shall then be added to the existing indebtedness and shall bear interest at the same rate, and that if and when the total indebtedness on the policy, including interest due or accrued, equals or exceeds the amount of the loan value the policy shall terminate and become void. The policy shall reserve to the insurer the right to defer the granting of a loan, other than for the payment of any premium to the insurer, for six months after application. The policy, at the insurer's option, may provide for an automatic premium loan, subject to an election of the party entitled to elect.

B. This section shall not apply to term policies nor to term insurance benefits provided by rider or supplemented policy provision.
A.R.S. § 20-1103 — Arizona Code / Title 20 / Chapter 5 / Article 1 / Section 1103
20-1103 "Premium" defined
Status: in_force

20-1103. "Premium" defined

"Premium" is the consideration for insurance, by whatever name called.
A.R.S. § 20-841.11 — Arizona Code / Title 20 / Chapter 4 / Article 3 / Section 841.11
20-841.11 Prescription eyedrops; refills
Status: in_force

20-841.11. Prescription eyedrops; refills

A. Beginning January 1, 2018, any contract that is issued, delivered or renewed by a corporation and that provides coverage for prescription eyedrops to treat glaucoma or ocular hypertension may not deny coverage for a refill of a prescription for eyedrops to treat glaucoma or ocular hypertension if all of the following apply:

1. The subscriber requests the refill:

(a) For a thirty-day supply, at least twenty-three days and less than thirty days from the later of:

(i) The original date that the prescription was distributed to the subscriber.

(ii) The date of the most recent refill that was distributed to the subscriber.

(b) For a sixty-day supply, at least forty-five days and less than sixty days from the later of:

(i) The original date that the prescription was distributed to the subscriber.

(ii) The date of the most recent refill that was distributed to the subscriber.

(c) For a ninety-day supply, at least sixty-eight days and less than ninety days from the later of:

(i) The original date that the prescription was distributed to the subscriber.

(ii) The date of the most recent refill that was distributed to the subscriber.

2. The prescription eyedrops to treat glaucoma or ocular hypertension prescribed by the health care provider are a covered benefit under the subscriber's contract.

3. The prescribing health care provider indicates on the original prescription that additional quantities of the prescription eyedrops to treat glaucoma or ocular hypertension are needed.

4. The refill requested by the subscriber does not exceed the number of additional quantities prescribed.

B. To the extent practicable, the requirements of this section are limited in quantity to the remaining dosage initially approved for coverage, except that any limited refilling may not limit or restrict coverage to any previously or subsequently approved prescription eyedrops to treat glaucoma or ocular hypertension and is subject to the terms and conditions of the contract that are applicable to this coverage.
A.R.S. § 20-473 — Arizona Code / Title 20 / Chapter 2 / Article 7 / Section 473
20-473 Obligation of mortgagee to furnish mortgagor copies of insurance policy
Status: in_force

20-473. Obligation of mortgagee to furnish mortgagor copies of insurance policy

Whenever the mortgagee or a person acting for the mortgagee, by the terms of the mortgage agreement retains possession of the original policy of insurance insuring collateral security for a mortgage, and the mortgagee or his agent has procured the issuance of the insurance, then such mortgagee or his agent shall furnish the borrower, mortgagor or purchaser with a copy of the insurance policy.
A.R.S. § 20-561 — Arizona Code / Title 20 / Chapter 3 / Article 2 / Section 561
20-561 Collateral loans
Status: in_force

20-561. Collateral loans

A. An insurer may lend its funds in negotiable promissory notes on the pledge of any investment that qualifies under this article, other than real property.  The insurer shall not make a loan that is more than seventy-five per cent of the market value of the collateral pledged.  The loan documents shall provide that all of the rights and remedies of a secured party provided by the law governing secured transactions in the jurisdiction of the loan are available to the insurer, except that a borrower shall not have more than twenty days to correct a default after the secured party has given notice of default in writing to the borrower.

B. The amount loaned is an admitted asset to the extent that the amount loaned plus the insurer's investments that are like those pledged are not more than the applicable investment limitation or the limitation on the percentage of assets invested with a single person prescribed by this article.

C. Sections 20-553, 20-554, 20-556 and 20-557 apply to loans that are secured by real estate.
A.R.S. § 20-2106 — Arizona Code / Title 20 / Chapter 11 / Article 1 / Section 2106
20-2106 Content of disclosure authorization forms
Status: in_force

20-2106. Content of disclosure authorization forms

Notwithstanding any other statute no insurance institution, insurance producer or insurance support organization may utilize as its disclosure authorization form in connection with insurance transactions a form or statement which authorizes the disclosure of personal or privileged information about an individual to the insurance institution, insurance producer or insurance support organization unless the form or statement:

1. Is written in plain language.

2. Is dated.

3. Specifies the types of persons authorized to disclose information about the individual.

4. Specifies the nature of the information authorized to be disclosed.

5. Names the insurance institution or insurance producer and identifies by generic reference representatives of the insurance institution to whom the individual is authorizing information to be disclosed.

6. Specifies the purposes for which the information is collected.

7. In the case of authorizations signed for the purpose of collecting information in connection with an application for an insurance policy, a policy reinstatement or a request for change in policy benefits, specifies the length of time the authorization remains valid. The length of time shall be no longer than:

(a) Thirty months from the date the authorization is signed if the application or request involves life, health or disability insurance.

(b) One year from the date the authorization is signed if the application or request involves property or casualty insurance.

8. In the case of authorizations signed for the purpose of collecting information in connection with a claim for benefits under an insurance policy, specifies the length of time the authorization remains valid. The length of time shall be no longer than:

(a) The term of coverage of the policy if the claim is for a health insurance benefit.

(b) The duration of the claim if the claim is not for a health insurance benefit.

9. Advises the individual or a person authorized to act on behalf of the individual that the individual or the individual's authorized representative is entitled to receive a copy of the authorization form.
A.R.S. § 20-2662 — Arizona Code / Title 20 / Chapter 16 / Article 3 / Section 2662
20-2662 Insurance producer qualifications; reports
Status: in_force

20-2662. Insurance producer qualifications; reports

A. A person may not sell or offer for sale in this state any variable contracts unless the person is licensed as a life insurance producer by the department and files with the director evidence that the person is licensed by the financial industry regulatory authority as a principal or a registered representative and that the person is authorized to solicit or sell variable contracts by an insurer admitted to transact variable contract business in this state.

B. A person may not sell or offer for sale in this state any variable group contracts unless the person is licensed as a life insurance producer by the department and is authorized to solicit or sell variable group contracts by an insurer who is admitted to transact variable group contract business in this state.

C. Any examination that is administered by the department to determine if a person is eligible for licensing as an insurance producer may include any questions that the director deems appropriate and that concern the history, purpose, regulation and sale of variable contracts or variable group contracts.

D. Any person who is qualified to sell or offer to sell variable contracts or variable group contracts under this article shall immediately report to the director:

1. The suspension or revocation of the insurance producer's license in any other state or territory of the United States.

2. The imposition of any disciplinary sanction, including the suspension or expulsion of the insurance producer from membership, or suspension, revocation or denial of the  insurance producer's registration by any national securities exchange, national securities association or federal, state or territorial agency that has jurisdiction over securities or variable contracts.

3. The entry of a judgment or injunction against the insurance producer for conduct involving fraud, deceit or misrepresentation or a violation of any insurance or securities law.

E. The director may reject an application or suspend, revoke or refuse to renew an insurance producer's qualification to sell or offer to sell variable contracts on any ground that would bar the applicant or insurance producer from being licensed to sell other life insurance contracts in this state.  The rules that apply to a proceeding relating to the suspension or revocation of an insurance producer's license also apply to a proceeding for the suspension or revocation of an insurance producer's qualification to sell or offer to sell variable contracts.
A.R.S. § 20-2407 — Arizona Code / Title 20 / Chapter 14 / Article 1 / Section 2407
20-2407 Notice and registration requirements of purchasing groups
Status: in_force

20-2407. Notice and registration requirements of purchasing groups

A. A purchasing group which intends to do business in this state, before doing business, shall furnish notice to the director which:

1. Identifies the state in which the group is domiciled.

2. Specifies the lines and classifications of liability insurance which the purchasing group intends to purchase.

3. Specify the method by which, and the person or persons, if any, through whom, insurance will be offered to its members whose risks are resident or located in this state.

4. Identifies the principal place of business of the group.

5. Provides other information as may be required by the director to verify that the purchasing group meets the criteria under section 20-2401, paragraph 9.

B. The purchasing group shall register with and designate the director as its agent solely for the purpose of receiving service of legal documents of process. The director shall determine the filing fee. This requirement does not apply in the case of a purchasing group:

1. Which in any state both:

(a) Was domiciled before April 1, 1986.

(b) Is domiciled on October 27, 1986 in any state.

2. Which both:

(a) Before October 27, 1986 purchased insurance from an insurance carrier licensed in any state.

(b) Since October 27, 1986 purchased its insurance from an insurance carrier licensed in any state.

3. Which was a purchasing group under the requirements of the product liability risk retention act of 1981 (15 United States Code section 3901) before October 27, 1986.

4. Which does not purchase insurance that was not authorized for purposes of an exemption under the product liability risk retention act of 1981 (15 United States Code section 3901), in effect before October 27, 1986.

C. Any purchasing group which was doing business in this state before the effective date of this chapter, within thirty days after the effective date of this chapter, shall furnish notice to the director pursuant to subsection A and furnish information required pursuant to subsection B.
A.R.S. § 20-119 — Arizona Code / Title 20 / Chapter 1 / Article 1 / Section 119
20-119 Charitable gift annuities; audited financial statements; disclosure statement; commissions prohibited; definitions
Status: in_force

20-119. Charitable gift annuities; audited financial statements; disclosure statement; commissions prohibited; definitions

A. On the day a charitable organization enters into an agreement for a charitable gift annuity, the charitable organization shall have:

1. A minimum of three hundred thousand dollars in unrestricted cash, cash equivalents or publicly traded securities, exclusive of assets funding the charitable gift annuity agreement.

2. Been in continuous operation for at least three years or is a successor or affiliate of a charitable organization that has been in continuous operation for at least three years.

3. Had an annual audit of its operations conducted by an independent certified public accountant for the past two fiscal years.

B. Any person offering a charitable gift annuity in this state shall provide the following information in writing to a prospective donor before entering into an agreement for a charitable gift annuity or receiving any transfer of cash or property from the donor:

1. The name and address of the charitable organization offering the charitable gift annuity to the donor.

2. A description of the charitable organization offering the charitable gift annuity, including its state of organization, its date of organization and its current operations.

3. A statement that the charitable organization will make additional financial information, including its most current audited and interim financial statements, available to the donor on request.  This statement shall be conspicuous and printed in at least ten point bold-faced type.

4. A disclosure that the charitable gift annuity is not insurance under the laws of this state, is not subject to regulation by the director and is not protected by any state guaranty fund.

5. A disclosure that this state and the department have not approved or disapproved of the charitable gift annuity being offered and have not determined whether any of the information provided to the donor is truthful or complete.

C. If any agreement between a charitable organization and a donor for a charitable gift annuity is entered in violation of this section, the donor may bring an action in a court of competent jurisdiction to recover the amount of the consideration paid for the charitable gift annuity, with interest, taxable court costs and reasonable attorney fees, less the amount of any income received from ownership of the charitable gift annuity, on tender of the charitable gift annuity or the agreement for it.  Any such action shall be brought within two years of the date the donor discovered or reasonably should have discovered that the charitable gift annuity transaction did not comply with this section.

D. In connection with the solicitation or negotiation of a charitable gift annuity, a person shall not directly or indirectly pay or accept a commission, fee or other form of compensation contingent on the donation or amount of the charitable gift annuity.  This subsection does not prohibit or restrict a charitable organization from paying the regular compensation owed to its employees or the distribution of monies for authorized charitable purposes.

E. For the purposes of this section:

1. "Charitable gift annuity" means a transfer of cash or other property by a donor to a charitable organization in return for an annuity that is payable over one or two lives under which the actuarial value of the annuity is less than the value of the cash or other property transferred and the difference in value is a charitable deduction for federal tax purposes.

2. "Charitable organization" means an entity that is described in section 501(c)(3) or 170(c) of the internal revenue code of 1986.
A.R.S. § 20-486 — Arizona Code / Title 20 / Chapter 2 / Article 10 / Section 486
20-486 Definitions; director's list
Status: in_force

20-486. Definitions; director's list

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

1. "Actuary" means a person who is a member in good standing of the American academy of actuaries.

2. "Controlling person" means a person, firm, association or corporation that directly or indirectly has the power to direct or cause to be directed the management, control or activities of the reinsurance intermediary.

3. "Insurer" means a person, firm, association or corporation licensed to transact insurance business in this state.

4. "Licensed producer" means an insurance producer or reinsurance intermediary who is licensed pursuant to this title.

5. "Reinsurance intermediary" means a reinsurance intermediary broker or a reinsurance intermediary manager.

6. "Reinsurance intermediary broker" means a person, other than an officer or employee of the ceding insurer, or a firm, association or corporation that solicits, negotiates or places reinsurance cessions or retrocessions on behalf of a ceding insurer without the authority or power to bind reinsurance on behalf of the insurer.

7. "Reinsurance intermediary manager" means a person, firm, association or corporation that has authority to bind or manage all or part of the assumed reinsurance business of a reinsurer, including the management of a separate division, department or underwriting office, and that acts as an agent for the reinsurer whether the reinsurer is known as a reinsurance intermediary manager, a manager or another similar term. For the purposes of this article, the following persons are not reinsurance intermediary managers:

(a) An employee of the reinsurer.

(b) The United States manager of a United States branch of an alien reinsurer.

(c) An underwriting manager who, pursuant to contract, manages all of the reinsurance operations of the reinsurer, who is under common control with the reinsurer, subject to the holding company regulatory act, and whose compensation is not based on the volume of premiums written.

(d) The manager of a group, association, pool or organization of insurers that engages in joint underwriting or joint reinsurance and that is subject to examination by the insurance director of the state in which the manager's principal business office is located.

8. "Reinsurer" means a person, firm, association or corporation licensed to transact reinsurance business in this state.

9. "Violation" means the failure of the reinsurance intermediary, insurer or reinsurer for whom the reinsurance intermediary was acting to substantially comply with the provisions of this article.

B. The director may establish and maintain a list of financial institutions as a qualified financial institution if the institution is:

1. Organized, or in the case of a United States office of a foreign banking organization, licensed, under the laws of the United States or any state of the United States.

2. Regulated, supervised and examined by federal or state authorities having regulatory authority over banks and trust companies.

3. Determined by the director to meet the standards of financial condition and standing that are considered necessary and appropriate to regulate the quality of financial institutions whose letters of credit will be acceptable to the director.
A.R.S. § 20-408 — Arizona Code / Title 20 / Chapter 2 / Article 5 / Section 408
20-408 Report of broker; civil penalty
Status: in_force

20-408. Report of broker; civil penalty

A. A broker procuring surplus lines insurance on behalf of an insured whose home state is Arizona shall file with the director on or before the date specified in section 20-415, subsection B a verified report setting forth facts from which it may be determined whether the requirements of section 20-407 have been met. The report shall also contain or be accompanied by the following:

1. The name of the insurer and the identification number assigned to it by the national association of insurance commissioners.

2. The number of the policy issued.

3. The name and the city, state and zip code of the insured.

4. The premium, including taxable policy fees.

5. The identity of the specific surplus lines coverage written.

6. The policy effective dates that shall not be open to public inspection.

B. The director shall prescribe the required report form.

C. The director may direct a broker to file the broker's report required by this section with a voluntary domestic organization of surplus lines brokers with which the director has contracted to accept reports pursuant to section 20-167.

D. A broker may collect from the insured the stamping fee prescribed in section 20-167.

E. The director may impose and collect a civil penalty of not more than $25 against a broker for each day the report prescribed in subsection A of this section is late.

F. In addition to the requirements of subsection A, paragraph 5 of this section, if the insurance coverage is not a recognized surplus line pursuant to section 20-409, a surplus lines broker shall maintain evidence of compliance with the requirements of section 20-407, subsection A for the duration of the insurance policy and for a period of six years after the expiration of the policy.
A.R.S. § 20-1693 — Arizona Code / Title 20 / Chapter 6 / Article 17 / Section 1693
20-1693 Definitions
Status: in_force

20-1693. Definitions

In this article, unless the context otherwise requires:

1. "Customer" means a person who purchases portable electronics or services.

2. "Enrolled customer" means a customer who elects coverage under a portable electronics insurance policy issued to a vendor of portable electronics.

3. "Location" means any physical location in this state or any website, call center site or similar location directed to residents of this state.

4. "Portable electronics" means personal, self-contained, easily carried by an individual, battery-operated electronic communication, viewing, listening, recording, gaming, computing or global positioning devices, including cell or satellite phones, pagers, personal global positioning satellite units, portable computers, portable audio listening devices, video viewing or recording devices, digital cameras, video camcorders, portable gaming systems, docking stations, automatic answering devices and other similar devices and the devices' accessories.

5. "Portable electronics insurance":

(a) Means insurance providing coverage for the repair or replacement of portable electronics that may provide coverage for portable electronics against loss, theft or inoperability, or any combination thereof, due to mechanical failure, malfunction, damage or other similar causes of loss.

(b) Does not include:

(i) A service contract under chapter 4, article 11 of this title.

(ii) An insurance policy covering a seller's or manufacturer's obligations under a warranty.

(iii) A homeowner's, renter's, private passenger automobile, commercial multiperil or similar policy.

6. "Portable electronics transaction" means either:

(a) The sale or lease of portable electronics by a vendor to a customer.

(b) The sale of a service related to the use of portable electronics by a vendor to a customer.

7. "Supervising entity" means a business entity that is a licensed insurer or insurance producer and that is authorized by an insurer to supervise the administration of a portable electronics insurance policy.

8. "Vendor" means a business in the business of engaging in portable electronics transactions directly or indirectly.
A.R.S. § 20-861 — Arizona Code / Title 20 / Chapter 4 / Article 4 / Section 861
20-861 Definitions
Status: in_force

20-861. Definitions

In this article, unless the context otherwise requires:

1. "Association or order" means any association or order that is a nonprofit military mutual aid association, whose members are officers or enlisted, regular or reserve, active, retired or honorably discharged members of the armed forces or sea services of the United States, and whose principal purpose is to provide life insurance and annuities to its members and their dependents or beneficiaries.

2. "Benefit contract" means an agreement for the provision of benefits.

3. "Benefit member" means an adult who is a member of a fraternal benefit society and who is designated by the laws or rules of the society to be a benefit member under a benefit contract.

4. "Certificate" means a document that is issued as written evidence of the benefit contract.

5. "Fraternal benefit society" means a society, order or supreme lodge without capital stock, including an incorporated or unincorporated society that is exempt under section 20-893, that is conducted solely for the benefit of its members and their beneficiaries, is not for profit, operates on a lodge system with a ritualistic form of work, has a representative form of government and provides benefits according to this article.

6. "Laws" means the articles of incorporation, constitution and bylaws of the society.

7. "Lodge" means a subordinate member of the society, including any camp, court, council, branch or other designated unit.

8. "Premiums" means rates, dues or other required contributions that are payable under the certificate.

9. "Rules" means the rules, regulations and resolutions that are adopted by the supreme governing body or board of directors and that are intended to apply to the members of the society.

10. "Society" means a fraternal benefit society.
A.R.S. § 20-204 — Arizona Code / Title 20 / Chapter 2 / Article 1 / Section 204
20-204 "Foreign" insurer defined
Status: in_force

20-204. "Foreign" insurer defined

A "foreign" insurer is one formed under the laws of another state of the United States.
A.R.S. § 20-1241.06 — Arizona Code / Title 20 / Chapter 6 / Article 1.1 / Section 1241.06
20-1241.06 Duties of existing insurer
Status: in_force

20-1241.06. Duties of existing insurer

A. An existing insurer shall comply with the following requirements for any replacement transaction:

1. The insurer shall retain and be able to provide the director with all notifications received, indexed by replacing insurer, for at least five years or until the conclusion of its next examination by the insurance regulatory authority of its state of domicile, whichever is later.

2. Within five business days of receiving a replacement notice, the insurer shall send the policy or contract owner a letter advising the owner of the right to receive information about the existing policy or contract values including, if available, an in-force illustration or a policy summary if an in-force illustration cannot be produced.  The insurer shall provide the policy or contract owner with this information within five business days of the receipt of a request from the policy or contract owner.

3. On receipt of a request to borrow, surrender or withdraw any policy values, the insurer shall send a notice advising the policy owner that a release of policy values may affect the guaranteed elements, nonguaranteed elements, face amount or surrender value of the policy from which the values are released.

B. The insurer shall send the notice required by subsection A, paragraph 3 separate from the check if the check is sent to anyone other than the policy owner.  In the case of consecutive automatic premium loans, the insurer shall send the notice only at the time of the first loan.
A.R.S. § 20-452.02 — Arizona Code / Title 20 / Chapter 2 / Article 6 / Section 452.02
20-452.02 Exceptions
Status: in_force

20-452.02. Exceptions

Section 20-452.01 shall not prevent:

1. The exercise by any person engaged in such business of his right to approve or disapprove of the insurer selected to underwrite the insurance, nor of his right to furnish such insurance or to renew any insurance required by the contract of sale or trust deed or other loan agreement if the borrower or purchaser shall have failed to furnish the insurance or renewal thereof within such reasonable time or form as may be specified in the sale or loan agreement.

2. Any lender from recommending to any borrower or prospective borrower the placing of insurance with a specified insurer, or through a specified insurer or person transacting insurance, as long as such recommendation does not violate the provisions of section 20-452.01.

3. The free choice of insurer or person transacting insurance by any borrower or purchaser at any time, and he may revoke any designation of insurer or person transacting insurance at any time, irrespective of the provisions of any loan or purchase agreement or trust deed.
A.R.S. § 20-723 — Arizona Code / Title 20 / Chapter 4 / Article 1 / Section 723
20-723 Dividends to mutual policyholders
Status: in_force

20-723. Dividends to mutual policyholders

A. The directors of a domestic mutual insurer may from time to time apportion and pay or credit to its members dividends only from that part of its surplus funds which represents net realized savings and net realized earnings from its business.

B. A dividend otherwise proper may be payable from such savings and earnings even though the insurer's total surplus is then less than the aggregate of its contributed surplus.
A.R.S. § 20-1810 — Arizona Code / Title 20 / Chapter 8 / Article 1 / Section 1810
20-1810 Rules and regulations
Status: in_force

20-1810. Rules and regulations

The director may promulgate reasonable rules and regulations for effectuating any provision of this chapter.
A.R.S. § 20-1242.03 — Arizona Code / Title 20 / Chapter 6 / Article 1.2 / Section 1242.03
20-1242.03 Report to contract owners
Status: in_force

20-1242.03. Report to contract owners

For annuities in the payout period with changes in nonguaranteed elements and for the accumulation period of a deferred annuity, the insurer shall provide each contract owner with a report, at least annually, on the status of the contract that contains at least the following information:

1. The beginning and end date of the current report period.

2. The accumulation and cash surrender value, if any, at the end of the previous report period and at the end of the current report period.

3. The total amounts, if any, that have been credited, charged to the contract value or paid during the current report period.

4. The amount of outstanding loans, if any, as of the end of the current report period.
A.R.S. § 20-545 — Arizona Code / Title 20 / Chapter 3 / Article 2 / Section 545
20-545 Preferred, guaranteed or preference stock
Status: in_force

20-545. Preferred, guaranteed or preference stock

An insurer may invest in preferred, guaranteed or preference stocks or shares of any solvent institution created or existing under the laws of the United States or of any state, district or territory of the United States if those preferred, preference or guaranteed stocks or shares have received an investment grade rating as approved by the director. The director shall by order after a hearing prescribe the investment grade ratings and the recognized rating agencies for the purposes of this section. Preferred, guaranteed or preference stocks which have not received an investment grade rating may be eligible for investment if the issuer has issued comparable preferred, guaranteed or preference stocks which have received an investment grade rating approved by the director. The director shall prescribe standards by order after a hearing by which preferred, guaranteed or preference stocks which have not received an investment grade rating may be eligible for investment.
A.R.S. § 20-1742 — Arizona Code / Title 20 / Chapter 7 / Article 4 / Section 1742
20-1742 Insurers to report malpractice claims and actions; definition
Status: in_force

20-1742. Insurers to report malpractice claims and actions; definition

A. Each health care insurer providing professional liability insurance to a health professional as defined in section 32-3201 shall report to the appropriate health profession regulatory board, except the Arizona medical board, within thirty days of its receipt, any written or oral claim or action for damages for personal injury claimed to have been caused by:

1. An error, omission or negligence in the performance of an insured's professional services.

2. The performance of professional services without adequate informed consent.

3. An alleged breach of contract for professional services.

B. The reports required by subsection A of this section shall be confidential, nondiscoverable and nonadmissible as evidence, shall be filed on such forms as the health profession regulatory board, except the Arizona medical board, may require and shall contain:

1. The name and address of the health professional involved in the claim.

2. The name and address of the person on whose behalf the claim is being filed.

3. The date of the occurrence that created the claim.

4. The date of the claim if a complaint is not simultaneously filed.

5. The date the complaint is filed, if applicable.

6. A summary of the occurrence on which the claim is based as stated by the claimant.

7. Such other reasonable information related to the claim as the director may require.

C. Every health care insurer required to report to the health profession regulatory board pursuant to this section is required to advise the health profession regulatory board of any settlements or judgments entered against a health professional as defined in section 32-3201 within thirty days after the settlement was agreed to or the judgment was entered in superior court.

D. There shall be no liability on the part of and no cause of action shall arise against any health care insurer or its agents or employees reporting as required by this section.

E. The health profession regulatory board shall notify each health care insurer that is required to report pursuant to subsection A of this section of its duty to report.

F. This section does not limit the director of the department of insurance and financial institutions from obtaining any of the information required to be reported under this section.

G. For the purposes of this section, "health profession regulatory board" means an agency, board or commission that licenses, certifies or registers a health professional as defined by section 32-3201.
A.R.S. § 20-1544 — Arizona Code / Title 20 / Chapter 6 / Article 8.1 / Section 1544
20-1544 Limitation on advertising
Status: in_force

20-1544. Limitation on advertising

A mortgage guaranty insurance company or any agent or representative of a mortgage guaranty insurance company shall not prepare or distribute or assist in preparing or distributing any brochure, pamphlet, report or any form of advertising to the effect that the real estate investments of any financial institution are "insured investments", unless the brochure, pamphlet, report or advertising clearly states that the loans are insured by mortgage guaranty insurance companies possessing a certificate of authority to transact mortgage guaranty insurance in this state or are insured by an agency of the federal government.
A.R.S. § 20-2510 — Arizona Code / Title 20 / Chapter 15 / Article 1 / Section 2510
20-2510 Health care insurers requirements; medical directors
Status: in_force

20-2510. Health care insurers requirements; medical directors

A. A health care insurer that proposes to provide coverage of inpatient hospital and medical benefits, outpatient surgical benefits or any medical, surgical or health care service for residents of this state with utilization review of those benefits shall meet at least one of the following requirements:

1. Have a certificate issued pursuant to this chapter.

2. Be accredited by the utilization review accreditation commission, the national committee for quality assurance or any other nationally recognized accreditation process recognized by the director.

3. Contract with a utilization review agent that has a certificate issued pursuant to this chapter.

4. Contract with a utilization review agent that is accredited by the utilization review accreditation commission, the national committee for quality assurance or any other nationally recognized accreditation process recognized by the director.

5. Provide to the director a signed and notarized statement that the health care insurer has submitted an application for accreditation to the utilization review accreditation commission or the national committee for quality assurance and is awaiting completion of the accreditation review process. On completion of the accreditation review process, the insurer shall provide to the director adequate proof that the insurer has been accredited. If the insurer is denied accreditation, within sixty days after the denial the insurer shall meet at least one of the requirements set forth in paragraph 1, 2, 3 or 4 of this subsection.

B. Except as provided in subsections C, D and E of this section, any direct denial of prior authorization of a service requested by a health care provider on the basis of medical necessity by a health care insurer shall be made in writing by a medical director who holds an active unrestricted license to practice medicine in this state pursuant to title 32, chapter 13 or 17.  The written denial shall include an explanation of why the treatment was denied. The health care insurer shall send a copy of the written denial to the health care provider who requested the treatment.  Health care insurers shall maintain copies of all written denials and shall make the copies available to the department for inspection during regular business hours. The medical director is responsible for all direct denials that are made on the basis of medical necessity. Nothing in this section prohibits a health care insurer from consulting with a licensed physician whose scope of practice may provide the health care insurer with a more thorough review of the medical necessity.

C. For determinations made pursuant to subsection B of this section, a dental service corporation as defined in section 20-822 or a prepaid dental plan organization as defined in section 20-1001 may use as a medical director either:

1. An individual who holds an active unrestricted license to practice dentistry in this state pursuant to title 32, chapter 11.

2. A physician who holds an active unrestricted license to practice medicine in this state pursuant to title 32, chapter 13 or 17.

D. For determinations made pursuant to subsection B of this section, an optometric service corporation may use as a medical director either:

1. An individual who holds an active unrestricted license to practice optometry in this state pursuant to title 32, chapter 16.

2. A physician who holds an active unrestricted license to practice medicine in this state pursuant to title 32, chapter 13 or 17.

E. For determinations made pursuant to subsection B of this section, a health care insurer shall use a chiropractor licensed in this state pursuant to title 32, chapter 8 or by any regulatory board in another state to review any direct denial of prior authorization of a chiropractic service requested by a chiropractor on the basis of medical necessity.
A.R.S. § 20-2341 — Arizona Code / Title 20 / Chapter 13 / Article 2 / Section 2341
20-2341 Uninsured small business health insurance plans; mandatory coverage exemption; definitions
Status: in_force

20-2341. Uninsured small business health insurance plans; mandatory coverage exemption; definitions

A. A policy, subscription contract, contract, plan or evidence of coverage issued to an uninsured small business by a health care insurer 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, subsection C, paragraph 1.

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

4. Sections 20-841, 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.

6. Section 20-1057, subsections C, K, L, Y, Z, AA and BB.

7. Sections 20-1057.01, 20-1057.03, 20-1057.04, 20-1057.05 and 20-1057.08.

8. Section 20-1057.02, subsection B.

9. Section 20-1342, subsection A, paragraph 8, subdivision (a).

10. Section 20-1342, subsection A, paragraphs 11 and 12.

11. Section 20-1342, subsections H, I, J and K.

12. Section 20-1342.01.

13. Sections 20-1376, 20-1376.01, 20-1376.02, 20-1376.03 and 20-1376.04.

14. Section 20-1402, subsection A, paragraph 4, subdivision (a).

15. Section 20-1402, subsection A, paragraphs 7 and 8.

16. Section 20-1402, subsections H, I, J, K and L.

17. Section 20-1404, subsection F, paragraph 1.

18. Section 20-1404, subsections I, Q, R, S, T and U.

19. Section 20-1406.

20. Sections 20-1406.01, 20-1406.02, 20-1406.03 and 20-1406.04.

21. Section 20-1407.

22. Section 20-2321.

23. Section 20-2327.

24. Section 20-2329.

B. Section 20-2304, subsection B does not apply to a policy, subscription contract, contract, plan or evidence of coverage issued to an uninsured small business pursuant to subsection A of this section.

C. In this article, unless the context otherwise requires:

1. "Health care 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.

2. "Uninsured small business" means a small employer that did not provide a health benefits plan for at least ninety days immediately before the effective date of coverage provided pursuant to this section, except that this requirement does not apply at the renewal of coverage pursuant to this section.
A.R.S. § 20-1904 — Arizona Code / Title 20 / Chapter 9 / Article 1 / Section 1904
20-1904 Confidentiality of information
Status: in_force

20-1904. Confidentiality of information

An authorized agency who receives information pursuant to this chapter shall hold the information in confidence until such time as its release is required pursuant to this chapter or pursuant to a criminal or civil proceeding.
A.R.S. § 20-442 — Arizona Code / Title 20 / Chapter 2 / Article 6 / Section 442
20-442 Unfair trade practices prohibited
Status: in_force

20-442. Unfair trade practices prohibited

No person shall engage in this state in any trade practice which is prohibited by this article, or defined in this article as, or determined pursuant to this article to be, an unfair method of competition or an unfair or deceptive act or practice in the business of insurance.
A.R.S. § 20-3405 — Arizona Code / Title 20 / Chapter 26 / Article 1 / Section 3405
20-3405 Prior authorization of prescription drugs for chronic pain conditions
Status: in_force

20-3405. Prior authorization of prescription drugs for chronic pain conditions

A. For a prior authorization request related to a chronic pain condition, the health care services plan or its utilization review agent shall honor a prior authorization that is granted for an approved prescription drug for the earliest of the following:

1. Six months after the date of the prior authorization approval.

2. The last day of the enrollee's coverage under the plan.

B. In relation to a prior authorization described in subsection A of this section, the health care services plan or its utilization review agent may request that the provider submit information to the health care services plan or its utilization review agent indicating that the enrollee's chronic pain condition has not changed and that the continuation of the treatment is not negatively impacting the enrollee's health. If the provider does not respond within five business days after the date on which the request was received, the health care services plan or its utilization review agent may terminate the prior authorization.

C. This section does not apply to:

1. Prescription medications if the United States food and drug administration recommends that the drug be used only for periods of less than six months.

2. Any opioid or benzodiazepine or other schedule I or II controlled substance.

D. This section does not prohibit the substitution of any drug that has received a six-month prior authorization under subsection A of this section when there is a release of a United States food and drug administration-approved comparable brand product or a generic counterpart of a brand product that is listed as therapeutically equivalent in the United States food and drug administration's publication titled approved drug products with therapeutic equivalence evaluations.

E. This section does not prohibit a health care services plan from granting a prior authorization for a duration longer than six months.
A.R.S. § 20-2608 — Arizona Code / Title 20 / Chapter 16 / Article 1 / Section 2608
20-2608 Variable life insurance policy application requirements
Status: in_force

20-2608. Variable life insurance policy application requirements

A variable life insurance policy application shall contain all of the following:

1. A prominent statement that the death benefit may be variable or fixed under specified conditions.

2. A prominent statement that cash values may increase or decrease according to the investment experience of the separate account.

3. Questions that enable the insurer to determine the suitability of variable life insurance for the applicant.
A.R.S. § 20-2213 — Arizona Code / Title 20 / Chapter 12 / Article 1 / Section 2213
20-2213 Initial assessment; temporary contribution by members
Status: in_force

20-2213. Initial assessment; temporary contribution by members

A. An initial assessment of up to five hundred dollars may be imposed by the director on every participating insurer of the association to defray the initial operating expenses of the plan. The initial assessment may be refunded by the association.

B. If sufficient monies are not available for the sound financial operation of the association as provided for in this chapter, all members shall contribute to the financial requirements of the association in the manner provided for in this chapter. Any such contributions shall not exceed one per cent annually of each member's net direct premium attributable to the liability insurance the member writes as a requirement for membership in the association pursuant to section 20-2202, subsection A.

C. If the association determines that the applicant meets the underwriting standards of the association, as prescribed in the plan of operation, the association, on receipt of the premium or the portion of the premium as is prescribed in the plan of operation, shall cause a policy of liability insurance to be issued.
A.R.S. § 20-716 — Arizona Code / Title 20 / Chapter 4 / Article 1 / Section 716
20-716 Rights of mutual insurer member
Status: in_force

20-716. Rights of mutual insurer member

With respect to the management, records and affairs of the insurer, a member of a domestic mutual insurer shall have the same character of rights and relationship as a stockholder has toward a domestic stock insurer.
A.R.S. § 20-3458 — Arizona Code / Title 20 / Chapter 27 / Article 1 / Section 3458
20-3458 Recredentialing
Status: in_force

20-3458. Recredentialing

A. A health insurer or its designee may recredential participating providers at least once every thirty-six months and more frequently if required by federal or state law or the health insurer's accreditation standards, or if permitted by the health insurer's contract with the participating provider.  Nothing in this section shall affect the contract termination rights of a health insurer or a participating provider.

B. A participating provider remains credentialed and loaded in the health insurer's billing system unless the health insurer discovers information that would result in the participating provider ceasing to meet the health insurer's guidelines for participation, in which case the health insurer shall provide the participating provider a written explanation for the change in status.
A.R.S. § 20-714 — Arizona Code / Title 20 / Chapter 4 / Article 1 / Section 714
20-714 Quorum of members of mutual insurer
Status: in_force

20-714. Quorum of members of mutual insurer

A domestic mutual insurer may in its bylaws adopt a reasonable provision for determining a quorum of members at any meeting of the insurer, but no provision recognizing a quorum of fewer than a simple majority of all the insurer's members shall be effective unless approved as reasonable by the director of the department of insurance and financial institutions. This section does not affect any other law requiring a vote of a larger percentage of members for a specified purpose.
A.R.S. § 20-490.01 — Arizona Code / Title 20 / Chapter 2 / Article 14 / Section 490.01
20-490.01 Suspension of limitations period
Status: in_force

20-490.01. Suspension of limitations period

A. Notwithstanding any other law, a holocaust victim or the heir, assignee, beneficiary or successor of a holocaust victim who resides in this state and who has a claim arising out of an insurance policy that was purchased or in effect in Europe before 1946 and that was delivered, issued for delivery or renewed by an insurer may bring an action against an insurer to recover on that claim in a court of competent jurisdiction in this state.

B. A court shall not dismiss an action brought under subsection A for failure to comply with any applicable limitations period if the action is brought on or before December 31, 2012.
A.R.S. § 20-1008 — Arizona Code / Title 20 / Chapter 4 / Article 7 / Section 1008
20-1008 Examination of prepaid dental plan organization
Status: in_force

20-1008. Examination of prepaid dental plan organization

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 prepaid dental plan organization organized under the laws of this state and examine its financial condition and 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 visit and examine each prepaid dental plan 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 prepaid dental plan 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 most recent examination of a foreign or alien prepaid dental plan organization, certified to by the appropriate examining official of another state, territory, commonwealth or district of the United States.

D. On request by the director of the department of insurance and financial institutions, the director of the department of health services or another person the director of the department of insurance and financial institutions determines to be qualified may participate in the examinations and visits described in this section to verify the existence of an effective prepaid dental plan and to review the delivery of services by the prepaid dental plan organization.
A.R.S. § 20-251 — Arizona Code / Title 20 / Chapter 2 / Article 2 / Section 251
20-251 Definitions not mutually exclusive
Status: in_force

20-251. Definitions not mutually exclusive

It is intended that certain coverages may come within the definitions of two or more kinds of insurance as set forth in this article, and the fact that such a coverage is included within one definition shall not exclude such coverage as to any other kind of insurance within the definition of which such coverage likewise reasonably is includable.
A.R.S. § 20-142 — Arizona Code / Title 20 / Chapter 1 / Article 2 / Section 142
20-142 Powers and duties of director; payment of examination and investigation costs; home health services
Status: in_force

20-142. Powers and duties of director; payment of examination and investigation costs; home health services

A. The director shall enforce this title.

B. The director shall have powers and authority expressly conferred by or reasonably implied from the provisions of this title.

C. The director may conduct examinations and investigations of insurance matters, including examinations and investigations of adjusters, producers and brokers and any other persons who are regulated under this title, in addition to examinations and investigations expressly authorized, as the director deems proper in determining whether a person has violated any provision of this title or for the purpose of securing information useful in the lawful administration of any provision of this title.  The examined party shall pay the costs of examinations that are allowed pursuant to subsection D of this section and that are conducted pursuant to this subsection except for examinations of adjusters, producers and brokers. An examined adjuster, producer or broker shall pay the costs allowed pursuant to subsection D of this section only if the adjuster, producer or broker is found to have violated any provision of this title. This state shall pay the cost of any related investigation.

D. The department shall prepare detailed billing statements that provide reasonable specificity of the time and expenses billed in connection with an examination and that cite the statute or rule that authorizes the fees being charged.  Notwithstanding any other law, from and after December 31, 2021, a person that is being examined pursuant to any section of this title is responsible for only the direct costs of an examination that are supported by a billing statement that complies with this subsection.

E. The director shall establish guidelines for insurers on home health services that shall be used by the director pursuant to sections 20-826, 20-1342, 20-1402 and 20-1404. The director may use home health services as defined in section 36-151. Guidelines shall include the following:

1. Home health services that are prescribed by a physician or a registered nurse practitioner.

2. Home health services that are determined to cost less if provided in the home than the average length of in-hospital service for the same service.

3. Skilled professional care in the home that is comparable to skilled professional care provided in-hospital and that is reviewed and approved at thirty-day intervals by a physician.

F. Pursuant to section 41-1750, subsection G, the director may receive criminal history record information in connection with the issuance, renewal, suspension or revocation of a license or certificate of authority or the consideration of a merger or acquisition. The director may require a person to submit a full set of fingerprints to the department.  The department of insurance and financial institutions shall submit the fingerprints to the department of public safety for the purpose of obtaining a state and federal criminal records check pursuant to section 41-1750 and Public Law 92-544.  The department of public safety may exchange this fingerprint data with the federal bureau of investigation.
A.R.S. § 20-823 — Arizona Code / Title 20 / Chapter 4 / Article 3 / Section 823
20-823 Incorporation of hospital, medical, dental and optometric service corporations
Status: in_force

20-823. Incorporation of hospital, medical, dental and optometric service corporations

The corporation as defined in section 20-822 shall be organized under the laws of this state relating to private corporations not for pecuniary profit, insofar as such laws are not inconsistent with any of the provisions of this article.
A.R.S. § 20-1243.07 — Arizona Code / Title 20 / Chapter 6 / Article 1.3 / Section 1243.07
20-1243.07 Producer training; annuities; continuing education
Status: in_force

20-1243.07. Producer training; annuities; continuing education

A. A producer may not solicit the sale of an annuity product unless the producer has adequate knowledge of the product to recommend the annuity and the producer is in compliance with the insurer's standards for product training. A producer may rely on insurer-provided product-specific training standards and materials to comply with this subsection.

B. Before selling, soliciting or negotiating an annuity, a producer with a life insurance line of authority shall complete a onetime four credit-hour training course approved pursuant to section 20-2904 that is provided by an education provider approved pursuant to section 20-2904.

C. The minimum length of the training required under subsection B of this section shall be sufficient to qualify for at least four continuing education credit hours, but may be longer. The training required under subsection B of this section shall include information on the following topics:

1. Types of annuities and various classifications of annuities.

2. Identification of the parties to an annuity.

3. How product-specific annuity contract features affect consumers.

4. The application of income taxation of qualified and nonqualified annuities.

5. The primary uses of annuities.

6. Appropriate standard of conduct, sales practices, replacement requirements and disclosure requirements.

D. A provider of an annuity training course intended to comply with this section shall cover all topics listed in subsection C of this section and may not present any marketing information, provide training on sales techniques or provide specific information about a particular insurer's products.  Additional topics may be offered in conjunction with and in addition to the topics listed in subsection C of this section. A provider of an annuity training course intended to comply with this section shall register as a continuing education provider in this state and shall comply with the rules and guidelines applicable to producer continuing education courses required by chapter 18 of this title.  A provider of an annuity training course shall comply with the reporting requirements and shall issue a certificate of completion in accordance with chapter 18 of this title.

E. Annuity training courses may be conducted and completed by classroom or self-study methods in accordance with chapter 18 of this title and any rules of the department.  Satisfactory completion of the training requirements of another state that are substantially similar to the provisions of this section satisfy the training requirements of this section. Satisfactory completion of the components of the training requirements of any course or courses with components that are substantially similar to the requirements prescribed in this section satisfy the training requirements of this section.

F. An insurer shall verify that a producer has completed the annuity training course required under this section before allowing the producer to sell an annuity product for that insurer.  An insurer may satisfy its responsibility under this subsection by obtaining certificates of completion of the annuity training course or obtaining reports provided by department-sponsored database systems or vendors or from a reasonably reliable commercial database vendor that has a reporting arrangement with approved insurance education providers.
A.R.S. § 20-2414 — Arizona Code / Title 20 / Chapter 14 / Article 1 / Section 2414
20-2414 Annual report
Status: in_force

20-2414. Annual report

A. The director shall annually report the following information to the president of the senate and the speaker of the house of representatives:

1. The number of risk retention groups licensed in this state since August 6, 2016.

2. Any regulatory action taken by the director against a risk retention group licensed in this state for noncompliance with section 20-2402.

B. The director may provide the report required by subsection A of this section in an electronic format.
A.R.S. § 20-887 — Arizona Code / Title 20 / Chapter 4 / Article 4 / Section 887
20-887 Examination of societies; limitation on disclosure
Status: in_force

20-887. Examination of societies; limitation on disclosure

A. The director or the director's designee may examine any domestic, foreign or alien society that is authorized or applying for authorization to transact business in this state in the same manner as prescribed by section 20-156.

B. The director shall not make public any financial statement, report or finding pending, during or after an examination or investigation of a domestic or foreign society. The director shall not make public any financial statement, report or finding affecting the status, standing or rights of the society until a copy of the statement, report or finding is served on the society at its home office and the society is afforded a reasonable opportunity to answer and make a showing in connection with the statement, report or finding.

C. On a statement from the director, the society shall pay for the expenses of each examination and valuation, including the compensation and actual expenses of the examiners.
A.R.S. § 20-1616.01 — Arizona Code / Title 20 / Chapter 6 / Article 10 / Section 1616.01
20-1616.01 Penalties
Status: in_force

20-1616.01. Penalties

In addition to any other penalties authorized by this title, after notice and a hearing, the director may impose on an insurer that violates an order of the director that is issued pursuant to this article or any rule adopted pursuant to this article a civil penalty of not more than one thousand dollars for each violation but not to exceed an aggregate penalty of one hundred thousand dollars, except that, if the violation was committed flagrantly in a conscious disregard of this article, the civil penalty shall not be more than twenty-five thousand dollars for each violation but not to exceed an aggregate penalty of two hundred fifty thousand dollars.
A.R.S. § 20-400.10 — Arizona Code / Title 20 / Chapter 2 / Article 4.2 / Section 400.10
20-400.10 Industrial insureds
Status: in_force

20-400.10. Industrial insureds

A. An industrial insured as defined in section 20-401.07 may purchase and an admitted insurer may sell to an industrial insured a policy of insurance that is subject to article 4.1 of this chapter and that is on a form that has not been filed for review or approval by the director pursuant to article 4.1 of this chapter. The admitted insurer may use rates for a policy provided pursuant to this section that have not been filed for review or approval by the director pursuant to article 4.1 of this chapter.

B. At the inception of each new policy and at the time of each renewal, but not less than annually during the term of the policy, each industrial insured that purchases a policy as provided in this section shall certify to the insurer on a form prescribed by the director that the insured meets the definition of industrial insured prescribed in section 20-401.07.

C. Except as otherwise provided in section 20-407, subsection B, the insurer shall maintain the certification described in subsection B of this section in the insurer's policy file.

D. The following provisions do not apply to insurance issued to industrial insureds pursuant to this section:

1. Section 20-229.

2. Section 20-400.

3. Sections 20-400.01 through 20-400.05 and 20-400.07.

4. Section 20-448, subsection C.

5. Section 20-451.

6. Section 20-452.

7. Section 20-465.

8. Sections 20-1111 through 20-1117.

9. Sections 20-1120, 20-1121 and 20-1122.

10. Article 4.1 of this chapter.

11. Chapter 3, article 6 of this title.

12. Chapter 6, articles 7 and 14 of this title.

E. Any policy issued for delivery to an industrial insured in this state by an insurer pursuant to this section shall contain a conspicuously stamped or written notice in bold-faced type that states:

Pursuant to Arizona Revised Statutes section 20-400.10, this policy and the rates charged for it have not been filed with or approved by the director of the Arizona department of insurance and financial institutions. Certain provisions of Arizona law, specified in Arizona Revised Statutes section 20-400.10, do not apply to this policy.  If the insurer that issued this policy becomes insolvent, insureds or claimants will not be eligible for insurance guaranty fund protection pursuant to Arizona Revised Statutes title 20.

F. An insurer shall annually file with the insurer's annual statement filed pursuant to section 20-223 on a form prescribed by the director the following information for the prior year ending December 31 for all policies issued to industrial insureds pursuant to this section:

1. The total number of policies written.

2. The total premiums written.

3. The total premiums earned.

4. The total losses paid.

5. The total losses incurred.

6. The total number of claims incurred.

7. Any other information the director deems appropriate.
A.R.S. § 20-1603 — Arizona Code / Title 20 / Chapter 6 / Article 10 / Section 1603
20-1603 Definitions
Status: in_force

20-1603. Definitions

In this article, unless the context otherwise requires:

1. "Consumer credit insurance" means any one or a combination of the following:

(a) Credit life insurance.

(b) Credit disability insurance.

(c) Credit unemployment insurance.

2. "Credit disability insurance" means insurance on a debtor to provide indemnity for payments becoming due or outstanding on a specific loan or other credit transaction while the debtor has a disability as defined in the policy or certificate.

3. "Credit life insurance" means insurance on the life of a debtor pursuant to or in connection with a specific loan or other credit transaction that provides for the satisfaction of a debt, in whole or in part, on the death of an insured debtor.

4. "Credit unemployment insurance" means casualty insurance on a debtor to provide indemnity for payments or debt becoming due on a specific loan or other credit transaction while the debtor is involuntarily unemployed as defined in the policy.

5. "Creditor" means the lender of money or vendor or lessor of goods, services, property, rights or privileges, including a lessor under a lease intended as a security, where payment is arranged through a credit transaction.  "Creditor" means also any successor to the right, title or interest of any such lender, vendor or lessor or an affiliate, associate or subsidiary of any of them or any director, officer or employee of any of them or any other person in any way associated with any of them.

6. "Debtor" means a borrower of money or a person possessing a commitment for a loan of certain funds or a purchaser or lessee of goods, services, property, rights or privileges for which payment is arranged through a credit transaction.

7. "Gross debt" means the sum of the remaining payments that a debtor owes a creditor.

8. "Identifiable charge" means a charge for a type of consumer credit insurance that is made to debtors having that insurance and not made to debtors not having the insurance, and that includes a charge for insurance that is disclosed in the credit or other instrument furnished to the debtor that states the financial elements of the credit transaction and any difference in the finance, interest, service or other similar charge made to debtors in like circumstances except for the insured or noninsured status of the debtor or of the property used as security for the credit transaction.

9. "Loan" means an advance or commitment of certain funds pursuant to a repayment agreement.

10. "Net debt" means the amount necessary to liquidate a debt in a single lump sum payment, excluding all unearned interest and other unearned finance charges.
A.R.S. § 20-886 — Arizona Code / Title 20 / Chapter 4 / Article 4 / Section 886
20-886 Certificate of authority; termination
Status: in_force

20-886. Certificate of authority; termination

A certificate of authority issued to a society remains in effect on payment of the annual renewal fee prescribed by section 20-167 unless the society voluntarily terminates or the director suspends or revokes the certificate.
A.R.S. § 20-1066 — Arizona Code / Title 20 / Chapter 4 / Article 9 / Section 1066
20-1066 Rehabilitation, liquidation or conservation of health maintenance organization
Status: in_force

20-1066. Rehabilitation, liquidation or conservation of health maintenance organization

A. Any rehabilitation, liquidation, or conservation of a health care services organization shall be deemed to be the rehabilitation, liquidation, or conservation of an insurer and shall be conducted as provided in chapter 3, article 4 of this title.

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.
A.R.S. § 20-648 — Arizona Code / Title 20 / Chapter 3 / Article 4 / Section 648
20-648 Receivership liquidation fund; purpose; deposit; expenses of receivership; deputy receiver; powers and duties
Status: in_force

20-648. Receivership liquidation fund; purpose; deposit; expenses of receivership; deputy receiver; powers and duties

A. The director shall appoint a deputy receiver to administer the conservation, rehabilitation or liquidation of an insurer pursuant to this article.

B. A receivership liquidation fund is established. The deputy receiver shall file a petition with the court authorizing the deputy receiver to deposit in the fund ten per cent of the insolvent insurer's deposit required under section 20-213.

C. The common administrative costs of the receiverships incurred by the deputy receiver are payable from the receivership liquidation fund.  The director shall by order after a hearing describe the nature of administrative costs common to every receivership in the operation of the receivership office that are payable from this fund. Costs may include the compensation of special deputies, clerks or assistants but shall not include attorney fees.

D. The deputy receiver shall prepare and file with the court a quarterly financial report listing expenditures and the balance remaining in the fund allocable to the respective insurer. On termination of a receivership, the deputy receiver shall remit any balance remaining in the fund that is allocated to a particular insurer to the separate account for that receivership or to the person entitled to the monies. If the common administrative expenses allocable to a receivership exceed the initial ten per cent deposit to the fund, the deputy receiver may petition the court to authorize an amount, equal to the excess, to be deposited in the fund.

E. On notice from the director, the state treasurer shall invest and divest monies in the receivership liquidation fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.
A.R.S. § 20-1097.11 — Arizona Code / Title 20 / Chapter 4 / Article 13 / Section 1097.11
20-1097.11 Assets; valuation; reporting
Status: in_force

20-1097.11. Assets; valuation; reporting

A. The assets of a prepaid legal insurance corporation 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, he may employ one or more appraisers for that purpose, and the reasonable expense thereof and shall be borne by the corporation.

B. The corporation shall include the information required by subsection A in its annual statement filed with the director pursuant to section 20-1097.12.
A.R.S. § 20-268 — Arizona Code / Title 20 / Chapter 2 / Article 2 / Section 268
20-268 Motor vehicle subrogation
Status: in_force

20-268. Motor vehicle subrogation

A. If a motor vehicle claim is subject to subrogation, the insured may bring a cause of action separate and apart from the insurer seeking recovery of damages for which the insured has not been compensated by the insurer. Any settlement or judgment of the claim of the insured alone shall not affect the rights of the insurer.

B. If requested in writing by an insured, the insurer shall report to the insured the status of the subrogated claim.
A.R.S. § 20-689 — Arizona Code / Title 20 / Chapter 3 / Article 7 / Section 689
20-689 Prevention of impairments
Status: in_force

20-689. Prevention of impairments

To aid in the detection and prevention of member insurer impairments and insolvencies:

1. The board of directors, on majority vote, shall notify the director of any information indicating that any member insurer may be unable or potentially unable to fulfill its contractual obligations.

2. The board of directors, on majority vote, may request that the director order an examination of any member insurer which the board in good faith believes may be unable or potentially unable to fulfill its contractual obligations. The director may conduct such examination. The examination may be conducted as a national association of insurance commissioners examination or may be conducted by such persons as the director designates. The cost of such examination shall be paid by the fund and the examination report shall be treated as are other examination reports.  The examination report shall not be released to the board of directors of the fund before its release to the public, but this shall not excuse the director from the obligation to comply with paragraph 3. The director shall notify the board of directors when the examination is completed. The request for an examination shall be kept on file by the director but it shall not be open to the public and shall be released only if the examination discloses that the examined insurer is unable or potentially unable to meet its contractual obligations.

3. The director shall report to the board of directors when the director has reasonable cause to believe that any member insurer examined at the request of the board of directors may be unable or potentially unable to fulfill its contractual obligations.

4. The board of directors, on majority vote, may make reports and recommendations to the director on any matter germane to the solvency, liquidation, rehabilitation or conservation of any member insurer. Such reports and recommendations shall not be considered public documents.

5. The board of directors, on majority vote, may make recommendations to the director for the detection and prevention of member insurer impairments and insolvencies.

6. The board of directors, at the conclusion of any insurer impairment or insolvency in which the fund carried out its duties, shall prepare a report on the history and causes of such impairment or insolvency based on the information available to the fund and submit such report to the director.
A.R.S. § 20-485.10 — Arizona Code / Title 20 / Chapter 2 / Article 9 / Section 485.10
20-485.10 Deposit or surety bond of administrators; amount; purpose
Status: in_force

20-485.10. Deposit or surety bond of administrators; amount; purpose

Every administrator shall possess and maintain a deposit in favor of this state to be held in trust for the benefit and protection of insureds and insurers whose monies the administrator handles consisting of cash, securities eligible for investment pursuant to chapter 3, articles 1 and 2 of this title, or a surety bond in a form acceptable to the director and issued by a corporate surety authorized to transact business in this state. The amount of the deposit shall be ten per cent of the amount of total funds handled unless the director determines that a lesser amount is adequate for the protection of the public but in no case shall the bond be less than five thousand dollars. The amount of the deposit shall be determined by the total funds handled by the administrator during the preceding year, or if no funds were handled during the preceding year, the amount of funds reasonably estimated to be handled during the current calendar year by the administrator. The amount of such deposit is payable on the failure of the administrator to pay benefits it is legally obligated to pay and shall provide protection to the insurers and insureds against loss by reason of acts of fraud or dishonesty and may include individual bonds or schedule or blanket forms of bonds.
A.R.S. § 20-466.01 — Arizona Code / Title 20 / Chapter 2 / Article 6 / Section 466.01
20-466.01 Fraud; classification
Status: in_force

20-466.01. Fraud; classification

A person who violates section 20-463 or 20-463.01 with the intent to injure, defraud or deceive an insurer is guilty of a class 6 felony.
A.R.S. § 20-3111 — Arizona Code / Title 20 / Chapter 20 / Article 2 / Section 3111
20-3111 Definitions
Status: in_force

20-3111. Definitions

In this article, unless the context otherwise requires:

1. "Arbitration" means a dispute resolution process in which an impartial arbitrator determines the dollar amount a health care provider is entitled to receive for payment of a surprise out-of-network bill.

2. "Arbitrator" means an impartial person who is appointed to conduct an arbitration.

3. "Billing company" means any affiliated or unaffiliated company that is hired by a health care provider or health care facility to coordinate the payment of bills with health insurers and to generate or bill and collect payment from enrollees on the health care provider's or health care facility's behalf.

4. "Contracted provider" means a health care provider that has entered into a contract with a health insurer to provide health care services to the health insurer's enrollees at agreed on rates.

5. "Cost sharing requirements" means an enrollee's applicable out-of-network coinsurance, copayment and deductible requirements under a health plan based on the adjudicated claim.

6. "Emergency services" has the same meaning prescribed in section 20-2801.

7. "Enrollee" means an individual who is eligible to receive benefits through a health plan.

8. "Health care facility" has the same meaning prescribed in section 36-437.

9. "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 a patient in a network facility and that separately bills the patient for the services.

10. "Health care services" means treatment, services, medications, tests, equipment, devices, durable medical equipment, laboratory services or supplies rendered or provided to an enrollee for the purpose of diagnosing, preventing, alleviating, curing or healing human disease, illness or injury.

11. "Health insurer" means a disability insurer, group disability insurer, blanket disability insurer, hospital service corporation or medical service corporation that provides health insurance in this state.

12. "Health plan" means a group or individual health plan that finances or furnishes health care services and that is issued by a health insurer.

13. "Network facility" means a health care facility that has entered into a contract with a health insurer to provide health care services to the health insurer's enrollees at agreed on rates.

14. "Surprise out-of-network bill" means a bill for a health care service that was provided in a network facility by a health care provider that is not a contracted provider and that meets one of the requirements listed in section 20-3113.
A.R.S. § 20-1026 — Arizona Code / Title 20 / Chapter 4 / Article 8 / Section 1026
20-1026 Reserves for liabilities and losses
Status: in_force

20-1026. Reserves for liabilities and losses

Underwriters doing business as a Lloyd's association shall compute reserve liabilities for all outstanding business and for all incurred losses upon the same basis required for stock insurance companies doing the same class and character of business in Arizona.
A.R.S. § 20-882 — Arizona Code / Title 20 / Chapter 4 / Article 4 / Section 882
20-882 Applicable insurance provisions
Status: in_force

20-882. Applicable insurance provisions

Fraternal benefit societies are governed by this article and are subject to and governed by the following articles and sections of this title to the extent that the articles and sections apply to the societies and are not modified by the provisions of this article:

1. Chapter 1, articles 1 and 2 of this title.

2. Chapter 2, article 1 of this title, except that sections 20-209 through 20-214, 20-224, 20-224.01, 20-224.02, 20-225, 20-226, 20-227 and 20-229 do not apply to fraternal benefit societies.

3. Sections 20-501 through 20-505 and 20-511 through 20-514.

4. Chapter 3, article 2 of this title, except that section 20-535, section 20-536, subsections B and C and section 20-556, paragraphs 4 and 6 do not apply to limitations with respect to monies invested in real property for home or branch office purposes.

5. Chapter 3, article 4 of this title.

6. Chapter 3, article 8 of this title.

7. Sections 20-1110, 20-1111, 20-1115, 20-1133 and 20-1135.

8. Section 20-1408.
A.R.S. § 20-1119 — Arizona Code / Title 20 / Chapter 5 / Article 1 / Section 1119
20-1119 Construction of policies; translation; disclaimer
Status: in_force

20-1119. Construction of policies; translation; disclaimer

A. Every insurance contract shall be construed according to the entirety of its terms and conditions as set forth in the policy and as amplified, extended or modified by any rider, endorsement or application attached to and made a part of the policy.

B. An insurance policy that is translated into a language other than English and that is issued for delivery by an insurer in this state does not amplify, extend or modify the terms of the English language version of the policy if the policy contains a disclaimer that is prominently displayed on the cover page or a page that corresponds to the cover page in a contrasting color or bold-faced type in the translated language and that states: "The English language version of this policy controls in the event of a conflict or varying interpretation of the coverage provided under this policy".
A.R.S. § 20-1271 — Arizona Code / Title 20 / Chapter 6 / Article 2 / Section 1271
20-1271 Grace period in group annuity contracts
Status: in_force

20-1271. Grace period in group annuity contracts

In group annuity contracts there shall be a provision that there shall be a period of grace, either of thirty days or of one month, within which any stipulated payment to be remitted by the holder to the insurer, falling due after one year from date of issue, may be made, subject, at the option of the insurer, to an interest charge thereon at a rate to be specified in the contract, which shall not exceed six per cent per annum for the number of days of grace elapsing before such payment.