Bill Text: AZ SB1567 | 2011 | Fiftieth Legislature 1st Regular | Engrossed
Bill Title: Workers' compensation deductible coverage; report [Track Bill]
Status: 2011-04-28 - Governor Signed [SB1567 Detail]
House Engrossed Senate Bill
State of Arizona
First Regular Session
SENATE BILL 1567
amending sections 20-1674, 20-1676 and 20-1677, Arizona Revised Statutes; relating to insurance notices.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Section 20-1674, Arizona Revised Statutes, is amended to read:
20-1674. Notice of cancellation
A. No cancellation under section 20‑1673 is effective unless the insurer mails a copy of the notice of cancellation to the insured's agent and written notice of the cancellation is mailed by certified mail to the named insured at the address shown in the policy or to the last known address of the insured at least sixty forty-five days before the effective date of the cancellation, except that, if cancellation is for nonpayment of premium, at least ten days' notice of cancellation must be given. The notice must state the specific facts which constitute the grounds set forth in section 20‑1673 which are relied on.
B. The notice of cancellation shall be accompanied by a refund of unearned premium, except a premium that has been financed.
Sec. 2. Section 20-1676, Arizona Revised Statutes, is amended to read:
20-1676. Notice of nonrenewal
A. This article does not apply to the nonrenewal of insurance policies except as provided in subsection B.
B. No nonrenewal of any policy of insurance to which this article applies is effective unless the insurer mails a copy of the notice of nonrenewal to the insured's agent and mails by certified mail written notice to the named insured, at the address shown in the policy or to the last known address of the insured, at least sixty 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 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 mailed less than sixty forty-five days before expiration, the coverage shall remain in effect until sixty forty-five days after the notice is mailed. Earned premium for any period of coverage that extends beyond the expiration date shall be considered pro rata based upon the previous year's rate.
Sec. 3. Section 20-1677, Arizona Revised Statutes, is amended to read:
20-1677. Notice of premium or coverage changes
A. An insurer shall mail or deliver to the named insured at the mailing address shown on the policy written notice of premium increase, change in deductible or reduction in limits or substantial reduction in coverage at least sixty thirty days before the expiration date of the policy. If the insurer fails to provide the sixty thirty days' notice, the coverage provided to the named insured remains in effect until notice is given or until the effective date of replacement coverage obtained by the named insured, whichever occurs first.
B. Notice is considered given sixty thirty days following the date of mailing or delivery of the notice. If the insured elects not to renew, any earned premium for the period of extension of the terminated policy shall be calculated pro rata at the lower of the current or previous year's rate. If the insured accepts the renewal, the premium increase, if any, and other changes are effective the day following the prior policy's expiration or anniversary date.
C. For the purposes of this section, notice shall be considered given if an insurer delivers new policy terms and conditions thirty days before the expiration date of the policy.