Bill Text: AZ SB1477 | 2018 | Fifty-third Legislature 2nd Regular | Introduced
Bill Title: Reinsurance; workers compensation
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2018-02-27 - Senate majority caucus: Hold [SB1477 Detail]
Download: Arizona-2018-SB1477-Introduced.html
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REFERENCE TITLE: reinsurance; workers compensation |
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State of Arizona Senate Fifty-third Legislature Second Regular Session 2018
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SB 1477 |
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Introduced by Senator Fann
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AN ACT
Amending title 20, chapter 5, article 1, Arizona Revised Statutes, by adding section 20-1110.02; relating to insurance contracts.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Title 20, chapter 5, article 1, Arizona Revised Statutes, is amended by adding section 20-1110.02, to read:
20-1110.02. Qualified loss sensitive programs; filing; definitions
A. When a qualified insurer in this state issues a guaranteed cost workers' compensation insurance policy to a qualified insured on an approved form and with approved rates, any accompanying offering of a qualified loss sensitive program of reinsurance does not require the approval of the director but shall be filed with the director for informational purposes.
B. For the purposes of this section:
1. "Guaranteed cost workers' compensation insurance policy" means a workers' compensation policy that is based on approved rates multiplied by applicable class codes and is not changed by losses in the period for which it is issued.
2. "Qualified insured" means an insured that has its principal place of business in this state and that has a total annual workers' compensation premium of at least five hundred thousand dollars.
3. "Qualified insurer" means an insurance company that meets all of the following:
(a) Is admitted in this state.
(b) Has a combined loss ratio of less than one hundred on January 1 of the two preceding years.
(c) Has assets in excess of five hundred million dollars on January 1 of the year in which the guaranteed cost workers compensation insurance policy is issued.
(d) Has a rating of A+ from a nationally recognized statistical rating organization designated by the national association of insurance commissioners.
4. "Qualified loss sensitive program of reinsurance" means an offering that meets all of the following:
(a) Is issued to the same qualified insured in connection with a guaranteed cost workers' compensation insurance policy.
(b) Is effected through a separate reinsurance arrangement with a reinsurer admitted in a national association of insurance commissioners' accredited state.
(c) Provides that the qualified insured may participate in the underwriting profit or risk associated with the guaranteed cost workers' compensation insurance policy issued to that qualified insured maintained in a segregated cell account.
(d) Contains a minimum and maximum loss participation limit.
(e) Discloses the time length of the program of reinsurance.
(f) Discloses penalties, if any, for the early termination of the program of reinsurance.
(g) Provides an estimated schedule of payments.
(h) Discloses the methodology for calculating charges, deposits or other payments due.
