A.R.S. tit. 20 ch. 1 — Arizona Revised Statutes Title 20 Chapter 1 — General Provisions

20-101. Department of insurance and financial institutions; definition A. The department of insurance and financial institutions is established and shall be administered by the director of the department of insurance and financial institutions. B. The department shall be known as "DIFI". C. In this title, unless the context otherwise requires, "commission" or "department" means the department of insurance and financial institutions. 20-101.01. Deputy director The director shall appoint a deputy director of the insurance division of the department to assist the director with the execution of the laws of this state relating to insurance. The deputy director serves at the pleasure of the director and reports directly to the director. 20-102. Definition of director In this title, title 6, title 32, chapters 9 and 36, title 41, chapter 31 and title 44, chapter 2.1, unless the context otherwise requires: 1. "Director" or "administrator" means the director of the department of insurance and financial institutions. 2. When used with reference to a member of the governing body of an insurer, director includes trustee. 20-103. Definition of insurance; exceptions A. For the purposes of this title, except as otherwise provided, "insurance" is a contract by which one undertakes to indemnify another or to pay a specified amount on determinable contingencies. B. Private ambulance service contracts or private fire protection service contracts are not insurance, and this title does not apply to those contracts. C. Charitable gift annuities that are issued pursuant to section 20-119 are not insurance and, except as provided in section 20-119, this title does not apply to agreements for those annuities. D. Collision damage waivers are not insurance, and this title does not apply to those waivers. E. Direct primary care agreements as defined in section 44-1799.91 are not insurance, and this title does not apply to those agreements. F. Guaranteed asset protection waivers are not insurance, and this title does not apply to those waivers. For the purposes of this subsection, "guaranteed asset protection waiver" means a contractual agreement that is a part of or an addendum to a borrower's finance agreement wherein a creditor agrees for a separate charge to cancel or waive all or part of the amount due on the borrower's finance agreement in the event of a total physical damage loss or unrecovered theft of a motor vehicle. 20-104. "Insurer" defined "Insurer" includes every person engaged in the business of making contracts of insurance. 20-105. "Person" defined "Person" includes an individual, company, insurer, association, organization, society, reciprocal or inter-insurance exchange, partnership, syndicate, business trust, corporation and entity. 20-106. Acts constituting the transaction of business; definition A. "Transact" with respect to insurance includes any of the following: 1. Solicitation and inducement. 2. Preliminary negotiations. 3. Effectuation of a contract of insurance. 4. Transaction of matters subsequent to effectuation of the contract and arising out of it. B. Any of the following acts in this state effected by mail or otherwise, by or on behalf of an unauthorized insurer, is deemed to constitute the transaction of an insurance business in this state: 1. The making of or proposing to make, as an insurer, an insurance contract. 2. The making of or proposing to make, as guarantor or surety, any contract of guaranty or suretyship as a vocation and not merely incidental to any other legitimate business or activity of the guarantor or surety. 3. The taking or receiving of any application for insurance. 4. The receiving or collection of any premium, commission, membership fees, assessments, dues or other consideration for any insurance or any part thereof. 5. The issuance or delivery of contracts of insurance to residents of this state or to persons authorized to do business in this state. 6. Directly or indirectly acting as an insurance producer or agent for or otherwise representing or aiding on behalf of another any person or insurer in the solicitation, negotiation, procurement or effectuation of insurance or renewals thereof or in the dissemination of information as to coverage or rates, or forwarding of applications, or delivery of policies or contracts, or inspection of risks, a fixing of rates or investigation or adjustment of claims or losses or in the transaction of matters subsequent to effectuation of the contract and arising out of it, or in any other manner representing or assisting a person or insurer in the transaction of insurance with respect to subjects of insurance resident, located or to be performed in this state. The provisions of this paragraph shall not operate to prohibit full-time salaried employees of a corporate insured from acting in the capacity of an insurance manager or buyer in placing insurance in behalf of such employer. 7. The transaction of any kind of insurance business specifically recognized as transacting an insurance business within the meaning of the statutes relating to insurance. 8. The transacting or proposing to transact any insurance business in substance equivalent to any provisions as provided in paragraphs 1 through 7 of this subsection in a manner designed to evade the laws of this state. C. In this section, unless the context otherwise requires, "insurer" includes all corporations, associations, partnerships and individuals engaged as principals in the business of insurance and also includes interinsurance exchanges and mutual benefit societies. 20-107. Limitation on transaction of insurance; exception A. No person shall transact a business of insurance in this state, or relative to a subject of insurance resident, located or to be performed in this state, without complying with the applicable provisions of this title. B. No provision of this title shall be deemed to require any license or other authority, or impose any penalty or requirement except as provided by section 20-421, of or upon any person for negotiation or procurement of insurance by him upon his own insurable interests, with or from an insurer not authorized to transact insurance in this state. 20-108. Types of insurers excepted This title does not apply with respect to: 1. Hospital and medical service corporations, except as stated in chapter 4, article 3 of this title. 2. Fraternal benefit societies and associations or orders as defined in section 20-861, except as stated in chapter 4, article 4 of this title. 3. Extended warranty insurers who comply with the bond requirements of section 20-108.01. For the purposes of this paragraph "extended warranty insurer" means any insurer as otherwise defined by this title that does not manufacture, sell or service radio, television or sound reproduction equipment and that: (a) For a premium charged, not greater than twenty dollars per annum, nor greater than a three-year term, provides a nonrenewable warranty, guaranty or service contract on radio, television or sound reproduction equipment in addition to, or as an extension of, any warranty, guaranty or service provided by the manufacturer of such equipment. (b) Is not otherwise authorized to transact property or casualty insurance business in this state or any other governmental jurisdiction. (c) Is not owned or controlled in any degree nor to any extent by a person, persons or business otherwise authorized to transact property or casualty insurance business in this state or any other state or jurisdiction. (d) Has gross sales in this state not exceeding one hundred thousand dollars annually. (e) Has maximum contractual contingent liability not exceeding three hundred thousand dollars in this state. 20-108.01. Extended warranty insurers; deposit with state treasurer; powers and duties; definition A. Every extended warranty insurer shall deposit with the state treasurer and maintain on deposit for the benefit and protection of any person purchasing such extended warranty or guaranty in the event of insolvency of the extended warranty insurer under its contract with any such person either of the following: 1. A bond in the amount of $25,000 issued by an insurance company holding a current certificate of authority issued by the director. 2. Eligible securities as defined in section 20-583 having the lesser of par or market value of not less than $25,000. B. The director may adopt rules and regulations to enforce this section. C. For the purposes of this section, "extended warranty insurer" has the same meaning prescribed in section 20-108. 20-109. Existing licenses A. The expiration dates of certificates of authority and licenses in force immediately prior to January 1, 1955 and lawfully existing under any law repealed by Laws 1954, chapter 64, article 29, are extended as follows: 1. Licenses or certificates of authority of insurers shall expire on April 1, 1955. 2. Licenses or certificates of authority of agents, brokers and solicitors shall expire at midnight on June 30, 1955. B. Any such expired license or certificate may be renewed, and shall be subject to suspension or revocation, as though originally issued under this title. 20-110. Secondary sources A secondary source on insurance, including any legal treatise, scholarly publication, textbook or other explanatory text, does not constitute the law or public policy of this state and is not authoritative if the secondary source purports to create, eliminate, expand or restrict a cause of action, right or remedy or if it conflicts with any of the following: 1. The United States Constitution or the Arizona Constitution. 2. State law. 3. This state's case law precedent. 4. Other common law that may have been adopted by this state. 20-111. Health insurers; savings incentive programs; definitions A. A health insurer may establish a program that provides a savings incentive for enrollees for medically necessary covered health care services that health care providers and health care facilities provide at a price that is below the health insurer's usual reimbursement. B. The program may enable an eligible enrollee who receives covered health care services from a health care provider or health care facility at a price below the health insurer's usual reimbursement to have the amount the enrollee pays applied toward the enrollee's deductible and out-of-pocket maximum and be reimbursed for a portion of the amount of the difference between the price the enrollee paid and the health insurer's usual reimbursement. C. For the purposes of this section: 1. "Health care facility" means a hospital, outpatient surgical center, health care laboratory, diagnostic imaging center or urgent care center. 2. "Health care provider" has the same meaning prescribed in section 32-3216. 3. "Health insurer" has the same meaning prescribed in section 32-3216. 4. "Usual reimbursement" means the amount the health insurer would ordinarily pay an in-network health care provider or an in-network health care facility for the service. 20-112. Existing actions or violations Repeal by this title of any law shall not affect or abate any right accrued, action or proceeding commenced, or any unlawful act committed under such law, prior to January 1, 1955, and punishment or deprivation of license or authority as a consequence thereof as provided by such laws, but all proceedings taken on or after January 1, 1955 with respect thereto shall conform to the applicable provisions of this code insofar as possible. All such laws shall be deemed to continue in force to the extent made necessary by this provision. 20-113. Construction of particular and general provisions Provisions of this title relative to a particular kind of insurance or a particular type of insurer or to a particular matter shall prevail over provisions relating to insurance in general or insurers in general or to such matter in general. 20-114. Violations; classification In addition to any other penalty applicable thereto, either under this title or otherwise, violation of any provision of this title is a class 2 misdemeanor and shall be punishable as such where no other penalty is provided therefor. 20-115. Department jurisdiction over certain health care providers; exception; examination; disclosure A. Any person or other entity, including a provider sponsored organization that operates under the Medicare-plus-choice program established under the balanced budget act of 1997 (42 United States Code sections 1395w-21 through 1395w-28 and title XVIII, part C of the social security act, sections 1851 through 1859), that provides coverage in this state for medical, surgical, chiropractic, naturopathic medicine, occupational therapy, physical therapy, speech pathology, audiology, professional mental health, dental, hospital or optometric expenses, whether the coverage is by direct payment, reimbursement or otherwise, is presumed to be subject to the jurisdiction of the department unless the person or other entity shows that while providing coverage it is subject to the jurisdiction of another agency of this state, any political subdivision of this or any other state or the federal government. B. A person or entity that provides coverage for services identified in subsection A may show that it is subject to the jurisdiction of another agency of this state, any political subdivision of this or any other state or the federal government by providing to the director the appropriate certificate, license or other document that is issued by the other governmental agency and that permits or qualifies it to provide those services. C. Any person or entity that provides coverage in this state for services described in subsection A and is unable to show it is subject to the jurisdiction of another agency of this state, any political subdivision of this or any other state or the federal government: 1. Shall submit to an examination by the director to determine the organization and solvency of the person or the entity and to determine whether or not the person or entity is in compliance with the applicable provisions of this title. 2. Is subject to all appropriate provisions of this title regarding the conduct of its business. D. Any production agency or administrator which advertises, sells, transacts or administers coverage in this state for services described in subsection A which is provided by any person or entity described in subsection C, if that coverage is not fully insured or otherwise fully covered by an admitted life or disability insurer, nonprofit hospital service plan or nonprofit health care plan, shall advise any purchaser, prospective purchaser or covered person of the lack of insurance or other coverage. E. Any administrator which advertises or administers coverage in this state for services described in subsection A which is provided by any person or entity described in subsection C shall advise any production agency of the elements of the coverage including the amount of stop-loss insurance in effect. F. This section does not apply to or prohibit a self-insured program operated by a single employer for the benefit of its employees or the employees of a wholly-owned subsidiary. 20-116. Surety bonds; cash deposit as alternative Any provision in this title that requires a person to post a surety bond to guarantee the performance of a legal obligation is subject to the provisions of section 35-155 pertaining to accepting a cash deposit as an alternative to a surety bond. 20-117. Definitions In this title, unless the context otherwise requires: 1. "Deliver" means to cause to be provided, sent or handed over to the intended recipient. 2. "Health care services organization" has the same meaning prescribed in section 20-1051. 3. "Private passenger motor vehicle" means any vehicle that is rated or insured under a family automobile policy, standard automobile policy, personal automobile policy or similar private passenger automobile policy written for personal use, including use by an insured of a motor vehicle in the course of the insured's volunteer work for a tax-exempt organization as described in section 501(c)(3) of the internal revenue code, as opposed to a motor vehicle rated or insured under a commercial automobile policy. 4. "Send", "sending" or "sent" means to deliver by United States mail, personal delivery or fax or by electronic means consistent with the requirements of section 20-239. 5. "Volunteer work" means work performed without compensation other than reimbursement of actual expenses incurred, or disbursement of meals or other incidental benefits. 20-118. Prohibition; definitions A. A person subject to this title shall not restrict or prohibit, by means of a policy or contract, whether written or otherwise, a licensed health care professional's good faith communication with the health care professional's patient concerning the patient's health care or medical needs, treatment options, health care risks or benefits. B. A person subject to this title shall not terminate a contract with or refuse to renew a contract with a health care professional solely because the health care professional in good faith does any of the following: 1. Advocates in private or in public on behalf of a patient. 2. Assists a patient in seeking reconsideration of a decision made by the person to deny coverage for a health care service. 3. Reports a violation of law to an appropriate authority. C. For the purposes of this section: 1. "Contract" means a written contract under which a licensed health care professional agrees to provide specified health care services to covered persons. Contract does not include a contract of salaried employment. 2. "Health care professional" has the same meaning prescribed in section 20-3151. 3. "Person" includes a service corporation subject to chapter 4, article 3 of this title and a health care services organization subject to chapter 4, article 9 of this title. 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. 20-120. Payment bonds for third party intermediary entities; contract provisions; definitions A. A health care insurer shall not contract with a third party intermediary entity for the delivery or provision of health benefits or services by or through that entity to a group or panel of covered persons, unless the third party intermediary entity at its own expense secures a payment bond or posts a cash deposit pursuant to this section. B. The following apply to a payment bond required by this section: 1. The payment bond shall be in a face amount that is at least equal to the average monthly payment amount that the third party intermediary entity is entitled to receive under the terms of its contract with the health care insurer. 2. The payment bond shall be executed by a surety company or companies holding a certificate of authority to transact surety business in this state issued by the director pursuant to chapter 2, article 1 of this title. 3. The payment bond serves solely as a source of payment of claims for covered health benefits or services provided by subcontracted health care professionals to the group or panel of covered persons under the contract between the third party intermediary entity and the health care insurer. 4. A subcontracted health care professional who has provided covered health care benefits or services to one or more covered persons under a subcontract with a third party intermediary entity, and who has not been paid in full for the covered benefits or services provided pursuant to the subcontract within ninety days after the date on which the last of the benefits or services were provided, may sue on the payment bond for the unpaid amount owed under the subcontract, may prosecute the action to final judgment and may execute on the judgment against the payment bond. The suit shall commence within one year after the date on which the last of the benefits or services sued for were provided. 5. A health care insurer that pays claims of subcontracted health care professionals for covered health care benefits or services that were the contractual responsibility of a third party intermediary entity may sue on the payment bond for the claims amounts paid, may prosecute the action to final judgment and may execute on the judgment against the payment bond. The suit shall commence within one year after the date on which the last of the claims sued for were paid. 6. The payment bond shall include a provision allowing the prevailing party in a suit on the bond to recover as a part of the judgment a reasonable attorney fee as determined by the court. 7. A health care insurer shall review annually a payment bond secured pursuant to this section to determine whether the face amount of the payment bond needs to be adjusted. C. The following apply to cash deposits required by this section: 1. A cash deposit posted pursuant to this section shall be in an amount that is at least equal to the average monthly payment amount that the third party intermediary entity is entitled to receive under the terms of its contract with the health care insurer and shall be deposited with and held in trust by the state treasurer. 2. Instead of requiring a third party intermediary to post the entire cash deposit at the outset, for a six month period beginning with the initial contract payment, the health care insurer may withhold from the monthly contract payment to be made to the third party intermediary entity an amount that is equal to one-sixth of the cash deposit required to be posted pursuant to this subsection. The health care insurer shall transfer the monies withheld pursuant to this subsection for deposit with the state treasurer to be held in trust as provided in this section. Monies withheld and not yet deposited with the state treasurer pursuant to this subsection are held in trust for the purposes described in this section and are not the monies of the health care insurer. 3. A cash deposit made pursuant to this section serves solely as a source of payment of claims for covered health benefits or services provided by subcontracted health care professionals to the group or panel of covered persons under the contract between the third party intermediary entity and the health care insurer. 4. A subcontracted health care professional who has provided covered health care benefits or services to one or more covered persons under a subcontract with a third party intermediary entity and who has not been paid in full for the provided benefits or services pursuant to the subcontract within ninety days after the date on which the last of the benefits or services were provided, may sue on the cash deposit for the unpaid amount owed under the subcontract, may prosecute the action to final judgment and may execute on the judgment against the cash deposit. The suit shall commence within one year after the date on which the last of the benefits or services sued for were provided. 5. A health care insurer that pays claims of subcontracted health care professionals for covered health care benefits or services that were the contractual responsibility of a third party intermediary entity may sue on the cash deposit for the claims amounts paid, may prosecute the action to final judgment and may execute on the judgment against the cash deposit. The suit shall not commence before one year after the date on which the last of the claims sued for were paid. 6. Out of monies held on deposit by the state treasurer for a specific third party intermediary entity pursuant to this section, monies may be awarded and paid to the prevailing party in a suit on the cash deposit. The court may award as a part of the judgment on that cash deposit a reasonable attorney fee as determined by the court. 7. A health care insurer shall review annually a cash deposit posted pursuant to this section to determine whether the face amount needs to be adjusted. D. The following apply to contracts between a third party intermediary entity and a health care insurer: 1. The contract shall require the third party intermediary entity to submit a quarterly report on the timeliness of payments made to all subcontracted health care professionals to the health care insurer to measure compliance with payment timeliness standards. 2. The contract shall require the third party intermediary entity to pay its subcontracted health care professionals within the time period specified under section 20-3102. E. This section does not: 1. Authorize any entity that does not hold a certificate of authority to engage in the business of insurance in this state. 2. Require a third party intermediary entity to post a payment bond or cash deposit if the entity holds a certificate of authority as an administrator, disability insurer, service corporation or health care services organization. 3. Create any new private right or cause of action for or on behalf of any person, other than a right to sue on a payment bond or cash deposit under subsection B or C of this section. A general creditor or judgment creditor or any other claimant of a third party intermediary entity shall not levy on any payment bond or cash deposit secured or held pursuant to this section. 4. Require a third party intermediary entity that serves as a provider network for an affiliated staff or group model health care services organization under a common line of ownership or control to post a payment bond or cash deposit to that health care services organization. Notwithstanding that a payment bond or cash deposit is not required under this paragraph, the health care services organization may require the third party intermediary entity to meet other payment bond or cash deposit requirements established by the health care services organization. If the health care services organization does not require the third party intermediary entity to post a payment bond or cash deposit, the health care services organization is responsible for payment of claims for covered health benefits or services that are provided by subcontracted health care professionals to covered persons if the third party intermediary entity fails to make payment pursuant to the subcontracts. 5. Require one or more persons who are licensed health care professionals, hospitals or other institutional health care providers to post a payment bond or cash deposit under a contract where the assumption of business risk is limited to benefits or services that may be lawfully furnished within the lawful scope of practice by that person or persons. 6. Limit the ability of a health care insurer to impose additional financial requirements on a third party intermediary entity. 7. Require a third party intermediary entity to post a payment bond or cash deposit if the entity has not been delegated responsibility to process and pay the claims of the health care providers for which the entity has assumed the business risk. F. Any bond that is secured or deposit that is posted under this section shall be released and returned: 1. To the third party intermediary entity on extinguishment by reinsurance or otherwise of substantially all liability of the insurer for the security of which the bond or deposit is held. 2. To the third party intermediary entity to the extent the bond or deposit is more than the amount required. 3. On proper order of a court of competent jurisdiction to the receiver, conservator, rehabilitator or liquidator of the third party intermediary entity or to any other properly designated official or officials who succeed to the management and control of the third party intermediary entity's assets. G. A surety shall not terminate a bond issued pursuant to this section unless the surety files a written notice of termination with the director at least thirty days before terminating the bond. H. A release of deposited monies shall not be made except on application to and the written order of the director. The director is not personally liable for the good faith release of all or any part of a deposit. I. A third party intermediary entity shall approve or deny claims in the manner prescribed in chapter 20 of this title. J. This section applies to all contracts between third party intermediary entities and health care insurers that are entered into or renewed from and after December 31, 2000. K. For the purposes of this section: 1. "Administrator" means an entity that holds a certificate of authority pursuant to chapter 2, article 9 of this title. 2. "Covered persons" means enrollees, insureds, members, subscribers, dependents or other persons who are covered by a contract of disability insurance, subscription contract, evidence of coverage or other prepaid plan or arrangement with a health care insurer. 3. "Health care insurer" means a disability insurer, service corporation or health care services organization. 4. "Health care professional" has the same meaning prescribed in section 20-3151. 5. "Health care services organization" means an entity that holds a certificate of authority pursuant to chapter 4, article 9 of this title. 6. "Service corporation" means an entity that holds a certificate of authority pursuant to chapter 4, article 3 of this title. 7. "Third party intermediary entity" means an entity that assumes business risk through a written contract with a disability insurer, service corporation or health care services organization for the cost of providing covered health care benefits or services to a group or panel of covered persons if not all of those benefits or services will be provided by the entity or by licensed health care professionals who are subcontracted to the entity. 20-121. Health care exchange; abortion coverage; prohibition; exceptions A. Consistent with the provisions of the patient protection and affordable care act (P.L. 111-148), any qualified health insurance policy, contract or plan offered through any health care exchange operating in this state shall not provide coverage for abortions. B. Subsection A of this section does not apply to coverage for any abortion: 1. That is necessary to save the life of the woman having the abortion. 2. That is necessary to avert substantial and irreversible impairment of a major bodily function of the woman having the abortion. 3. When the pregnancy is the result of rape or incest. 20-122. Health care sharing ministries; exemption from regulation; definition A. A health care sharing ministry's practices do not constitute the transaction of insurance business in this state for the purposes of regulation under this title. B. For the purposes of this section, "health care sharing ministry" means a nonprofit organization that is exempt from federal income tax under section 501 of the internal revenue code and that: 1. Limits its participants to those who share a common set of ethical or religious beliefs. 2. Meets the requirements of 26 United States Code section 5000A(d)(2)(B)(i) and (ii)(I), (II), (III) and (V). 3. Acts as a facilitator among participants who have financial or medical needs and matches those participants with other participants who have the ability to assist those with financial or medical needs consistent with the criteria established by the health care sharing ministry. 4. Provides for the financial and medical needs of a participant through contributions from one participant to another. 5. Suggests amounts that participants may contribute with no assumption of risk or promise to pay among the participants and no assumption of risk or promise to pay by the health care sharing ministry to the participants. 6. Provides a written monthly statement to all participants that lists the total dollar amount of qualified needs submitted to the health care sharing ministry and the amount actually published or assigned to participants for their contribution. 7. Provides a written disclaimer on or accompanying all applications and guideline materials distributed by or on behalf of the ministry that reads, in substance: Notice: The organization facilitating the sharing of medical expenses is not an insurance company and the ministry's guidelines and plan of operation are not an insurance policy. Whether anyone chooses to assist you with your medical bills will be completely voluntary because participants are not compelled by law to contribute toward your medical bills. Therefore, participation in the ministry or a subscription to any of its documents should not be considered to be insurance. Regardless of whether you receive any payment for medical expenses or whether this ministry continues to operate, you are always personally responsible for the payment of your own medical bills. 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. 20-124. Adoption of rules The director may adopt rules for the administration of title 6, title 32, chapters 9 and 36, title 41, chapter 31 and title 44, chapter 2.1. 20-125. Sending notices and correspondence For the purposes of this title, if a notice or correspondence is sent by: 1. Mail, the sender must send the notice or correspondence to the recipient's last known mailing address on file with the insurer. 2. Electronic means, the sender must send the notice or correspondence to the recipient's last known email address as provided by the recipient to the insurer. 20-126. Annual dental loss ratio report; posting; definitions A. Beginning July 1, 2024 and on or before July 1 of each year thereafter, each dental insurer doing business in this state shall file with the department on a standard form issued by the department an annual report on the dental loss ratio for the preceding calendar year. The dental loss ratio annual report shall include the following: 1. A combined dental loss ratio percentage for all individual dental policies. 2. A combined dental loss ratio percentage for all group dental policies issued to fully insured groups. B. Not later than August 1 of each year, the department shall post the reported dental loss ratios for each dental insurer on the department's website in a manner that is easily located and identifiable to the public. The department may not post the underlying claims, premiums and other data used to calculate the dental loss ratios and shall treat all claims, premiums and other data as confidential. C. For the purposes of this section: 1. "Adjusted incurred annual dental claims" means claims that were incurred for services rendered during the preceding calendar year and paid through March 31 of the following year and liability for claims incurred for services rendered during the preceding calendar year that have not been reported or paid through March 31 of the following calendar year. 2. "Dental insurer" means a dental service corporation pursuant to chapter 4, article 3 of this title, prepaid dental plan organization pursuant to chapter 4, article 7 of this title, health care services organization pursuant to chapter 4, article 9 of this title, disability insurer pursuant to chapter 6, article 4 of this title or group or blanket disability insurer pursuant to chapter 6, article 5 of this title that offers, issues or renews a contract, evidence of coverage or policy covering dental services. 3. "Dental loss ratio percentage" means the ratio, stated as a percentage, of the numerator as prescribed in subdivision (a) of this paragraph to the denominator as prescribed in subdivision (b) of this paragraph. (a) The numerator is the sum of all of the following: (i) The adjusted incurred annual dental claims in this state. (ii) The amount spent by a dental insurer on activities that improve the quality of dental care but does not include expenses for advertising, promotions or donations to charitable foundations. (iii) The amount of claims identified through fraud reduction efforts. (b) The denominator is the sum of the annual dental insurance premiums earned in this state, excluding: (i) The annual incurred federal and state taxes, licensing fees and regulatory fees on dental premiums in this state. (ii) The annual federal income taxes attributed to the dental line of business for the reporting year. 4. "Dental policies" means a contract, evidence of coverage or policy covering dental services, excluding: (a) A policy, subscription contract, group or blanket disability insurer contract or evidence of coverage that includes dental benefits that are included in the medical benefits of a policy and not administered as stand-alone dental benefits. (b) A self-funded employer group health or dental plan. (c) A plan or group of plans covering dental services for which a dental insurer does not have credible experience, as determined by the director. 20-127. Fire insurance review task force; membership; duties; annual report; public posting (Rpld. 1/1/28) A. The fire insurance review task force is established in the department and consists of the following members: 1. The director of the department or the director's designee, who shall serve as chairperson of the task force. 2. Two members who are appointed by the director, one of whom is an employee of an insurance company that represents the homeowners insurance industry. 3. One member who is appointed by the director of the department and who represents a wildfire risk reduction organization that is informed on wildfire risk. 4. The state forester or the state forester's designee, who shall serve as vice chairperson of the task force. 5. Four members who are appointed by the state forester and who have expertise in wildfire areas and wildfire prevention and mitigation. B. Appointed members serve two-year terms beginning and ending on the third Monday in January and may be reappointed for not more than two consecutive terms. On the expiration of a member's term, the member may continue to serve until that member is reappointed to another term or a new member is appointed. C. Any vacancy in the membership shall be filled in the same manner as the original appointment. D. The department shall provide the task force with both of the following: 1. The annual aggregated and deidentified insurance premium and policy coverage data reported by insurers pursuant to section 20-123. 2. The total number of consumer complaints for the calendar year that is related to nonrenewal or cancellation of homeowners policies due to risk of fire loss and related to increases in homeowners insurance premiums. E. The task force shall: 1. Review the data received from the department. 2. Identify possible current and historic trends in homeowners coverage availability, insurance rates, nonrenewal and cancellation. 3. Review data related to fire risk mitigation science and make recommendations related to building codes, defensible space requirements and ordinances that reduce the risk of wildfire. F. The task force may establish ad hoc work groups to carry out the purposes of this section and consult with experts in the field of wildfire risks and the impact of wildfires and wildfire risk on homeowners insurance premiums. G. The task force shall hold at least four meetings per calendar year. H. Task force members are eligible to receive reimbursement of expenses under title 38, chapter 4, article 2. I. On or before December 31 of each year, the task force shall submit a report of its findings and recommendations to the governor, the speaker of the house of representatives, the president of the senate, the minority leader of the house of representatives and the minority leader of the senate and shall provide a copy of this report to the secretary of state and the department. The director shall post the report on the department's website. 20-141. Director of the department of insurance and financial institutions; appointment; qualifications; compensation A. The governor shall appoint a director of the department of insurance and financial institutions pursuant to section 38-211. B. The director shall: 1. Serve at the pleasure of the governor. 2. Be a person with business experience, including being well versed in insurance and financial institution matters. 3. Receive compensation as determined pursuant to section 38-611. 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. 20-143. Rule-making power A. The director may make reasonable rules necessary for effectuating any provision of this title. B. The director shall make rules concerning proxies, consents or authorizations in respect of securities issued by domestic stock insurance companies having a class of equity securities held of record by one hundred or more persons to conform with the requirements of section 12(g)(2)(G)(ii) of the securities exchange act of 1934, as amended, and as may be amended. Such rule shall not apply to any such company having a class of equity securities which are registered or are required to be registered pursuant to section 12 of the securities exchange act of 1934, as amended, or as may be amended. Whenever such equity securities of any such company are registered or are required to be registered pursuant to section 12 of the securities exchange act of 1934, as amended, or as may be amended, then, no person shall solicit or permit the use of his name to solicit, in any manner whatsoever, any proxy, consent or authorization in respect of any equity security of such company without having first complied with the rules prescribed by the securities and exchange commission pursuant to section 14 of the securities exchange act of 1934, as amended, or as may be amended. C. All rules made pursuant to this section shall be subject to title 41, chapter 6. D. In addition to any other penalty provided, wilful violation of any rule made by the director is a violation of this title. 20-144. Seal of office A. The director shall have a seal of office consisting of the shield as used in the great seal of the state of Arizona encircled by the words "director of the department of insurance and financial institutions, state of Arizona." B. Every certificate or license issued by the director shall bear the director's seal. 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. 20-146. Supervisor A. The director shall appoint a supervisor of insurance rates. B. The supervisor of insurance rates shall be a person versed in insurance rating procedure and familiar with the operation of insurance companies and rating organizations. C. The supervisor shall be subject to removal for cause. D. The supervisor of insurance rates shall receive compensation as determined pursuant to section 38-611. 20-147. Assistant director; chief examiner; appointment; qualifications A. The director shall appoint an assistant director and a chief examiner. B. The assistant director shall be experienced in the fields of life and disability and property and casualty insurance and the chief examiner shall have had at least five years' experience as a full-time examiner for a state insurance department or departments, or as a full-time staff member of a public accounting or actuarial firm regularly employed to conduct examinations for a state insurance department. 20-148. Deputies and other employees; special services A. Subject to title 41, chapter 4, article 4, the director shall appoint such other deputies, assistants and clerks, as necessary properly to discharge the duties imposed upon the director under this title. B. The director may from time to time contract for and procure, on a fee or part time basis, or both, such actuarial, technical and other professional services as he may require for the operation of his office. C. The compensation of each deputy, actuary, assistant and clerk shall be as determined pursuant to section 38-611. 20-149. Prohibition on certain activities by employees; conflict of interest A. The director, or any deputy, examiner, assistant or employee of the director shall not be financially interested, directly or indirectly, in any insurer, agency or any entity regulated under this title except as a policyholder or claimant under a policy. As to such matters wherein a conflict of interests does not exist on the part of any such individual, the director may employ from time to time insurance actuaries or other technicians who are independently practicing their professions even though similarly employed by insurers and others. B. The director or any deputy, examiner, assistant or employee of the director shall not be given nor receive any fee, compensation, loan, gift or other thing of value in addition to the compensation provided by law for any service rendered or to be rendered as such director, deputy or employee or in connection therewith. C. This section shall not be deemed to prohibit employment by the director of retired or pensioned personnel of insurers or insurance organizations. D. The director, or any deputy, examiner, assistant or employee of the department whose relative is an owner, partner, director, officer, holder of a beneficial interest of more than five per cent whether as a shareholder or otherwise or a salaried employee of any entity regulated under this title shall be subject to the conflict of interest and disclosure requirements set forth in title 38, chapter 3, article 8. E. For purposes of subsection D, the term "relative" shall include all persons set forth in section 38-502, paragraph 9. 20-150. Delegation of director's authority A. Any power, duty or function, whether ministerial or discretionary, vested by this title in the director may be exercised or discharged by any deputy, assistant or examiner or by any other person designated by the director pursuant to section 20-148 acting in the director's name and by his delegated authority. B. The director shall be responsible for the official acts of his deputy, assistant, examiner or employee or any other person designated by the director pursuant to section 20-148 acting in the director's name and by his authority. 20-151. Issuance of orders and notices by director A. Orders and notices of the director are not effective unless the orders and notices are in writing and signed by the director or by the director's authority. B. Every order of the director shall state its effective date and shall concisely state: 1. Its intent or purpose. 2. The grounds on which the order is based. 3. The provisions of this title pursuant to which action is so taken or proposed to be taken, but failure to so designate any provision shall not deprive the director of the right to rely on the provision. C. The department may send orders and notices in accordance with section 20-117, paragraph 4. If the department sends an order or notice by mail, the department shall send the order or notice, postage prepaid, to the recipient's principal place of business as last of record in the director's office. 20-152. Enforcement A. If the director has cause to believe that a person has violated any penal provision of this title or other laws relating to insurance, and that prosecution of the person is advisable, he shall certify the facts of such violation to the attorney general, who shall bring and prosecute such action as may be required for the purpose of punishing the violation. B. If the director has cause to believe that any person is violating or is about to violate any provision of this title or any lawful order of the director, he may certify the facts thereof to the attorney general, who shall bring and prosecute such action as may be required for the purpose of enjoining the violation. C. The attorney general shall prosecute or defend all proceedings brought pursuant to or resulting from enforcement of this title when requested by the director. 20-153. Records A. Records of all official transactions, examinations, investigations and proceedings of the department shall be open to public inspection pursuant to section 39-121, except as otherwise provided in this title. B. The director may destroy records pursuant to sections 41-151.15 and 41-151.19. 20-154. Annual report; list of authorized insurers A. As early in the calendar year as possible the director shall annually prepare a report for delivery to the commission, the governor and the legislature, showing, with respect to the preceding calendar year: 1. List of authorized insurers transacting insurance in this state, with such report of their financial condition as he deems appropriate. 2. Names of insurers whose businesses were closed during the year, the cause thereof, and amount of assets and liabilities as ascertainable. 3. Names of insurers against which delinquency or similar proceedings were instituted, and a concise statement of the facts with reference to each such proceeding. 4. Name and compensation of each officer, deputy, examiner, assistant and employee of the office of director, and the whole amount, with reasonable itemization, of the expenses of the office