Bill Text: AZ HB2047 | 2014 | Fifty-first Legislature 2nd Regular | Chaptered
Bill Title: Travel insurance producer licensing
Spectrum: Partisan Bill (Republican 3-0)
Status: (Passed) 2014-04-15 - Chapter 24 [HB2047 Detail]
Download: Arizona-2014-HB2047-Chaptered.html
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House Engrossed |
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State of Arizona House of Representatives Fifty-first Legislature Second Regular Session 2014
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CHAPTER 24
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HOUSE BILL 2047 |
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AN ACT
Amending sections 20‑281 and 20‑288, Arizona Revised Statutes; amending title 20, chapter 2, article 3.3, Arizona Revised Statutes, by adding section 20‑333; relating to limited lines travel insurance.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Section 20-281, Arizona Revised Statutes, is amended to read:
20-281. Definitions
In this article, unless the context otherwise requires:
1. "Business entity" means any corporation, association, partnership, limited liability company, limited liability partnership or other legal entity except an individual or sole proprietorship.
2. "Designated producer" means the individual insurance producer that a business entity designates pursuant to section 20‑285, subsection C, paragraph 3 as the individual responsible for the business entity's compliance with the insurance laws of this state.
3. "Health or sickness insurance" means disability insurance as defined in section 20‑253.
4. "Home state" means the District of Columbia and any state or territory of the United States in which:
(a) An individual insurance producer maintains a principal place of residence or principal place of business and is licensed to act as a resident insurance producer.
(b) A business entity insurance producer maintains its principal place of business and is licensed to act as a resident insurance producer.
5. "Insurance producer" means a person required to be licensed under this article to sell, solicit or negotiate insurance.
6. "Limited line credit insurance" means any form of insurance that is offered in connection with an extension of credit and that is limited to partially or wholly extinguishing that credit obligation, including credit life, credit disability, credit property, credit unemployment, involuntary unemployment, mortgage life, mortgage guaranty, mortgage disability, guaranteed asset or automobile protection insurance and any other form of insurance that is offered in connection with an extension of credit, that is limited to partially or wholly extinguishing that credit obligation and that the director determines should be designated a form of limited line credit insurance.
7. "Limited line insurance" means limited line credit insurance, travel accident ticket and baggage insurance limited lines travel insurance under section 20‑333 and any other line of insurance that the director deems necessary to recognize for the purposes of complying with section 20‑287, subsection C, paragraph 2.
8. "Major line insurance" means life insurance, accident and health or sickness insurance, property insurance, casualty insurance, personal lines insurance and variable insurance contracts, as described in section 20‑286.
9. "Member" means, if used in reference to a business entity, a person that holds an ownership interest in the business entity, excluding any interest in publicly traded securities and any interest of less than ten per cent of the voting rights.
10. "Negotiate" means the act of conferring directly with or offering advice directly to a purchaser or prospective purchaser of a particular contract of insurance concerning any of the substantive benefits, terms or conditions of the contract if the person engaged in that act either sells insurance or obtains insurance from insurers for purchasers.
11. "Nonresident" means a person whose home state is not Arizona.
12. "Person" means an individual or a business entity.
13. "Resident" means a person whose home state is Arizona and who does not hold a resident insurance producer license in another state or territory of the United States or in the District of Columbia.
14. "Sell" means to exchange a contract of insurance by any means, for money or its equivalent, on behalf of an insurer.
15. "Solicit" means attempting to sell insurance or asking or urging a person to apply for a particular kind of insurance from a particular company.
16. "Travel accident ticket and baggage insurance producer" means a ticket selling agent or other representative of a common carrier who solicits or sells only over‑the‑counter, short‑term, nonrenewable travel accident, ticket and baggage insurance.
Sec. 2. Section 20-288, Arizona Revised Statutes, is amended to read:
20-288. Exemption from examination
A. An individual who applies for an insurance producer license in this state and who was previously licensed for the same lines of authority in another state is not required to take an examination if either:
1. The applicant is currently licensed in the other state.
2. The application is received within ninety days after the cancellation of the applicant's previous license and the other state issues a certification that, at the time of cancellation, the applicant was in good standing in that state, or other reliable information available to the director indicates that the applicant is or was licensed in good standing for the line of authority requested.
B. The following applicants are not required to take an examination:
1. An applicant for timely renewal of a license.
2. An applicant for the same type of license that covers the same lines of authority for which the applicant was licensed in this state, other than under a temporary license, within the twelve months preceding the date of application.
3. An applicant who is a ticket selling agent or any other representative of a common carrier for a limited line license that covers the sale of travel accident ticket policies or baggage insurance for a limited lines travel insurance producer business entity license, or a travel retailer working under the travel insurance producer business entity license, that is issued pursuant to section 20‑333.
4. An applicant for a license as a nonresident insurance producer who meets the requirements of section 20‑287, subsection A.
5. An applicant for a rental car agent license that is issued pursuant to section 20‑331.
6. An applicant for a self‑service storage agent license that is issued pursuant to section 20‑332.
Sec. 3. Title 20, chapter 2, article 3.3, Arizona Revised Statutes, is amended by adding section 20-333, to read:
20-333. Limited lines travel insurance producer business entity license; requirements; travel retailers; definitions
A. Notwithstanding any other provision of this title, a travel retailer may offer and issue travel insurance under a limited lines travel insurance producer business entity license under the following conditions:
1. The limited lines travel insurance producer or travel retailer provides to purchasers of travel insurance all of the following:
(a) A description of the material terms or the actual material terms of the insurance coverage.
(b) A description of the process for filing a claim.
(c) A description of the review or cancellation process for the travel insurance policy.
(d) The identity and contact information of the insurer and limited lines travel insurance producer.
2. At the time of licensure, the limited lines travel insurance producer establishes and maintains a register, on a form prescribed by the director, of each travel retailer that offers travel insurance on the limited lines travel insurance producer's behalf. The limited lines travel insurance producer shall maintain and annually update the register, which shall include the name, address and contact information of the travel retailer and an officer or person who directs or controls the travel retailer's operations, and the travel retailer's federal tax identification number. The limited lines travel insurance producer shall submit the register to the department within thirty days after a request. The limited lines travel insurance producer shall also certify to the department that the registered travel retailer is not in violation of 18 United states code section 1033.
3. The limited lines travel insurance producer designates one of the producer's employees who is a licensed individual producer as the person responsible for the limited lines travel insurance producer's compliance with the travel insurance laws and rules of this state.
4. The licensed individual producer designated under paragraph 3 of this subsection complies with the fingerprinting requirements applicable to insurance producers in the resident state of the limited lines travel insurance producer.
5. The limited lines travel insurance producer pays all applicable insurance producer licensing fees required under this title.
6. The limited lines travel insurance producer requires each employee or authorized representative of the travel retailer whose duties include offering and disseminating travel insurance to receive a training or an instruction program, which may be subject to review by the director. The training material, at a minimum, shall contain instructions on the types of insurance offered, ethical sales practices and required disclosures to prospective customers.
B. Limited lines travel insurance producers and those registered under the producer's license are exempt from the examination requirements under this chapter and the continuing education requirements under chapter 18 of this title.
C. Any travel retailer offering or disseminating travel insurance shall make available to prospective purchasers brochures or other written materials that:
1. Provide the identity and contact information of the insurer and the limited lines travel insurance producer.
2. Explain that the purchase of travel insurance is not required in order to purchase any other product or service from the travel retailer.
3. Explain that an unlicensed travel retailer is permitted to provide general information about the insurance offered by the travel retailer, including a description of the coverage and price, but is not qualified or authorized to answer technical questions about the terms and conditions of the insurance offered by the travel retailer or to evaluate the adequacy of the customer's existing insurance coverage.
D. A travel retailer's employee or authorized representative who is not licensed as an insurance producer may not do any of the following:
1. Evaluate or interpret the technical terms, benefits and conditions of the offered travel insurance coverage.
2. Evaluate or provide advice concerning a prospective purchaser's existing insurance coverage.
3. Hold himself out as a licensed insurer, licensed producer or insurance expert.
E. A travel retailer whose insurance‑related activities, and those of the retailer's employees and authorized representatives, are limited to offering and disseminating travel insurance under the limitations of this section may receive related compensation on registration by the limited lines travel insurance producer pursuant to subsection A, paragraph 2 of this section.
F. Travel insurance may be provided under an individual policy or under a group or master policy.
G. As the insurer designee, the limited lines travel insurance producer is responsible for the acts of the travel retailer and shall use reasonable means to ensure compliance by the travel retailer with the requirements of this section.
H. To the extent not inconsistent with this article, section 20‑281, section 20‑286, subsections B, C and D, sections 20‑289 and 20‑289.01, section 20‑290, subsection A and sections 20‑291, 20‑292, 20‑295, 20‑296, 20‑297, 20‑298, 20‑299, 20‑301 and 20‑302 apply to a limited lines travel insurance producer and any travel retailer offering and disseminating travel insurance under the limited lines travel insurance producer business entity license.
I. For the purposes of this section:
1. "Limited lines travel insurance producer" means a business entity that is either:
(a) A managing general agent.
(b) A licensed insurance producer, including a limited lines producer, designated by an insurer as the travel insurance supervising entity.
2. "offer and disseminate" means providing general information, including a description of the coverage and price, as well as processing the application, collecting premiums and performing other non‑licensable activities permitted by the department.
3. "Travel insurance":
(a) Means insurance coverage for personal risks incident to planned travel, including:
(i) Interruption or cancellation of a trip or event.
(ii) Loss of baggage or personal effects.
(iii) Damages to accommodations or rental vehicles.
(iv) Sickness, accident, disability or death occurring during travel.
(b) Does not include major medical plans, which provide comprehensive medical protection for travelers with trips lasting six months or longer, including those working overseas as expatriates or military personnel being deployed.
4. "Travel retailer" means a business entity that makes, arranges or offers travel services and that may offer and disseminate travel insurance as a service to its customers on behalf of and under the direction of a limited lines travel insurance producer.
APPROVED BY THE GOVERNOR APRIL 15, 2014.
FILED IN THE OFFICE OF THE SECRETARY OF STATE APRIL 15, 2014.
