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| Home > Statutes > Usa Arizona |
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USA Statutes : arizona
Title : Insurance
Chapter : THE INSURANCE CONTRACT
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20-1101 Scope of article
This article shall not apply to:
1. Reinsurance.
2. Policies or contracts not issued for delivery in this state nor delivered in
this state, except as provided in section 20-1110, subsection G (approval of forms for
delivery in jurisdictions where local approval not provided for) and in section 20-1133,
subsection A (medicare supplement insurance minimum standards).
3. Ocean marine and foreign trade insurances.
4. Title insurance, except as to section 20-1115.
20-1102 "Policy" defined "Policy" means contract of or agreement for or effecting insurance, or the certificate thereof, by whatever name called, and includes all clauses, riders, endorsements and papers attached thereto and a part thereof. 20-1103 "Premium" defined "Premium" is the consideration for insurance, by whatever name called. 20-1104 Insurable interest with respect to personal insurance; definition
A. Any individual of competent legal capacity may procure or effect an insurance
contract upon his own life or body for the benefit of any person. But no person shall
procure or cause to be procured any insurance contract upon the life or body of another
individual unless the benefits under such contract are payable to the individual insured
or his personal representatives, or to a person having, at the time when the contract was
made, an insurable interest in the individual insured.
B. If the beneficiary, assignee or other payee under any contract made in violation
of this section receives from the insurer any benefits thereunder accruing upon the
death, disablement or injury of the individual insured, the individual insured or his
executor or administrator, as the case may be, may maintain an action to recover such
benefits from the person so receiving them.
C. "Insurable interest" with reference to personal insurance includes only
interests as follows:
1. In the case of individuals related closely by blood or by law, a substantial
interest engendered by love and affection.
2. In the case of other persons, a lawful and substantial economic interest in
having the life, health or bodily safety of the individual insured continue, as
distinguished from an interest which would arise only by, or would be enhanced in value
by, the death, disablement or injury of the individual insured.
3. An individual party to a contract or option for the purchase or sale of an
interest in a business partnership or firm, or of shares of stock of a closed corporation
or of an interest in the shares, has an insurable interest in the life of each individual
party to the contract and for the purposes of the contract only, in addition to any
insurable interest which may otherwise exist as to the life of the individual.
4. A charitable organization as provided in section 43-1201, paragraph 4, which has
a policy ownership interest has an insurable interest in the life of each proposed
insured who joins with the charitable organization in applying for a life insurance
policy naming the charitable organization as owner and irrevocable beneficiary.
20-1105 Insurable interest with respect to property insurance
A. No insurance contract on property or of any interest therein or arising
therefrom shall be enforceable as to the insurance except for the benefit of persons
having an insurable interest in the things insured.
B. "Insurable interest" as used in this section means any actual, lawful and
substantial economic interest in the safety or preservation of the subject of the
insurance free from loss, destruction or pecuniary damage or impairment.
C. The measure of an insurable interest in property is the extent to which the
insured might be damaged by loss, injury or impairment thereof.
20-1106 Capacity to contract for insurance; minors
A. Any person of competent legal capacity may contract for insurance.
B. A minor not less than fifteen years of age as of his nearest birthday may,
notwithstanding his minority, contract for life or disability insurance on his own life
or body, for his own benefit or for the benefit of his father or mother, spouse, child,
brother, sister or grandparents. The minor shall, notwithstanding his minority, be
deemed competent to exercise all rights and powers with respect to or under any contract
of life or disability insurance on his own life or body, as though of full legal age, and
may surrender his interest therein and give a valid discharge for any benefit accruing or
money payable thereunder. The minor shall not, by reason of his minority, be entitled to
rescind, avoid or repudiate the contract, nor to rescind, avoid or repudiate any exercise
of a right or privilege thereunder, except that the minor, not otherwise emancipated,
shall not be bound by any unperformed agreement to pay, by promissory note or otherwise,
any premium on such an insurance contract.
20-1107 Application for insurance
No life or disability insurance contract upon an individual, except a contract of
group life insurance or of group or blanket disability insurance, shall be made or
effectuated unless at the time of making the contract the individual insured, being of
competent legal capacity to contract, applies therefor or consents thereto, except in the
following cases:
1. A spouse may effectuate such insurance upon the other spouse.
2. Any person having an insurable interest in the life of a minor, or any person
upon whom a minor is dependent for support and maintenance, may effectuate insurance upon
the life of or pertaining to the minor.
20-1108 Admissibility of application as evidence
A. No application for the issuance of any life or disability insurance policy or
contract shall be admissible in evidence in any action relative to such policy or
contract, unless a true copy of the application was attached to or otherwise made a part
of the policy when issued and delivered. This provision shall not apply to industrial
life insurance policies.
B. If any policy of life or disability insurance delivered in this state is
reinstated or renewed, and the insured or the beneficiary or assignee of the policy makes
written request to the insurer for a copy of the application, if any, for such
reinstatement or renewal, the insurer shall, within thirty days after receipt of the
request at its home office or at any of its branch offices, deliver or mail to the person
making the request a copy of the application. If the copy is not so delivered or mailed
after having been requested, the insurer shall be precluded from introducing the
application in evidence in any action or proceeding based upon or involving the policy or
its reinstatement or renewal.
C. As to kinds of insurance other than life insurance, no application for insurance
signed by or on behalf of the insured shall be admissible in evidence in any action
between the insured and the insurer arising out of the policy so applied for, if the
insurer has failed, at the expiration of thirty days after receipt by the insurer of
written demand therefor by or on behalf of the insured, to furnish to the insured a copy
of the application reproduced by any legible means.
20-1109 Statements as representation; effect of misrepresentation upon policy
All statements and descriptions in any application for an insurance policy or in
negotiations therefor, by or in behalf of the insured, shall be deemed to be
representations and not warranties. Misrepresentations, omissions, concealment of facts
and incorrect statements shall not prevent a recovery under the policy unless:
1. Fraudulent.
2. Material either to the acceptance of the risk, or to the hazard assumed by the
insurer.
3. The insurer in good faith would either not have issued the policy, or would not
have issued a policy in as large an amount, or would not have provided coverage with
respect to the hazard resulting in the loss, if the true facts had been made known to the
insurer as required either by the application for the policy or otherwise.
20-1110.01 Rules and regulations; form and readability of policies
A. The director shall adopt and promulgate rules and regulations governing the form
and readability of various types of insurance policies including title insurance
policies. Such rules and regulations may provide that the readability requirements
established pursuant to this subsection may be met by use of an outline of coverage or
brochure which accompanies the policy and is provided to the policyholder.
B. The rules and regulations adopted and promulgated by the director pursuant to
subsection A of this section shall neither require standardized forms of policies nor
mandate or prohibit the inclusion of any coverage provisions in policies issued in this
state.
20-1110 Approval of forms
A. Any life or disability insurance policy form, life or disability insurance
application form where written application is required and is to be made a part of the
policy and printed rider or endorsement form, shall not be delivered or issued for
delivery in this state by a life or disability insurer unless it has been filed with and
approved by the director. The director may also require that proof of death or loss forms
shall be filed with and approved by the director.
B. This section shall not apply to policies, riders, endorsements or forms of
unique character designed and used for insurance on a particular subject, or that relate
to the manner of distribution of benefits or to the reservation of rights and benefits
under life or disability insurance policies, and are used at the request of the
individual policyholder, contract holder or certificate holder.
C. Every filing shall be made not less than thirty days in advance of any delivery.
The form is approved thirty days after filing unless the director has, within the thirty
day period, issued an order affirmatively approving or disapproving the form. The
director may extend by not more than an additional fifteen days the period for review of
the form, by giving notice of the extension before expiration of the initial thirty day
period. The director may at any time, after notice and for cause shown, withdraw the
director's approval.
D. Any order of the director disapproving the form or withdrawing a previous
approval shall state the reasons for the action.
E. A life or disability insurer shall not issue or deliver any advertising matter
or sales material to any person in this state until the life or disability insurer files
the advertising matter or sales material with the director. This subsection does not
require a life or disability insurer to have the prior approval of the director to issue
or deliver the advertising matter or sales material. If the director finds that the
advertising matter or sales material, in whole or in part, is false, deceptive or
misleading, the director may issue an order disapproving the advertising matter or sales
material, directing the life or disability insurer to cease and desist from issuing,
circulating, displaying or using the advertising matter or sales material within a period
of time specified by the director but not less than ten days and imposing any penalties
prescribed in this title. At least five days before issuing an order pursuant to this
subsection, the director shall provide the life or disability insurer with a written
notice of the basis of the order to provide the life or disability insurer with an
opportunity to cure the alleged deficiency in the advertising matter or sales material
within a single five day period for the particular advertising matter or sales material
at issue. The life or disability insurer may appeal the director's order pursuant to
title 41, chapter 6, article 10. Except as otherwise provided in this subsection, a life
or disability insurer may obtain a stay of the effectiveness of the order as prescribed
in section 20-162. If the director certifies in the order and provides a detailed
explanation of the reasons in support of the certification that continued use of the
advertising matter or sales material poses a threat to the health, safety or welfare of
the public, the order may be entered immediately without opportunity for cure and the
effectiveness of the order is not stayed pending the hearing on the notice of appeal but
the hearing shall be promptly instituted and determined.
F. The director may, by order, exempt from the requirements of this section for so
long as the director deems proper any insurance document or form as specified in the
order, to which, in the director's opinion, this section may not practicably be applied,
or the filing and approval of which are, in the director's opinion, not desirable or
necessary for the protection of the public.
G. This section shall apply also to any form used by domestic insurers for delivery
in a jurisdiction outside this state, if the insurance supervisory official of that
jurisdiction informs the director that the form is not subject to approval or disapproval
by that official, and on the director's order requiring the form to be submitted to the
director for the purpose. The applicable same standards shall apply to these forms as
apply to forms for domestic use.
20-1111 Grounds for disapproval of forms
A. The director shall disapprove any form of policy, application, rider or
endorsement or withdraw any previous approval thereof only:
1. If it is in any respect in violation of or does not comply with this title.
2. If it contains or incorporates by reference any inconsistent, ambiguous or
misleading clauses, or exceptions and conditions which deceptively affect the risk
purported to be assumed in the general coverage of the contract.
3. If it has any title, heading or other indication of its provisions which is
misleading.
4. If the purchase of such policy is being solicited by false, deceptive or
misleading advertising matter, sales material or representations.
B. The director may disapprove any proof of death or loss form only if it imposes
unreasonable requirements, or is in violation of this title, or contains deceptive or
ambiguous matter.
C. The director may disapprove any advertising matter or sales material which is in
violation of this title.
20-1112 Standard provisions
A. Insurance contracts shall contain such standard provisions as are required by
the applicable provisions of this title pertaining to contracts of particular kinds of
insurance. The director may waive the required use of a particular standard provision in
a particular insurance policy form if he finds such provision unnecessary for the
protection of the insured and inconsistent with the purposes of the policy and the policy
is otherwise approved by him.
B. No policy shall contain any provision inconsistent with or contradictory to any
standard provision used or required to be used, but the director may approve any
substitute policy or provision which, when viewed in its entirety, is substantially
equivalent to or more favorable to the insured or beneficiary than the standard
provisions or optional standard provisions otherwise required.
C. In lieu of the standard provisions required by the provisions of this title for
contracts for particular kinds of insurance, substantially similar standard provisions
required by the law of the domicile of a foreign or alien insurer may be used when
approved by the director.
20-1113 Contents of policy
A. The written instrument in which a contract of insurance is set forth is the
policy.
B. Every policy shall specify:
1. The names of the parties to the contract.
2. The insurer's name.
3. The subject of the insurance.
4. The risks insured against.
5. The time when the insurance thereunder takes effect and the period during which
the insurance is to continue.
6. The premium.
7. The conditions pertaining to the insurance.
C. If under the policy the exact amount of premium is determinable only at stated
intervals or termination of the contract, a statement of the basis and rates upon which
the premium is to be determined and paid shall be included.
D. The provisions of subsections A, B and C shall not apply to surety contracts, or
to group insurance policies.
E. A policy may contain additional provisions not inconsistent with this title and
which are:
1. Required to be inserted by the laws of the insurer's domicile.
2. Necessary, on account of the manner in which the insurer is constituted or
operated, in order to state the rights and obligations of the parties to the contract.
3. Desired by the insurer and neither prohibited by law nor in conflict with any
provisions required to be included therein.
20-1114 Incorporation of charter or bylaw into policy
No policy shall contain any provision purporting to make any portion of the charter,
bylaws or other constituent document of the insurer a part of the contract unless such
portion is set forth in full in the policy. Any policy provision in violation of this
section shall be invalid.
20-1115 Void policy restrictions
A. No policy delivered or issued for delivery in this state and covering a subject
of insurance resident, located or to be performed in this state, shall contain any
condition, stipulation or agreement:
1. Requiring the policy to be construed according to the laws of any other state or
country, except as necessary to meet the requirements of the motor vehicle financial
responsibility laws or compulsory disability benefit laws of such other state or country.
2. Preventing the bringing of an action against the insurer for more than six
months after the cause of action accrues.
3. Limiting the time within which an action may be brought to a period of less than
two years from the time the cause of action accrues in connection with all insurances
other than property and marine and transportation insurances. In property and marine and
transportation policies such time shall be one year from the date of occurrence of the
event resulting in the loss except that an insurer may extend such limitation beyond one
year in its policy provisions.
B. Any such condition, stipulation or agreement shall be void, but such voidance
shall not affect the validity of the other provisions of the policy.
20-1116 Execution of policies
A. Every insurance policy shall be executed in the name of and on behalf of the
insurer by its officer, attorney-in-fact, employee or representative duly authorized by
the insurer.
B. A facsimile signature of any such executing individual may be used in lieu of an
original signature.
C. No insurance contract issued and which is otherwise valid shall be rendered
invalid by reason of the apparent execution thereof on behalf of the insurer by the
imprinted facsimile signature of an individual not authorized so to execute as of the
date of the policy, if the policy is countersigned with the original signature or initial
of an individual then so authorized.
20-1117 Underwriters' and combination policies
A. Two or more authorized insurers may jointly issue, and shall be jointly and
severally liable on, an underwriters' policy bearing their names. Any one insurer may
issue policies in the name of an underwriter's department and such policy shall plainly
show the true name of the insurer.
B. Two or more insurers may, with the approval of the director, issue a combination
policy which shall contain provisions substantially as follows:
1. That the insurers executing the policy shall be severally liable for the full
amount of any loss or damage, according to the terms of the policy, or for specified
percentages or amounts thereof, aggregating the full amount of insurance under the
policy.
2. That service of process, or of any notice or proof of loss required by such
policy, upon any of the insurers executing the policy, shall constitute service upon all
such insurers.
C. This section shall not apply to cosurety obligations.
20-1118 Validity of noncomplying forms
Any insurance policy, rider or endorsement issued after January 1, 1955 and
otherwise valid which contains any condition or provision not in compliance with the
requirements of this title shall not be thereby rendered invalid but shall be construed
and applied in accordance with such conditions and provisions as would have applied had
such policy, rider or endorsement been in full compliance with this title.
20-1119 Construction of policies
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.
20-1120 Binders
A. Binders or other contracts for temporary insurance may be made orally or in
writing, and shall be deemed to include all the usual terms of the policy as to which the
binder was given together with such applicable endorsements as are designated in the
binder, except as superseded by the clear and express terms of the binder.
B. No binder shall be valid beyond the issuance of the policy with respect to which
it was given, or beyond ninety days from its effective date, whichever period is the
shorter.
C. If the policy has not been issued a binder may be extended or renewed beyond
such ninety days with the written approval of the director, or in accordance with such
rules and regulations relative thereto as the director may promulgate.
D. This section shall not apply to life or disability insurances.
20-1121 Renewal of policy by certificate or endorsement
Any insurance policy terminating by its terms at a specified expiration date and not
otherwise renewable, may be renewed or extended at the option of the insurer upon a
currently authorized policy form at the premium rate then required therefor for a
specific additional period or periods by certificate or by endorsement of the policy, and
without requiring the issuance of a new policy.
20-1122 Assignment of policies
A policy may be assignable or not assignable, as provided by its terms. Subject to
its terms relating to assignability, any life or disability policy, when issued, under
the terms of which the beneficiary may be changed upon the sole request of the insured,
may be assigned either by pledge or transfer of title, by an assignment executed by the
insured alone and delivered to the insurer, whether or not the pledgee or assignee is the
insurer. Any such assignment shall entitle the insurer to deal with the assignee as the
owner or pledgee of the policy in accordance with the terms of the assignment until the
insurer has received at its home office written notice of termination of the assignment
or pledge, or written notice by or on behalf of some other person claiming some interest
in the policy in conflict with the assignment.
20-1123.01 Motor vehicle liability insurance; primary and excess coverage
A. If two or more policies affording valid and collectible automobile liability
insurance apply to the same motor vehicle in an occurrence out of which a liability loss
shall arise, and one of such policies affords coverage to a named insured engaged in the
business of selling, repairing, servicing, delivering, testing, road testing, parking or
storing motor vehicles, both of the following shall be conclusively presumed:
1. If, at the time of loss, the motor vehicle is being operated by any person
engaged in any of such businesses, or by his employee or agent, the insurance afforded by
the policy issued to the person engaged in such business shall be primary, and the
insurance afforded by any other policy shall be excess.
2. If, at the time of loss, the motor vehicle is being operated by any person other
than as described in paragraph 1, the insurance afforded by the policy issued to any
person engaged in any of such businesses shall be excess over all other insurance
available to such operator as a named insured or otherwise.
B. Except as provided in subsection A of this section, if two or more policies
affording valid and collectible liability insurance apply to the same motor vehicle in an
occurrence out of which a liability loss shall arise, it shall be conclusively presumed
that the insurance afforded by that policy in which such motor vehicle is described or
rated as an owned automobile shall be primary and the insurance afforded by any other
policy or policies shall be excess.
C. The presumptions stated in subsection A of this section may be modified or
amended only by written agreement signed by all insurers who have issued a policy or
policies applicable to a loss described in such subsection and all named insureds under
such policies.
20-1123 Annulment of liability policies
No insurance contract insuring against loss or damage through legal liability for
the bodily injury or death by accident of any individual, or for damage to the property
of any person, shall be retroactively annulled by any agreement between the insurer and
the insured after the occurrence of any injury, death or damage for which the insured may
be liable, and any attempted annulment shall be void.
20-1124 Discharge of insurer by payment under policy
When the proceeds of or payments under a life or disability insurance policy or
annuity contract become payable in accordance with the terms of the policy or contract,
or the exercise of any right or privilege thereunder, and the insurer makes payment
thereof in accordance with the terms of the policy or contract or in accordance with any
written assignment thereof, the person then designated in the policy or contract or by
the assignment as being entitled thereto shall be entitled to receive the proceeds or
payments and to give full acquittance therefor, and the payments shall fully discharge
the insurer from all claims under the policy or contract unless, before payment is made,
the insurer has received at its home office written notice by or on behalf of some other
person that such other person claims to be entitled to such payment or some interest in
the policy or contract.
20-1125 Discharge of payor by payment of benefits under employee benefit plan or life insurance policy
Notwithstanding the provisions of section 25-211, when payment or refund is made to
an employee, former employee or his beneficiary or estate pursuant to a written
retirement, death or other employee benefit plan or savings plan, or when the proceeds
of, or payments under, a policy or contract issued by a life insurance company becomes
payable, and the company makes payment in accordance with the terms thereof, or in
accordance with the terms of a written assignment thereof if the policy or contract has
been assigned, the payment or refund shall fully discharge the employer and any trustee
or insurance company making the payment or refund from all adverse claims thereto unless,
before payment or refund is made, the employer or former employer, where the payment is
made by the employer or former employer, has received at its principal place of business
within this state, written notice by or on behalf of some other person that such other
person claims to be entitled to the payment or refund or some part thereof, or where a
trustee or insurance company is making the payment, the notice has been received by the
trustee or insurance company at its home office. Nothing in this section shall affect a
claim or right to the payment or refund or part thereof as between all persons other than
the employer and the trustee or insurance company making such payment or refund.
20-1127 Simultaneous deaths
Where the individual insured or the annuitant and the beneficiary designated in a
life insurance policy or policy insuring against accidental death or in an annuity
contract have died and there is not sufficient evidence that they have died otherwise
than simultaneously, the proceeds of the policy or contract shall be distributed as if
the insured or annuitant had survived the beneficiary, unless otherwise specifically
provided in the policy or contract.
20-1128 Rights of spouse in life or disability policy
A. The benefits payable upon the death of the insured and provided in any life or
disability insurance policy made payable to or for the benefit of the spouse of the
insured shall, unless contrary to the terms of the policy, inure upon their becoming
payable, to the separate use and benefit of such spouse, but until the benefits become
payable the insurer shall be entitled to deal with the insured or person designated in
the policy as having control thereof with respect to the policy and all benefits thereof,
including loan and cash surrender values, without first securing the consent of such
spouse.
B. The beneficial interest of a spouse in a life or disability insurance policy as
to which a child of the spouse is the insured shall be deemed to be a community and not a
separate interest unless expressly otherwise provided in the policy, but if the premiums
paid to maintain the policy have been paid with separate funds or partly with separate
and partly with community funds, the proceeds and avails of the policy shall constitute
separate property in that proportion which the separate premiums paid bear to the total
premiums paid.
C. In any life or disability insurance policy issued upon the life of a spouse, the
designation made by such spouse of a beneficiary in accordance with the terms of the
policy shall create a presumption that the beneficiary was so designated with the consent
of the other spouse, but only as to any beneficiary who is the child, grandchild, parent,
brother or sister of either of the spouses. The insurer may in good faith rely upon the
representations made by the insured as to the relationship to him of any such
beneficiary.
20-1129 Furnishing of proof of loss forms by insurer
An insurer shall furnish, upon written request of any person claiming to have a loss
under an insurance contract issued by the insurer, forms of proof of loss for completion
by the person, but the insurer shall not, by reason of the requirement so to furnish
forms, have any responsibility for or with reference to the completion of such proof or
the manner of any such completion or attempted completion.
20-1130 Administration of claim against insurer not deemed waiver of defense
Without limitation of any right or defense of an insurer otherwise, none of the
following acts by or on behalf of an insurer shall be deemed to constitute a waiver of
any provision of a policy or of any defense of the insurer thereunder:
1. Acknowledgement of the receipt of notice of loss or claim under the policy.
2. Furnishing forms for reporting a loss or claim, for giving information relative
thereto, or for making proof of loss, or receiving or acknowledging receipt of any such
forms or proofs completed or uncompleted.
3. Investigating any loss or claim under any policy or engaging in negotiations
looking toward a possible settlement of any such loss or claim.
20-1131 Exemption of life insurance proceeds and cash values from creditors
A. If a policy of life insurance is effected by any person on the person's own life
or on another life in favor of another person having an insurable interest in the policy,
or made payable by assignment, change of beneficiary or other means to a third person,
the lawful beneficiary or such third person, other than the person effecting the
insurance or the person's legal representatives, is entitled to its proceeds against the
creditors and representatives of the person effecting the insurance.
B. Subject to the statute of limitations, the amount of any premiums for insurance
paid in fraud of creditors, with interest, shall inure to their benefit from the proceeds
of the policy, but the insurer issuing the policy shall be discharged of all liability on
the policy by payment of the proceeds in accordance with its terms, unless before payment
the insurer received written notice by or in behalf of some creditor, with specification
of the amount claimed, claiming to recover for certain premiums paid in fraud of
creditors.
C. For the purposes of subsection A, a policy shall also be deemed to be payable to
a person other than the insured if and to the extent that a facility-of-payment clause or
similar clause in the policy permits the insurer to discharge its obligation after the
death of the individual insured by paying the death benefits to a person as permitted by
the clause.
D. If, for a continuous, unexpired period of two years, a policy of life insurance
has named as beneficiary the insured's surviving spouse, child, parent, brother, sister
or any other dependent family member, then, in event of bankruptcy or in any proceeding
before any court in this state, the cash surrender value of the insurance, in the
proportion that the policy names any such beneficiary, shall be exempt from claims and
demands of all creditors, other than a creditor to whom the policy has been pledged or
assigned, and except that, subject to the statute of limitations, the amount of any
premiums which are recoverable or avoidable by a creditor pursuant to title 44, chapter
8, article 1, with interest, shall inure to their benefit from the cash surrender value.
For the purposes of this subsection, "dependent" means a family member who is dependent
on the insured for not less than half support. 20-1132 Exemption of group life insurance proceeds from creditors; exception
A. A policy of group life insurance or the proceeds thereof payable to the
individual insured or to the beneficiary thereunder shall not be liable, either before or
after payment, to be applied by any legal or equitable process to pay any liability of
any person having a right under the policy. The proceeds thereof, when not made payable
to a named beneficiary or to a third person pursuant to a facility-of-payment clause,
shall not constitute a part of the estate of the individual insured for the payment of
his debts.
B. This section shall not apply to group life insurance issued pursuant to article
2 of chapter 6 of this title to a creditor covering his debtors, to the extent that such
proceeds are applied to payment of the obligation for the purpose of which the insurance
was so issued.
20-1133 Medicare supplement insurance; applicability
A. The director shall adopt those rules as are necessary to comply with the
requirements of the social security disability amendments of 1980 (P.L. 96-265; 42 United
States Code section 1395ss) and any federal laws or regulations pertaining to that
section, so that this state may retain its full authority to regulate minimum standards
for medicare supplement insurance.
B. Subject to the other limitations provided in this subsection, no benefit
mandated in this title for health insurance policies shall apply to medicare supplement
insurance policies unless such mandated policy benefits are set forth in rules adopted
pursuant to this section or unless the statute mandating policy benefits expressly states
that it is made specifically applicable to medicare supplement insurance policies. No
medicare supplement insurance policy shall contain any exclusion for services provided by
any type of properly licensed health care provider if the provider's services are
eligible for medicare reimbursement and if the specific services in question would be
covered by medicare. In no event shall the scope of benefits of a medicare supplement
policy be less than the minimum level of benefits established by federal law.
C. Notwithstanding any other provision of this title, rules adopted pursuant to
this section apply to insurance furnished under disability insurance policies, under
subscription contracts of hospital, medical, dental or optometric service corporations,
under certificates of fraternal benefit societies, under evidences of coverage of health
care services organizations and under coverages issued by any other insurer, which
policies, contracts, certificates, membership coverages, evidences of coverage and
coverages are delivered or issued for delivery in this state on or after the effective
date of rules adopted pursuant to subsection A. In adopting the rules required by
subsection A, the director shall prescribe an effective date of the rules that will allow
insurers sufficient time to bring their forms and practices into compliance with the
requirements of the rule. 20-1134 Coordination of benefits
The director shall adopt rules relating to coordination of benefits provisions in
group disability insurance policies. This section shall apply to hospital and medical
service corporations and health care services organizations. 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.
20-1136 Accelerated payments of certain benefits in life insurance policies
A. Notwithstanding any other provision of this title, any policy of life insurance
may provide, in accordance with the provisions of subsection B, for the acceleration of
death benefits in advance of the time such benefits would otherwise be payable upon the
occurrence of a terminal illness, a catastrophic illness, or eligibility for long-term
care.
B. The director may adopt rules regarding advertising, disclosure, benefit levels,
benefit eligibility, nonforfeiture, and reserves for the accelerated payment of death
benefits set forth under subsection A.
20-1137 Limited benefit coverage; prohibited practice; definition
A. Bundling or combining various limited benefit insurance policies and advertising
or indicating in any manner that these policies are major medical expense coverage
policies or could be substituted for major medical expense coverage is a prohibited
practice pursuant to chapter 2, article 6 of this title.
B. For the purposes of this title, "limited benefit coverage" means an insurance
policy that is designed, advertised and marketed to supplement major medical insurance
and that includes accident only, dental only, vision only, disability income only, fixed
or hospital indemnity, specified disease insurance, credit insurance or Taft-Hartley
trusts.
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