ARIZONA HOUSE OF REPRESENTATIVES

Fifty-sixth Legislature

Second Regular Session

House: COM DPA 9-0-0-1

HB 2204: workers' compensation rates; deviation

Sponsor: Representative Livingston, LD 28

House Engrossed

Overview

Allows certain insurers to file for a premium credit from the rating organization's uniform rate filing.

History

The Department of Insurance and Financial Institutions (DIFI) oversees insurance rate regulation to promote the public welfare and prevent excessive, inadequate or discriminatory rates. DIFI designates a rating organization for the purpose of annually making and filing statewide workers' compensation insurance rates (A.R.S. §§ 20-341 and 20-371).

A workers' compensation or employers' liability insurer (insurer) must adhere to the statewide workers' compensation insurance rates filed with DIFI, except an insurer may file: 1) up to six uniform percentage deviations to adjust the statewide rate portion of the rating organization's rate filing; and 2) a subclassification rate related rule that deviates from the rating organization rules or schedule rating plan. An insurer may not simultaneously apply a deviation and a schedule rating to the same insured risk. If an insurer files more than one deviation, each must be consistent with underwriting rules based on criteria that would lead to a logical distinction of potential risk (A.R.S. § 20-359).

Provisions

1.   Permits a rating organization's member insurer to file a premium credit of up to 5% from the rating organization's uniform rate filing based on a policyholder's membership in an association. (Sec. 2)

2.   ☐ Prop 105 (45 votes) ☐ Prop 108 (40 votes) ☐ Emergency (40 votes) ☒ Fiscal NoteDefines association as a membership organization whose membership is comprised of persons that are in a similar or related line of commerce, that is organized to promote and improve business conditions in that line of commerce, that is not engaged in a regular business of a kind that is ordinarily carried on for profit and whose net earnings do not inure to the benefit of any member. (Sec. 1)

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6.                     HB 2204

7.   Initials PB           Page 0 House Engrossed

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