This bill proposes several updates to the current statutes regarding captive insurers in Arizona. It introduces a new definition for "dormant captive insurer," which refers to a captive insurer that has ceased all insurance transactions and has no outstanding liabilities or has not issued any policies prior to applying for a dormancy certificate. The bill allows these dormant insurers to apply for a certificate of dormancy, which must be renewed every five years, and establishes requirements for maintaining unimpaired capital and surplus of at least $125,000, submitting annual financial reports, and paying renewal fees. Additionally, it prohibits dormant insurers from conducting insurance business until they have surrendered their dormancy certificate, which requires approval from the Director of the Department of Insurance and Financial Institutions (DIFI).

Furthermore, the bill modifies existing requirements for captive insurers, including reducing the minimum capital and surplus for protected cell captive insurers from $500,000 to $250,000, and mandates that captive insurers formed as limited liability companies must have at least one Arizona resident on their board of managers. It also changes the timing for license renewal fees, requiring them to be paid between July 1 and September 1 each year, rather than upon filing the annual report. The bill includes technical and conforming changes to ensure consistency with these new provisions.

Statutes affected:
Introduced Version: 20-1098, 20-1098.01, 20-1098.03, 20-1098.04, 20-1098.24, 20-481, 20-1098.06, 20-822, 20-1051, 20-1001, 20-1097, 20-1562, 20-1541, 23-961, 20-1098.07, 20-1098.11, 20-167, 20-3601
House Engrossed Version: 20-1098, 20-1098.01, 20-1098.03, 20-1098.04, 20-1098.24, 20-481, 20-1098.06, 20-822, 20-1051, 20-1001, 20-1097, 20-1562, 20-1541, 23-961, 20-1098.07, 20-1098.11, 20-167, 20-3601
Chaptered Version: 20-1098, 20-1098.01, 20-1098.03, 20-1098.04, 20-1098.24, 20-481, 20-1098.06, 20-822, 20-1051, 20-1001, 20-1097, 20-1562, 20-1541, 23-961, 20-1098.07, 20-1098.11, 20-167, 20-3601