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23-66-312. Favored agent or insurer — Coercion of debtors.
Arkansas Code — all titles (historical 2020) · legal_authorities
23-66-312. Favored agent or insurer — Coercion of debtors.
(a) No person, including, but not limited to, depository institutions and affiliates of depository institutions, primary and secondary mortgagees, vendors, or lenders may:
(1) Unreasonably disapprove the insurance policy or binder provided by a borrower for the protection of the property securing the credit or lien;
(2)(A) Require, directly or indirectly, that any borrower, mortgagor, purchaser, insurer, broker, or agent pay a separate charge in connection with the handling of any insurance policy or binder required as security for a loan on real estate or pay a separate charge to substitute the insurance policy or binder of one (1) insurer for that of another.
(B) Subdivision (a)(2)(A) of this section does not apply to charges that would be required if the person or depository institution or affiliate of a depository institution is the licensed producer providing the insurance; or
(3) Use or disclose information resulting from a requirement that a borrower, mortgagor, or purchaser furnish insurance of any kind when that information is to the advantage of the mortgagee, vendor, or lender or is to the detriment of the borrower, mortgagor, purchaser, insurer, or the agent or broker complying with this requirement.
(b)(1) Subdivision (a)(2) of this section does not include the interest that may be charged on premium loans or premium advancements in accordance with the security instrument.
(2)(A) For purposes of subdivision (a)(1) of this section, a rejection shall not be deemed unreasonable if it is based on uniformly applied reasonable standards relating to the extent of coverage required and the financial soundness and the services of an insurer.
(B) The standards shall not discriminate against an
Source: Arkansas Code — historical release 78 (November 6, 2020) · 23-66-312
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. A text match is a research starting point; applicability is not established.
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Stable record: arkansas_code:legal_authorities:23-66-312
Source file: gov.ar.code.title.23.odt
Pages: Not recorded – Not recorded
Passage SHA-256: 515092bd7ad75503058ee1239f1a50bdcd4c91b61c605dbc4aaeec384f264d61
Source location: content.xml paragraph 38024
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23-66-312. Favored agent or insurer — Coercion of debtors.
(a) No person, including, but not limited to, depository institutions and affiliates of depository institutions, primary and secondary mortgagees, vendors, or lenders may:
(1) Unreasonably disapprove the insurance policy or binder provided by a borrower for the protection of the property securing the credit or lien;
(2)(A) Require, directly or indirectly, that any borrower, mortgagor, purchaser, insurer, broker, or agent pay a separate charge in connection with the handling of any insurance policy or binder required as security for a loan on real estate or pay a separate charge to substitute the insurance policy or binder of one (1) insurer for that of another.
(B) Subdivision (a)(2)(A) of this section does not apply to charges that would be required if the person or depository institution or affiliate of a depository institution is the licensed producer providing the insurance; or
(3) Use or disclose information resulting from a requirement that a borrower, mortgagor, or purchaser furnish insurance of any kind when that information is to the advantage of the mortgagee, vendor, or lender or is to the detriment of the borrower, mortgagor, purchaser, insurer, or the agent or broker complying with this requirement.
(b)(1) Subdivision (a)(2) of this section does not include the interest that may be charged on premium loans or premium advancements in accordance with the security instrument.
(2)(A) For purposes of subdivision (a)(1) of this section, a rejection shall not be deemed unreasonable if it is based on uniformly applied reasonable standards relating to the extent of coverage required and the financial soundness and the services of an insurer.
(B) The standards shall not discriminate against any particular type of insurer, nor shall the standards call for rejection of a policy because it contains coverage in addition to that required in the credit transaction.
(3) Subdivision (a)(3) of this section does not restrict or limit the release of insurance information of a customer by a depository institution to any officer, director, employee, agent, or affiliate of the depository institution for the purpose of soliciting or selling insurance.
(4)(A) The Insurance Commissioner may investigate the affairs of any person to whom this subsection applies to determine whether the person has violated this subsection.
(B) If a violation of this subsection is found, the person in violation shall be subject to the same procedures and penalties as are applicable to §§ 23-66-203, 23-66-206, 23-66-207, and 23-66-209 — 23-66-213 and shall be liable for actual or compensatory damages resulting from an unreasonable disapproval of an insurance policy or binder.
(5) Once a binder has been issued, the insurer must issue a policy within ninety (90) days.
(6) All information given on the binder must be without material change when the policy is issued.
(c) The provisions of this section do not apply to credit-related insurance, such as credit life or credit accident and health insurance.
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Arkansas Code — all titles (historical 2020) · legal_authorities
23-66-203. Definitions.
As used in this subchapter:
(1) “Commissioner” means the Insurance Commissioner of this state;
(2)(A) “Depository institution” means a bank or savings association.
(B) The terms “depository institution” or “depository corporation” do not include an insurance company;
(3) “Insurance policy” or “insurance contract” means any contract of insurance, indemnity, medical or hospital service, suretyship, or annuity which is issued, proposed for issuance, or intended for issuance by any person; and
(4)(A) “Person” means any individual, corporation, association, partnership, reciprocal exchange, interinsurer, Lloyd's insurer, fraternal benefit society, and any other legal entity engaged in the business of insurance, including agents, brokers, and adjusters.
(B)(i) “Person” also means medical service plans and hospital service plans as defined in § 23-75-101.
(ii) For purposes of this subchapter, medical and hospital service plans shall be deemed to be engaged in the business of insurance.
Source: Arkansas Code — historical release 78 (November 6, 2020) · 23-66-203
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. The source passage cites 23-66-203. This identifies an authority to review, not proof of applicability.
Arkansas Code — all titles (historical 2020) · legal_authorities
23-66-206. Unfair methods of competition and unfair or deceptive acts or practices defined.
The following are defined as unfair methods of competition and unfair or deceptive acts or practices in the business of insurance:
(1) “Boycott, coercion, and intimidation” means entering into any agreement to commit or, by any concerted action, committing any act of boycott, coercion, or intimidation resulting in or tending to result in unreasonable restraint of, or monopoly in, the business of insurance;
(2) “Churning of business” means a situation in which the licensee replaces an existing policy of life insurance or accident and health insurance, or both, and that replacement is:
(A) Not in accordance with § 23-66-307; or
(B) Without objective demonstration by the licensee of the purpose of replacing the policy for the benefit and betterment of the insured;
(3) “Defamation” means making, publishing, disseminating, or circulating, directly or indirectly, or aiding, abetting, or encouraging the making, publishing, disseminating, or circulating of any oral or written statement or of any pamphlet, circular, article, or literature that is false or maliciously critical of or derogatory to the financial condition of any person and that is calculated to injure that person;
(4)(A) “Failure to maintain complaint handling procedures” means failing to adopt and implement reasonable standards for the prompt handling of complaints received by the person from insureds or claimants, or from the Insurance Commissioner on behalf of insureds or claimants, and failing to keep a record of the complaints received.
(B) A complete complaints register of all complaints that the person has received shall be maintained for the current year plus five (5) calendar years. This complaints re
Source: Arkansas Code — historical release 78 (November 6, 2020) · 23-66-206
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. The source passage cites 23-66-206. This identifies an authority to review, not proof of applicability.
Arkansas Code — all titles (historical 2020) · legal_authorities
23-66-207. Rules to identify prohibited methods of competition, acts, or practices.
(a) The Insurance Commissioner may, after notice and hearing, promulgate reasonable rules, as are necessary or proper to identify specific methods of competition or acts or practices which are prohibited by § 23-66-206 or § 23-66-312, but the rules shall not enlarge upon or extend the provisions of those sections.
(b) The rules shall be subject to review in accordance with § 23-61-307.
Source: Arkansas Code — historical release 78 (November 6, 2020) · 23-66-207
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. The source passage cites 23-66-207. This identifies an authority to review, not proof of applicability.
Arkansas Code — all titles (historical 2020) · legal_authorities
23-66-209. Hearings — Procedures.
(a)(1) Whenever the Insurance Commissioner has reason to believe that any person has been engaged or is engaging in this state in any unfair method of competition or any unfair or deceptive act or practice, whether or not defined in § 23-66-206 or § 23-66-312 and that a proceeding by the commissioner in respect thereto would be to the interest of the public, the commissioner shall issue and serve upon the person a statement of the charges in that respect and a notice of a hearing thereon to be held at a time and place fixed in the notice, which shall not be fewer than ten (10) days after the date of the service thereof.
(2) If the person in subdivision (a)(1) of this section is a depository institution, the commissioner shall have the power to require the depository institution to produce books, papers, records, correspondence, or other documents that the commissioner deems relevant only to an inquiry of the insurance activities of the depository institution.
(b) At the time and place fixed for the hearing, the person shall have an opportunity to be heard and to show cause why an order should not be made by the commissioner requiring such a person to cease and desist from the acts, methods, or practices so complained of. Upon good cause shown, the commissioner shall permit any person to intervene, appear, and be heard at the hearing by counsel or in person.
(c) Nothing contained in this subchapter shall require the observance at the hearing of formal rules of pleading or evidence.
(d)(1) Upon the hearing, the commissioner:
(A) May administer oaths, examine and cross-examine witnesses, and receive oral and documentary evidence; and
(B) Shall have the power to subpoena witnesses, compel their attendance, and require the prod
Source: Arkansas Code — historical release 78 (November 6, 2020) · 23-66-209
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. The source passage cites 23-66-209. This identifies an authority to review, not proof of applicability.