Section R20-6-604.10. Prohibited Transactions

A.      The practices listed in this Section are deemed unfair trade practices under A.R.S. § 20-442. An insurer that commits any of the following practices is subject to penalties as prescribed in A.R.S. § 20-456:

1.        Offering or providing a creditor with any special advan- tage or any service not set out in either the group insur- ance contract or in the agency contract, other than payment of commissions;

2.        Agreeing to deposit with a bank or financial institution, the insurer’s money or securities as a substitute for a deposit of money or securities that the financial institu- tion would otherwise require from the creditor as a com- pensating balance or deposit offset for a loan or other advancement; or

3.        Depositing money or securities without interest or at a lesser rate of interest than the creditor, bank, or financial institution is currently paying on other similar deposits.

B.       This Section does not prohibit an insurer from maintaining demand deposits or premium deposit accounts that are reason- ably necessary for use in the ordinary course of the insurer’s business.

Historical Note

New Section made by final rulemaking at 8 A.A.R. 2725, effective June 7, 2002 (Supp. 02-2).