§ 23-79-306 — Requirements

Arkansas § 23-79-306

• Jurisdiction: Arkansas
• Title: 23

Text

The following requirements are applicable only as to claims-made policies as defined in § 23-79-302 : (1) The policy application and the initial page of each claims-made policy must include a conspicuous notice at the top indicating that the contract is a claims-made policy; (2) The insurer must provide at no additional charge an automatic sixty-day extended reporting period upon cancellation or termination of the claims-made policy by either the insured or insurer; (3) (A) At the expiration of the automatic sixty-day extended reporting period as required by subdivision (2) of this section, the insurer must offer an extended reporting period endorsement. (B) Any notice of termination of a claims-made policy must include a disclosure advising the insured and his or her agent of the availability of and premium for an extended reporting period endorsement and the importance of purchasing the coverage; (4) The premium for any extended reporting period endorsement shall be based upon the rates and rating rules in effect at the inception date of the last policy period of the claims-made policy; (5) Form or rate/rule filings restricting the risks to be covered by an extended reporting period endorsement shall not be approved or accepted for use by the Insurance Commissioner; (6) The limit of liability in the policy aggregate for the optional extended reporting period endorsement offered by the insurer shall be no less than the greater of the amount of coverage remaining in the expiring policy aggregate or fifty percent (50%) of the aggregate at policy inception. The insurer may offer to increase the original amount of the aggregate limit of liability applicable during the period of the extended reporting period endorsement; (7) (A) A retroactive date may only be advanced with the written consent of the first-named insured and upon one (1) or more of the following conditions: (i) If there is a change in insurer other than another insurer within the same insurance holding company or group; (ii) If there is a substantial change in the insured's operations which would have been a material factor in the insurer's acceptance or declination of the risk; or (iii) At the request of the first-named insured. (B) Prior to advancement of the retroactive date under subdivisions (7)(A)(i)-(iii) of this section, the insured must receive a disclosure form for his or her signature which acknowledges that he or she has been advised of his or her right to purchase an extended reporting period endorsement; and (8) The insurer must provide the following loss information to the named insured within thirty (30) days of the insured's request and within fifteen (15) days after notice of cancellation or nonrenewal is issued: (A) Description of closed claims including the date and description of occurrence, amount of payments, if any; (B) Description of open claims including the date and description of occurrence, amount of payment, if any, and an estimate of reserves, if any; and (C) Information on notices of occurrence including the date and an estimate of reserves, if any.

Legislative History

Acts 1987, No. 204, § 4; 1991, No. 1123, § 13.