23 CAR Part 202 — Personal Lines Property and Casualty Language Simplification

Chapter I

Subchapter C

Subpart 1

23 CAR § 202-101 Purpose {#sec-23-car-202-101 omnilex-key=us-ar-regs-official--title-23-part-202--23 CAR § 202-101}

23 CAR § 202-101. Purpose.

(a) The purpose of this part is to establish minimum language and format standards to make property and casualty insurance policies for personal lines easier to read.

(b) This part is not intended to increase the risk assumed under policies subject to it, nor is it intended to impede flexibility and innovation in the development of policy forms or content.

23 CAR § 202-102 Applicability and scope {#sec-23-car-202-102 omnilex-key=us-ar-regs-official--title-23-part-202--23 CAR § 202-102}

23 CAR § 202-102. Applicability and scope.

(a) This part shall apply to all personal lines property and casualty insurance policies delivered or issued for delivery in this state by or on behalf of any insurer licensed in this state.

(b) For the purpose of this part, "personal lines policies" are:

(1) Solely used to provide homeowners insurance, dwelling fire insurance on one (1) to four (4) family units, or individual fire insurance on dwelling contents; or

(2) Principally used to provide primary insurance on private passenger nonfleet automobiles individually owned and used for personal and family needs.

23 CAR § 202-103 Standards {#sec-23-car-202-103 omnilex-key=us-ar-regs-official--title-23-part-202--23 CAR § 202-103}

23 CAR § 202-103. Standards.

To comply with Arkansas Code § 23-80-306, policies covered by 23 CAR §§ 202-101 and 202-102 shall meet the following standards:

(1) The policy shall include a table of contents of important provisions;

(2)(A) Each section shall be self-contained and independent.

(B) However, general provisions applicable to more than one (1) section may be included in a common section;

(3) The policy, except for declarations pages, schedules, and tables, shall be printed in not less than eight-point type, one-point leaded;

(4)(A) The policy shall be printed in a legible type style with adequate contrast between ink and paper.

(B) Captions, headings, and spacing shall be used to increase overall legibility;

(5)(A) The policy shall be written in everyday, conversational language, consistent with its standing as a contract.

(B) Short sentences and a personal style shall be used wherever possible;

(6) Technical terms and words with special meaning shall be avoided wherever possible; and

(7)(A) The policy text shall achieve a minimum score of 40 on the Flesch Reading Ease Test, an equivalent score on any other comparable test, or a lower score on either if the Insurance Commissioner finds the policy reasonably easy to read.

(B) For purposes of this section, a Flesch Reading Ease Test shall be scored by the following method:

(i)(a) For a policy containing ten thousand (10,000) words or less of text, the entire policy shall be analyzed.

(b) For a policy containing more than ten thousand (10,000) words, the readability of two (2) one hundred-word samples per page may be analyzed instead.

(c) The samples shall be separated by at least twenty (20) printed lines;

(ii)(a) The total number of words in the text or sample shall be divided by the total number of sentences.

(b) The figure obtained shall be multiplied by 1.015;

(iii)(a) The total number of syllables in the text or sample shall be divided by the total number of words.

(b) The figure obtained shall be multiplied by 84.6; and

(iv) The sum of the figures computed under subdivisions (7)(B)(ii) and (iii) of this section subtracted from 206.835 equals the Flesch Reading Ease Test score.

(C) For purposes of this section, the following procedures shall be used:

(i) A contraction, hyphenated word, numbers, and letters, when separated by spaces, shall be counted as one (1) word;

(ii) A unit of text ending with a period, semicolon, or colon shall be counted as a sentence;

(iii)(a) A syllable means a unit of spoken language consisting of one (1) or more letters of a word as divided by an accepted dictionary.

(b) Where the dictionary shows two (2) or more equally acceptable pronunciations of a word, the pronunciation containing fewer syllables may be used; and

(iv) At the option of the insurer, any form made a part of the policy may be scored separately or as part of the policy.

(D) The term "text" as used in this section includes all printed matter except:

(i) The name and address of the insurer;

(ii) The name, number, or title of the policy or form;

(iii) The table of contents or index;

(iv) Headings and captions; and

(v) Declarations pages, schedules, or tables.