23 CAR Part 132 — Prohibition on the Use of Discretionary Clauses in Disability Income Policies

Chapter I

Subchapter B

Subpart 1

23 CAR § 132-101 Purpose {#sec-23-car-132-101 omnilex-key=us-ar-regs-official--title-23-part-132--23 CAR § 132-101}

23 CAR § 132-101. Purpose.

(a) The purpose of this part is to prohibit conflicts of interest that may arise when an insurer responsible for providing disability income benefits has discretionary authority to decide what benefits are due.

(b) Nothing in this part shall be construed as imposing any requirement or duty on any person other than an insurer that offers disability income protection coverage.

23 CAR § 132-102 Definitions {#sec-23-car-132-102 omnilex-key=us-ar-regs-official--title-23-part-132--23 CAR § 132-102}

23 CAR § 132-102. Definitions.

As used in this part:

(1) "Commissioner" means the Insurance Commissioner;

(2) "Disability income protection coverage" is a policy, contract, certificate, or agreement issued by an insurer subject to the insurance laws and rules of this state, or subject to the jurisdiction of the Insurance Commissioner, that provides for periodic payments, weekly or monthly, for a specified period during the continuance of disability resulting from either sickness or injury or a combination of them; and

(3) "Person" means:

(A) An individual;

(B) A corporation;

(C) A partnership;

(D) An association;

(E) A joint venture;

(F) A joint stock company;

(G) A trust;

(H) An unincorporated organization; or

(I) Any similar entity or combination of the foregoing.

23 CAR § 132-103 Discretionary clauses prohibited {#sec-23-car-132-103 omnilex-key=us-ar-regs-official--title-23-part-132--23 CAR § 132-103}

23 CAR § 132-103. Discretionary clauses prohibited.

No policy, contract, certificate, or agreement offered or issued in this state providing for disability income protection coverage may contain a provision purporting to reserve discretion to the insurer to interpret the terms of the contract, or to provide standards of interpretation or review that are inconsistent with the laws of this state.

23 CAR § 132-104 Penalties {#sec-23-car-132-104 omnilex-key=us-ar-regs-official--title-23-part-132--23 CAR § 132-104}

23 CAR § 132-104. Penalties.

A violation of this part shall be subject to the same penalties and remedies authorized to be imposed against an insurer by the Insurance Commissioner under Arkansas Code § 23-66-210.