§ 23-83-106 - Association groups. - Arkansas Statutes

23-83-106. Association groups.

(a) A policy can be issued to an association or to a trust or to the trustee or trustees of a fund established, created, or maintained for the benefit of members of one (1) or more associations.

(b) The association shall have:

(1) At the outset a minimum of one hundred (100) persons;

(2) Been organized and maintained in good faith for purposes other than that of obtaining insurance;

(3) Been in active existence for at least two (2) years; and

(4) A constitution and bylaws which provide that:

(A) The association hold regular meetings not less than annually to further purposes of members;

(B) Except for credit unions, the association collect dues or solicit contributions from members; and

(C) The members have voting privileges and representation on the governing board and committees.

(c) The policy shall be subject to the following requirements:

(1) The policy may insure members of the association, employees thereof, or employees of members, or one (1) or more of the preceding or all of any classes thereof for the benefit of persons other than the employee's employer;

(2) The premium for the policy shall be paid from funds contributed by the association or by employer members, or by both, or from funds contributed by the covered persons or from both the covered persons and the association or employer members;

(3) Except as provided in subdivision (c)(5) of this section, a policy on which no part of the premium is to be derived from funds contributed by the covered persons specifically for their insurance must insure all eligible persons, except those who reject the coverage in writing;

(4) The Insurance Commissioner may issue regulations setting forth the disclosure requirements if a part or all of the premium for a policy issued under this section is derived from funds contributed by the covered persons for their insurance and if any compensation, including, but not limited to, dividends, premiums refunds, or retroactive rate adjustments, is received, directly or indirectly, by the policyholder, including participating associations of a trust; and

(5) An insurer may exclude or limit the coverage on any person as to whom evidence of individual insurability is not satisfactory to the insurer.