What Is an Advisory Organization

For Property and Casualty lines of insurance other than Workers’ Compensation and Title insurance an "Advisory organization" means any person other than a single insurer who assists insurers or rate service organizations in the making of rates by compiling and furnishing loss or expense statistics or other statistical information and data, or by the submission of recommendations as to rates, forms or supplementary rate information. Advisory organization does not include a joint underwriting association, any actuarial or legal consultant, any employee of an insurer or insurers under common control or management or their employees or manager. ARS 20-381.

For Workers’ Compensation and Title insurance an Advisory Organization is any group, association or other organization of insurers, whether located within or outside this state, which assists insurers which make their own filings or rating organizations in rate making, by the collection and furnishing of loss or expense statistics, or by the submission of recommendations, but which does not make filings under this article, shall be known as an advisory organization. ARS 20-368.

 

Who Must Be Registered?

Every group, association or other organization of insurers, whether located within or outside this state, assists insurers, which make their own filings, or rating organizations in rate making, by the collection and furnishing of loss or expense statistics, or by the submission of recommendations, but which does not make filings.

APPLICATION FOR REGISTRATION OF ADVISORY ORGANIZATION

What Is a Rate Service Organization

"Rate service organization" means any person other than a single insurer who assists insurers by compiling and furnishing loss or expense statistics and recommending, making or filing rates, forms or supplementary rate information. Rate service organization does not include a joint underwriting association, any actuarial or legal consultant, any employee of an insurer or insurers under common control or management, or their employees or manager. ARS 20-381.

Who Must Be Licensed?

A corporation, an unincorporated association, a partnership or an individual, whether located within or outside this state, may apply to the director for a license as a rating organization for insurance.

LICENSE APPLICATION FOR A RATE SERVICE ORGANIZATION

What Is a Rating Organization

For Workers’ Compensation a Rating Organization receives and analyzes and interprets data (statistical
data, past and present loss experience, catastrophe hazards, insurer expenses and other outlays) and

determines a rating system (manual of risk classifications, rules and rates, and rating plan) applicable to a
type of insurance. Insurers that are members of a rating organization must use the rating organization's
rating system as their own except that an insurer may file a "deviation," which is either a uniform percentage increase or decrease to the rating system, or changes from the rate rule established for a classification of risk to reflect the risk profile for a more specific subcategory of risk. ARS 20-361

Who Must Be Licensed

A corporation, an unincorporated association, a partnership or an individual, whether located within
or outside this state, may apply to the director for a license as a rating organization for insurance.

LICENSE APPLICATION FOR A RATING ORGANIZATION

Advisory, Rate Service and Rating Organizations