14.6.1 Licensing and Regulatory Obligations.

• Jurisdiction: Arizona

14.6.1 Licensing and Regulatory Obligations. As professionals, insurance producers are regulated by the State to protect the public.¹⁰² For example, before insurance producers can legally transact insurance business in Arizona, they must obtain a license.¹⁰³ According to Darner, “[p]ublic policy supports the adoption of rules which tend to discourage negligence or misconduct in the insurance industry.”¹⁰⁴ Arizona’s licensing requirement is such a rule.¹⁰⁵ Agents have other statutory responsibilities which also may give rise to regulatory discipline, rather than tort liability, such as the protection, use and maintenance of insureds’ personal information,¹⁰⁶ record retention,¹⁰⁷ or placing excess and surplus lines coverage.¹⁰⁸

Producers may also have specific statutory or regulatory duties which only apply to the solicitation or sale of particular kinds of insurance policies. For example, life insurance producers must investigate whether the offered policy replaces an existing policy, and if so, provide specific, Arizona Department of...