Arizona Revised Statutes Title 20. Insurance § 20-481.19. Extraordinary dividend or distribution; time; notice; approval by director; definition

A. No insurer subject to registration under § 20-481.09 shall pay an extraordinary dividend or make any other extraordinary distribution to its shareholders until thirty days after the director has received notice of the declaration thereof and has not within such period disapproved such payment, or the director shall have approved such payment. Notice of the declaration shall be provided to the director no more than five business days after the declaration.

B. Notwithstanding any other law, an insurer may declare an extraordinary dividend or distribution that is conditional on the approval of the director, and such a declaration shall confer no rights on shareholders until the director has either approved the payment of such dividend or distribution or has not disapproved such payment within thirty days after the notice of such declaration has been received.

C. For the purposes of this section, “extraordinary dividend or distribution” includes any dividend or distribution of cash or other property whose fair market value together with that of other dividends or distributions made within the preceding twelve months exceeds the lesser of either ten per cent of such insurer's surplus as regards policyholders as of December 31 next preceding, or the net gain from operations of such insurer, if such insurer is a life insurer, or the net income, if such insurer is not a life insurer, for the twelve month period ending December 31 next preceding, but shall not include pro rata distributions of any class of the insurer's own securities.