House of Representatives

HB 2580

title agents; limited liability companies

Sponsors: Representatives Voss: Avelar, Maiorana, May, McClure, Poelstra, Senators Burns, Martin

X	Committee on Financial Institutions and Insurance
	Caucus and COW
	As Passed the House

HB 2580 amends A.R.S. 29-609 to permit title insurance agents to form and conduct business as limited liability corporations (LLC). The members, or investors, of a title insurance agency business formed as an LLC would be held individually liable.

History

In 1992 the Arizona Legislature passed the Limited Liability Act which allows a business to organize as an LLC as long as it does not conduct or promote banking or insurance activities (A.R.S. 29-609). An LLC is a hybrid between a corporation and a partnership in that its investors have limited liability much like a corporation, while it is taxed like a partnership at both the state and federal levels.

Provisions

· Permits an LLC to conduct business as a title insurance agent.

· Adds limited liability companies to the definition of a “title insurance agent.”

· Allows the Director of the Department of Insurance to grant a temporary license to a qualified LLC.

· Deems members of an LLC to be individually liable for all engagements of the company up to the amount of each person’s initial investment in the LLC.

· Makes technical corrections.

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· 45th Legislature

· First Regular Session 2 February 13, 2001

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