Key Takeaways
- The Arizona Department of Insurance and Financial Institutions (DIFI) regulates all P&C insurance activities in the state
- The Director of Insurance is appointed by the Governor and serves at the Governor's pleasure
- Arizona uses a file and use rate system for most P&C lines, with prior approval required for some lines
- DIFI has authority over licensing, rate review, market conduct, and consumer protection
- Arizona requires fingerprinting for all insurance license applicants as part of the background check
Last updated: January 2026
Arizona Department of Insurance and Financial Institutions (DIFI)
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The Arizona Department of Insurance and Financial Institutions (DIFI) is the state agency responsible for regulating the Property & Casualty insurance industry in Arizona.
The Director of Insurance
The Director of Insurance is:
- Appointed by the Governor
- Serves at the Governor's pleasure (no fixed term)
- Responsible for enforcing the Arizona Insurance Code (Title 20)
- Authorized to adopt regulations, review rates, investigate violations, and discipline licensees
Director Powers for P&C Insurance
| Power | Description |
|---|---|
| Licensing | Issue, suspend, and revoke producer licenses |
| Rate Review | File and use or prior approval depending on line |
| Market Conduct | Examine insurer business practices |
| Enforcement | Investigate and prosecute violations |
| Consumer Protection | Handle complaints and protect policyholders |
| Rulemaking | Adopt rules interpreting the Insurance Code |
Arizona Rate Regulation
Arizona uses different rate systems for different lines:
Rate Systems by Line
| Line of Insurance | Rate System |
|---|---|
| Personal Auto | Competitive rating (file and use) |
| Homeowners | File and use |
| Commercial Lines | File and use |
| Workers' Compensation | File and use |
| Title Insurance | Prior approval |
File and Use
Under Arizona file and use:
- Rates can be used immediately upon filing
- DIFI reviews rates after implementation
- Rates must not be excessive, inadequate, or unfairly discriminatory
- DIFI can disapprove rates after review
Exam Tip: Arizona uses file and use for most P&C lines. Know that the Director is appointed by the Governor with no fixed term.
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Test Your Knowledge
How is the Arizona Director of Insurance selected?
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Test Your Knowledge
What rate system does Arizona use for personal auto insurance?
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Test Your Knowledge
Which Arizona agency regulates Property & Casualty insurance?
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