Title 27 — Title 27

In any determination of the financial condition of an insurer, there shall be allowed as assets only such assets as are owned by the insurer and which consist of: (1) Cash in the possession of the insurer or in transit under its control, and including the true balance of any depo…

In addition to assets impliedly excluded by the provisions of Section 27-37-1, the following expressly shall not be allowed as assets in any determination of the financial condition of an insurer: (1) Good will, trade names, and other like intangible assets; (2) Advances to offic…

Assets may be allowed as deductions from corresponding liabilities, and liabilities may be charged as deductions from assets and deductions from assets may be charged as liabilities in accordance with the form of an annual statement applicable to the insurer as prescribed by the …

(a) The commissioner shall disallow as an asset or as a credit against liabilities any reinsurance found by him after a hearing thereon to have been arranged for on a temporary basis for the purpose principally of deception as to the ceding insurer’s financial condition as at the…

(a) All bonds or other evidences of debt having a fixed term and rate of interest held by an insurer shall, if amply secured and not in default as to principal or interest, be valued as follows: (1) If purchased at par, at the par value; (2) If purchased above or below par, on th…

(a) Securities, other than those referred to in Section 27-37-5, held by an insurer shall be valued, in the discretion of the commissioner, at their market value, or at their appraised value or at prices determined by him as representing their fair market value. (b) Preferred or …

Chattel Mortgages. (a) Real property acquired pursuant to a mortgage loan or contract for sale, in the absence of a recent appraisal deemed by the commissioner to be reliable, shall not be valued at an amount greater than the unpaid principal of the defaulted loan or contract at …

Funeral supply inventories owned by the insurer shall be valued at an amount not exceeding cost to the insurer or market value, whichever is lower. Funeral equipment owned by the insurer shall be valued at an amount not in excess of cost to the insurer reduced by depreciation at …

Purchase money mortgages on real property shall be valued in an amount not exceeding the acquisition cost of the real property covered thereby or the unpaid balance of the debt secured by such mortgage, whichever is less. History: (Acts 1971, No. 407, p. 707, §753.)

Insurance or Annuities and Benefits Incidental Thereto. A life insurer organized under the laws of this state may, by or pursuant to a resolution of its board of directors, establish one or more separate accounts and may allocate thereto amounts, including without limitation proc…

Death Benefit Provision. (a) Any variable contract providing benefits payable in variable amounts delivered, or issued for delivery, in this state shall contain a statement of the essential features of the procedures to be followed by the insurer in determining the dollar amount …

(a) No insurer shall deliver, or issue for delivery, within this state variable contracts unless it is licensed to do a life insurance or annuity business in this state and the commissioner is satisfied that its condition or method of operation in connection with the issuance of …

Notwithstanding any other provision of law, the commissioner shall have sole authority to regulate the issuance and sale of variable contracts and the licensing of persons selling such contracts and to issue reasonable rules and regulations as may be appropriate to carry out the …

The reserve liability for variable contracts shall be established in accordance with actuarial procedures that recognize the variable nature of the benefits provided and any mortality guarantees. History: (Acts 1971, No. 407, p. 707, §758; Acts 1985, 2nd Ex. Sess., No. 85-993, p.…

Except for Sections 27-15-16, 27-15-17, 27-15-22, 27-15-23, and 27-15-28.1 of this title, in the case of a variable annuity contract, and Sections 27-15-2, 27-15-3, 27- 15-8.1, 27-15-9, 27-15-10, 27-15-11, and 27-15-28 of this title, in the case of a variable life insurance polic…

For the purposes of this chapter, the following terms shall have the meanings respectively ascribed to them by this section: (1) AUTOMOBILE CLUB OR ASSOCIATION. A legal entity which, in consideration of dues, assessments, or periodic payments of money, promises its members or sub…

This chapter shall be deemed and held exclusive authority for the organization and operation of automobile clubs and associations within this state, and such clubs and associations shall not be subject to any other laws respecting insurance companies of any class, kind, or charac…

No automobile club or association shall do, or offer to do, business in the state unless the same shall be organized as a domestic or foreign corporation and shall be licensed by the commissioner. History: (Acts 1971, No. 407, p. 707, §799.)

All automobile clubs and associations now organized and/or operating in the State of Alabama and all automobile clubs and associations hereafter organized and/or operating in the State of Alabama shall be under the authority, supervision, and control of the commissioner. History:…

(a) The commissioner shall have full and complete authority to grant certificates of authorization to automobile clubs and associations, to revoke such certificates, and to prescribe such rules and regulations as are reasonably necessary for the conduct of the business of such cl…

License. (a) Within 30 days after January 1, 1972, every automobile club or association organized and/or operating in the State of Alabama shall file with the commissioner an application for a certificate of authority to continue said operations within the state, and every automo…

Persons representing any automobile club or association in soliciting automobile club or association memberships and the automobile club or association with respect thereto shall be subject to the provisions of Chapters 7 and 8A of this title, except that automobile club or assoc…

It shall be unlawful for any person, firm, association, copartnership, corporation, company, or other organization to organize, operate, or in any way solicit members for an automobile club or association or to offer any of the motor club services as defined in Section 27-39-1 ex…

For the purposes of this chapter, the following words and phrases shall have the following meanings: (1) INSURANCE PREMIUM FINANCE COMPANY. A person engaged in the business of entering into premium finance agreements. (2) PREMIUM FINANCE AGREEMENT. An agreement by which an insure…

A premium finance agreement may provide for the payment by the insured of the delinquency charge of $1.50 to a maximum of five percent of the delinquent installment which is in default for a period of five days or more. If the default results in the cancellation of any insurance …

(a) When a premium finance agreement contains a power of attorney enabling the premium finance company to cancel any insurance contract or contracts listed in the agreement, the insurance contract or contracts shall not be cancelled by the premium finance company unless such canc…

(a) Whenever a financed insurance contract is cancelled, the insurer shall return whatever gross unearned premiums are due under the insurance contract to the premium finance company, either directly or via the agent or surplus lines broker placing the insurance, for the account …

No filing of the premium finance agreement shall be necessary to perfect the validity of such agreement as a secured transaction as against creditors, subsequent purchasers, pledges, encumbrances, successors, or assigns. History: (Acts 1975, No. 1042, p. 2088, §13.)

When a premium finance company has complied with the licensing provisions of this chapter, it shall not be subject to any other licensing or regulatory agency of the State of Alabama other than the Department of Insurance. History: (Acts 1975, No. 1042, p. 2088, §14.)

Lines Broker; Issuance of Drafts, Etc.; Duties with Respect to Cancellation. (a) The amount of premium financed, more specifically referred to as “the principal balance” in paragraph c. of subdivision (3) of subsection (a) of Section 27-40-8, shall be sent to the insurance compan…

Finance Agreement. No premium finance company and no employee of such a company shall pay, allow, or offer to pay or allow in any manner whatsoever to the insurance agent, insurance broker, or managing general agent, or any employee of any of the aforesaid, or to any other person…

Any premium finance company which enters into a premium finance agreement under this chapter shall notify the insurer whose premiums are being financed of the existence of the agreement within a reasonable period of time, not to exceed 30 days after the date the agreement is acce…

Prior to the due date of the first installment payable under a premium finance agreement, the premium finance company holding the agreement shall deliver to the insured, or mail to him or her at his or her address as shown in the agreement, a copy thereof. History: (Acts 1986, No…

The provisions of this chapter shall not apply with respect to any of the following: (1) Any insurance company licensed to do business in this state. (2) Any banking or other financial institution regulated by the state, or savings and loan association, or credit union authorized…

(a) No person shall engage in the business of financing insurance premiums in this state without first having obtained a license as a premium finance company from the commissioner. Any person who shall engage in the business of financing insurance premiums in this state without f…

(a) Upon the filing of an application and the payment of the license fee the commissioner shall make an investigation of each applicant and shall issue a license if the applicant is qualified in accordance with this section. If the commissioner does not so find, he shall, within …

(a) The commissioner may revoke or suspend the license of any premium finance company when, and if, after complaint and investigation, it appears to the commissioner that: (1) Any license issued to such company was obtained by fraud; (2) There were any misrepresentations in the a…

(a) Every licensee shall maintain records of its premium finance transactions and the said records shall be open to examination and investigation by the commissioner. The commissioner may at any time require any licensee to bring such records as he may direct to the commissioner’…

The commissioner shall have authority to make and enforce such reasonable rules and regulations as may be necessary in making effective the provisions of this chapter, but such rules and regulations shall not be contrary to nor inconsistent with the provisions of this chapter. Hi…

(a) The contents and style of the premium finance agreement shall be as follows: (1) It shall be dated, signed by the insured or an authorized representative and the printed portion thereof shall be in at least eight-point type. (2) It shall contain the name and place of business…

(a) For the purpose of this section, “consumer insurance premium finance agreement” means an insurance premium finance agreement as defined in Section 27-40-1 wherein the insurance contracts which are the subject of the premium finance agreement are for personal, family, or house…

Except as provided in Section 27-41-39, this chapter shall apply to all domestic insurers and health maintenance organizations. History: (Acts 1977, No. 408, p. 530, §1; Acts 1993, No. 93-675, p. 1240, §13.)

Municipalities, Etc., to Provide Funds for Public Projects, Etc. An insurer may invest in bonds and other evidences of indebtedness which are obligations of any state, county, city, town, village, municipality, district, or other political subdivision of any state or of any instr…

Authorities. An insurer may invest in bonds, debentures, or other evidences of indebtedness of local public housing authorities existing under the laws of the United States or of any state if such obligations are: (1) Secured by a pledge of annual contributions unconditionally pa…

Federal Agencies. An insurer may invest in obligations issued or guaranteed by the following agencies of the United States of America: (1) Commodity Credit Corporation; (2) Federal intermediate credit banks; (3) Federal land banks; (4) Central bank for cooperatives; (5) Federal h…

Government, Provinces Thereof, Etc. An insurer may invest in bonds or other evidences of indebtedness issued, assumed, or guaranteed by Canada or any province thereof or issued by any municipality in Canada having a population of 25,000 or more. History: (Acts 1977, No. 408, p. 5…

for Reconstruction and Development and National Mortgage Association. (a) An insurer may invest in obligations issued, assumed, or guaranteed by the International Bank for Reconstruction and Development. (b) An insurer may invest in the obligations of the Federal National Mortgag…

Institutions Generally. An insurer may invest in secured and unsecured obligations bearing interest at a fixed rate, with mandatory principal and interest being due at specified times, of any solvent institution engaged in any lawful business and existing under the laws of the Un…

American Corporations. An insurer may invest in the preferred or guaranteed stocks or shares of any solvent corporation engaged in any lawful business and existing under the laws of the United States or any state thereof if the prior obligations of the issuing company or the guar…

of American and Canadian Corporations. (a) An insurer may invest in common stocks or shares of any solvent corporation engaged in any lawful business and existing under the laws of the United States or any state thereof or of Canada or any province thereof if the prior obligation…