Bill > HB415

This bill, titled the Department of Insurance; additional requirements for captive insurers specified, proposes several amendments to Alabama law concerning captive insurance companies, which are essentially insurance companies created and owned by a parent company or organization to insure its own risks. The bill introduces new requirements for these companies, including mandating that they make adequate arrangements with an in-state bank for money transfers, employ or contract with a qualified captive manager, a certified public accountant, and actuaries approved by the commissioner, and submit detailed operational plans, financial statements, and background information for key personnel. It also clarifies that captive insurers cannot provide personal motor vehicle coverage and specifies that homeowner's insurance can only be written by an Alabama Coastal Captive Insurance Company in designated coastal areas. Furthermore, the bill increases the minimum capital and surplus requirements for various types of captive insurers, such as pure captive insurers and protected cell captive insurers, and introduces a higher minimum for reinsurance captive insurers and risk retention groups. It also refines the process for obtaining a certificate of good standing from the commissioner, requiring consideration of the competence of captive managers, legal counsel, and the overall business plan. Finally, the bill adjusts the premium tax rates for captive insurers, with changes to the tax structure and a revised minimum tax amount, and sets different effective dates for its provisions.

Business and Industry

https://alison.legislature.state.al.us/bill-search