Ala. Code § 27-29-3.1 (1975) Acquisition Involving Change In Control of Insurer Authorized to Do Business In Alabama; Pre-Acquisition Notification; Violation of Competitive Standards

• Library: Alabama Statutes
• Edition: 2023
• Currency: Current with legislation from the 2023 Regular and Special Sessions.

(a) The following definitions shall apply for the purposes of this section only:

(1) ACQUISITION. Any agreement or arrangement the consummation of which results in a person acquiring directly or indirectly the control of another person, and includes, but is not limited to, the acquisition of voting securities, the acquisition of assets, bulk reinsurance, and mergers.

(2) INVOLVED INSURER. Includes an insurer which either acquires or is acquired, is affiliated with an acquirer or acquired, or is the result of a merger.

(b)

(1) Except as exempted in subdivision (2), this section applies to any acquisition in which there is a change in control of an insurer authorized to do business in this state.

(2) This section shall not apply to the following:

a. A purchase of securities solely for investment purposes so long as the securities, by voting or otherwise, are not used to cause or attempt to cause the substantial lessening of competition in any insurance market in this state. If a purchase of securities results in a presumption of control under subsection (c) of Section 27-29-1, it is not solely for investment purposes unless the commissioner of the insurer's state of domicile accepts a disclaimer of control or affirmatively finds that control does not exist and the disclaimer action or affirmative finding is communicated by the domiciliary commissioner to the commissioner of this state.

b. The acquisition of a person by another person when both persons are neither directly nor through affiliates primarily engaged in the business of insurance, if pre-acquisition notification is filed with the commissioner in accordance with subdivision (1) of subsection (c) 30 days prior to the proposed effective date of the acquisition. However, such pre-acquisition notification is not required for exclusion from this section if the acquisition would otherwise be excluded from this section by any other paragraph of subdivision (2) of subsection (b).

c. The acquisition of already affiliated persons.

d.

1. An acquisition if, as an immediate result of the acquisition, any of the follow occurs:

(i) The combined market share of the involved insurers does not exceed five percent of the total market in any market.

(ii) There is no increase in any market share.

(iii) Both of the following do not occur in any market:

A. The combined market share of the involved insurers exceeds 12 percent of the total market.

B. The market share increases by more than two percent of the total market.