Ala. Code § 27-31C-4 (1975) Issuance of License - Requirements

• Library: Alabama Statutes
• Edition: 2023
• Currency: Current with legislation from the 2023 Regular and Special Sessions.
• Year: 2023
• Citation: Ala. Code § 27-31C-4 (1975)

(a)

(1) The commissioner may not issue a license to an Alabama Coastal Captive Insurance Company unless the company possesses and maintains unimpaired paid-in capital of not less than one million dollars ($1,000,000); however, in the case of an Alabama Coastal Captive Insurance Company formed as a sponsored captive insurance company that does not assume any risk, where the risks insured by the protected cells are homogenous, the commissioner may reduce this amount to an amount not less than five hundred thousand dollars ($500,000).

(2)

a.

Except for an Alabama Coastal Captive Insurance Company formed as a sponsored captive insurance company that does not assume any risk, the capital must be in the form of cash, cash equivalent, or an irrevocable letter of credit issued by a bank chartered by this state or a member bank of the Federal Reserve System with a branch office in this state or as approved by the commissioner.

b. For an Alabama Coastal Captive Insurance Company formed as a sponsored captive insurance company that does not assume any risk, the capital also may be in the form of other high quality securities as approved by the commissioner.

(b) For the purposes of subsection (a), the commissioner may issue a license expressly conditioned upon the Alabama Coastal Captive Insurance Company providing to the commissioner satisfactory evidence of possession of the minimum required unimpaired paid-in capital. Until this evidence is provided, the captive insurance company may not issue a policy, assume any liability, or otherwise provide coverage. The commissioner summarily may revoke the conditional license without legal recourse by the company if satisfactory evidence of the required capital is not provided within a maximum period of time, not to exceed one year, to be established by the commissioner at the time the conditioned license is issued.