HB327 Alabama 2011 Session

Summary

Primary Sponsor

Mike Hill

Republican

Session

Regular Session 2011

Title

Insurance Department, casualty insurance companies, capital requirements required, subject to certain action level events, Secs. 27-2B-2, 27-2B-3, 27-2B-4 am'd.

Summary

HB327 would extend Alabama's risk-based capital company action level rules to property and casualty insurers and set up required corrective plans and regulatory steps when those levels are reached.

What This Bill Does

It adds property and casualty insurers to the triggers for a company action level event based on risk-based capital (RBC) levels. If an RBC report shows the specified levels, the insurer must file an RBC plan with corrective actions and financial projections for the current year and the next four years. The regulator can approve, require revisions to, or treat a plan as unsatisfactory, potentially leading to regulatory actions; the regulator can also adjust RBC reports if needed. The bill also changes certain definitions, requires RBC reports to be filed with the NAIC and other states on request, and becomes effective January 1, 2012.

Who It Affects

• Property and casualty insurers licensed to do business in Alabama (including domestic and foreign insurers) — would be subject to company action level events and must file RBC plans with corrective actions when triggered, plus submit RBC reports to NAIC and other states upon request.
• The Alabama Insurance Department and other state regulators — gain authority to adjust RBC reports, review and decide on the adequacy of RBC plans, and potentially impose regulatory actions if plans are unsatisfactory.

Key Provisions

• Extends 'company action level event' triggers to property and casualty insurers, using specified RBC level relationships to determine when action is required.
• Requires an RBC plan within 45 days of a company action level event, including conditions causing the event, corrective actions, five-year financial projections (with and without proposed actions), key assumptions, and risk factors.
• Regulator review process: the commissioner reviews the RBC plan within 60 days, can deem it unsatisfactory and require revisions, and may designate a regulatory action level event if needed.
• If an RBC plan is filed or revised, the insurer must file copies in other states where it is authorized to do business under certain conditions.
• RBC reports and adjusted RBC reports can be revised by the commissioner to correct inaccuracies, with notices explaining the reasons for adjustments.
• Definitions and clarifications for RBC-related terms (e.g., domestic/foreign insurer, adjusted RBC, RBC instructions) are updated, along with a non-substantive citation correction.
• Effective date: January 1, 2012.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Insurance