SB281 Alabama 2012 Session

Summary

Primary Sponsor

Ben H. Brooks

Republican

Co-Sponsors

Trip PittmanRusty Glover

Session

Regular Session 2012

Title

Alabama Insurance Underwriting Association, Coastal Area defined, credit for insurance writings in Coastal Area, Sec. 27-1-24 am'd.

Summary

SB281 defines the Coastal Area for the Alabama Insurance Underwriting Association and creates a two-unit credit system for voluntary insurance writings in that area with specific policy-type credits.

What This Bill Does

If enacted, the bill designates Coastal Area Zones 1–4 and splits voluntary writings into Unit One (Zones 1–3) and Unit Two (Zone 4). It sets credits of 100% for fire, 75% for homeowners and mobile homes, and 50% for commercial multi-perils, with credits calculated separately for each unit and excluding wind/hail and farm premiums. All member insurers would share in writings, expenses, profits, and losses in proportion to their net direct premiums, with credits applied to eligible Coastal Area writings.

Who It Affects

• Member insurers of the Alabama Insurance Underwriting Association, who would participate in the Coastal Area credit system and cost-sharing and apply credits to eligible writings.
• Policyholders in the Coastal Area (Zones 1–4) who could experience indirect changes in premiums or availability as a result of how insurer costs and credits are allocated.

Key Provisions

• Coastal Area defined to include Zones 1, 2, 3, and 4 as designated by the Alabama Insurance Underwriting Association.
• Voluntary writings in the Coastal Area are credited using two units: Unit One (Zones 1–3) and Unit Two (Zone 4). Credits are calculated separately for each unit and apply to specific policy types.
• Credit rates: 100% for fire insurance, 75% for homeowners and mobile homeowners, 50% for commercial multi-perils; premiums for wind/hail and farm policies are not eligible for credit.
• All association members participate in writings, expenses, profits, and losses in proportion to their net direct premiums written in Alabama.
• The association may carry over unexpended surpluses to future years (no lapsing or transfer to the General Fund) and may issue bonds or accept loans/grants.
• Effective date: the act becomes law on the first day of the third month after passage and approval.

AI-generated summary using openai/gpt-5-nano on Feb 25, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Insurance