HB225 Alabama 2013 Session

Summary

Primary Sponsor

David SessionsSenator

Republican

Co-Sponsors

Elaine BeechKen JohnsonMike HillJoe FaustVictor GastonGreg WrenSteve McMillanJames E. BuskeyGreg BurdineRandy DavisRichard J. LairdChad FincherHarry ShiverJamie IsonNapoleon BracyPebblin W. WarrenJim BartonJay LoveK.L. BrownRod ScottAlan BakerJim PattersonMike MillicanWayne Johnson

Session

Regular Session 2013

Title

Insurance, out-of-state insurers, investments, cash equivalents exempted from quality and diversity requirements, Sec. 27-41-39 am'd.

Summary

HB225 would exempt cash equivalents from the quality and diversity requirements for investments by foreign and alien insurers authorized to transact in Alabama.

What This Bill Does

The bill preserves that foreign or alien insurers must invest in a way that is substantially equivalent in quality and diversity to domestic insurers. It adds a specific exemption for cash equivalents from these investment limitations. It defines cash equivalents as short-term, highly rated, liquid investments (90 days or less) that are easily converted to cash with minimal risk of value change.

Who It Affects

• Foreign or alien insurers authorized to transact insurance in Alabama—gain an exemption for cash equivalents from the usual quality and diversity limits.
• Alabama policyholders and the broader Alabama insurance market—could be affected by changes in insurers' investment practices and liquidity, which are overseen by regulators.

Key Provisions

• Amends Section 27-41-39 to require investments by foreign or alien insurers to be of quality and diversity substantially equivalent to that required of like domestic insurers.
• Adds an exemption: cash equivalents are not subject to the limitations of this section.
• Defines cash equivalents as investments with 90 days or less to maturity, highly rated by a nationally recognized rating organization recognized by the Commissioner of Insurance, highly liquid, readily convertible to known amounts of cash without penalty, and near maturity with insignificant risk of value change.
• Effective date: becomes law immediately following passage and approval by the Governor.

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