HB513 Alabama 2015 Session

Summary

Primary Sponsor

Randy Davis

Republican

Session

Regular Session 2015

Title

Insurance Underwriting Association, Board of Directors member selection, newly authorized insurers to become members, Sec. 27-1-24 am'd.

Summary

HB513 would require all insurers writing fire and extended coverage in Alabama to join the Alabama Insurance Underwriting Association, specify when newly authorized insurers join, and overhaul how the Association's Board of Directors is chosen and how coverage areas are defined in its plan of operation.

What This Bill Does

The bill makes AIUA membership mandatory for insurers writing fire and extended coverage and keeps them liable for contracts entered while they were members even if they withdraw. Newly authorized insurers would become members on November 1 after authorization. It requires the plan of operation to specify coverage territories. It also changes the Board of Directors to include specific seats for large wind insurers in Baldwin and Mobile counties, insurers chosen by the Commissioner, two producers, and four coastal business leaders, with terms and diversity considerations, and allows a representative of six member insurers to vote on their behalf.

Who It Affects

• Insurers authorized to write fire and extended coverage in Alabama — must join AIUA and maintain membership; newly authorized insurers join on November 1 after authorization.
• The Alabama Insurance Underwriting Association and its governance — changes to board composition, appointment processes, diversity requirements, and plan-of-operation rules (including defined coverage territories) affect how AIUA is run and how coverage areas are defined.

Key Provisions

• Amends Section 27-1-24 to require every insurer authorized to write fire and extended coverage in Alabama to be and remain a member of the Alabama Insurance Underwriting Association; withdrawal does not absolve liability for contracts entered during membership.
• Newly authorized insurers shall become members on November 1 next following the effective date of authorization.
• The plan of operation, articles of agreement, and rules and procedures govern membership and are subject to approval and public inspection.
• The Board of Directors shall include the Director of Risk Management plus: two member insurers with the largest average market share of voluntary wind coverage in Baldwin and Mobile Counties; four member insurers chosen by the Commissioner (with specific initial term lengths and at least one Alabama-domiciled insurer); two insurance producers with substantial experience (and geographic/dominance constraints); and four coastal business leaders with relevant experience and geographic considerations; terms vary initially and then are three years, with reappointment allowed and diversity considerations required in appointments.
• A representative of the six member insurers may be designated to act and vote on behalf of those insurers.
• The plan of operation must specify coverage territories (including the Beach Area as designated by the plan) and how these areas are defined and used.

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