SB245 Summary

• Adds Chapter 5B to Title 27 of Alabama Code to comprehensively regulate reinsurance and credit for reinsurance, aligning state law with the National Association of Insurance Commissioners Credit for Reinsurance Model Law.

• Establishes five categories of qualified reinsurers (licensed, accredited, domiciled in similar jurisdictions, maintaining trust funds, and certified reinsurers) that allow domestic insurers to receive credit against reserve requirements.

• Requires non-U.S. reinsurers providing security to fund U.S. obligations to maintain assets in the United States subject to state insurance commissioner oversight and liquidation procedures.

• Establishes requirements for reinsurer qualification including minimum capital/surplus of $20 million, financial strength ratings, submission to state jurisdiction, and maintenance of trust funds with qualified U.S. financial institutions.

• Repeals existing Section 27-5-12 and becomes effective January 1 following passage and gubernatorial approval.