HB87 Summary: Alabama Preneed Funeral and Cemetery Act

• Strengthens consumer protections for preneed funeral and cemetery contracts by clarifying trust fund requirements, eliminating regulatory ambiguities, and expanding the Commissioner of Insurance's enforcement authority over unlicensed sellers.

• Escalates penalties for preneed violations, converting most non-felony violations to Class A misdemeanors and establishing tiered felony charges (Class B and C) based on contract amounts for unauthorized sales, improper trust deposits, and unauthorized fund withdrawals.

• Requires certificate holders to file semi-annual preneed activity reports and maintain detailed sales logs; shifts certificate renewal dates from April to July 1 and allows financial statement filing waivers under specific conditions.

• Mandates that all funds from preneed contracts be deposited in trust within 30 days and clarifies trust investment rules, including provisions for life insurance and annuity contracts as funding mechanisms with insured/annuitant consent requirements.

• Restricts cemetery endowment care fund trustees from also serving on cemetery boards of trustees and requires bonding; defines "net income" for endowment care purposes and clarifies which violations constitute felonies versus misdemeanors.