HB32 Summary

• Implements reinsurance collateral provisions from U.S. covered agreements with the European Union and United Kingdom by amending Alabama's credit for reinsurance laws.

• Adds new Section 27-5B-8.1 establishing credit for reinsurance ceded to assuming insurers domiciled in "reciprocal jurisdictions" (non-U.S. jurisdictions with in-force covered agreements or EU member states, and certain U.S. jurisdictions meeting NAIC accreditation standards).

• Requires assuming insurers in reciprocal jurisdictions to maintain minimum capital and surplus, minimum solvency ratios, consent to Alabama court jurisdiction, and provide prompt notice of regulatory issues or capital deficiencies.

• Allows assuming insurers meeting reciprocal jurisdiction requirements to obtain reinsurance credit without posting collateral security, subject to commissioner oversight and conditions related to judgment enforcement and solvent schemes of arrangement.

• Applies to reinsurance agreements with inception, anniversary, or renewal dates at least six months after the effective date; effective January 1 following passage.