HB78 Summary

• Decreases the minimum interest rate for standard nonforfeiture law for individual deferred annuities from 1% to 15 basis points (0.15%), and exempts contingent deferred annuities from nonforfeiture requirements while authorizing the Commissioner to adopt rules for their benefits.

• Revises the Alabama Insurance Holding Company System Regulatory Act to require group capital calculations and liquidity stress tests, with confidentiality protections for this information shared with regulators and third-party consultants.

• Establishes procedures for group capital calculation filings with exemptions for certain insurance holding company systems and allows the lead state commissioner discretion on filing requirements based on regulatory oversight needs.

• Implements liquidity stress testing requirements aligned with NAIC framework, with scope criteria reviewed annually and confidentiality protections for stress test results and supporting documentation.

• Revises the Standard Valuation Law to refine small company alternative valuation provisions, allowing companies meeting certain premium thresholds to use simplified reserve calculations under the Valuation Manual rather than principle-based reserving requirements.