SB335 Alabama 2013 Session

To repeal portions of Title 27 of the Code of Alabama 1975

Relating to the Alabama Insurance Code, to repeal the following: 27-3-21 (a) The commissioner may, in his discretion, suspend or revoke an insurer's certificate of authority if, after a hearing thereon, he finds that the insurer has willfully violated any material provision of this title other than those for which suspension or revocation is mandatory or has failed to pay applicable taxes with respect to a preceding calendar year as required by this title. (b) The commissioner shall, after a hearing thereon, suspend or revoke an insurer's certificate of authority if he finds that the insurer: (1) Is in unsound condition, or is in such condition or is using such methods and practices in the conduct of its business as to render its further transaction of insurance in this state hazardous to its policyholders or to the public; (2) Has refused to be examined or to produce its accounts, records, and files for examination or if any of its officers or agents have refused to perform any legal obligation relative thereto or have refused to give information with respect to its affairs when required by the commissioner; (3) Has failed to pay any final judgment entered against it in this state within 30 days after the judgment became final, or within 30 days after the time for taking an appeal has expired or within 30 days after dismissal of appeal before final termination, whichever date is later; (4) With such frequency as to indicate its general business practice in this state: a. Has, without just cause, refused to pay proper claims arising under coverages provided by its policies, whether the claim is in favor of an insured or is in favor of a third person with respect to liability of an insured to such third person; or b. With like frequency and without just cause, compels insureds or claimants in this state to accept less than the amount due them or compels them to employ attorneys or to bring an action against the insurer or such an insured to secure full payment or settlement of such claims; provided, that as a condition precedent to a revocation or suspension of the insurer's certificate of authority under this subsection there has been a prior determination that the insured has engaged in an unfair method of competition or an unfair act or practice in the business of insurance; or (5) Is affiliated with and under the same general management or interlocking directorate or ownership as another insurer which transacts direct insurance in this state without having a certificate of authority therefor, except as permitted as to surplus line insurers under Chapter 10 of this title. (c) The commissioner may, in his discretion and without advance notice on a hearing thereon, immediately suspend the certificate of authority of any insurer as to which proceedings for receivership, conservatorship, rehabilitation, or other delinquency proceedings have been commenced in any state by the insurance supervisory official of such state. 27-3-22 (a) Suspension or revocation of an insurer's certificate of authority shall be by the commissioner's order given to the insurer as provided by Section 27-2-18. The commissioner shall promptly also give notice of such suspension or revocation to the insurer's agents in this state of record in the commissioner's office. The insurer shall not solicit or write any new coverages in this state during the period of any such suspension or revocation. (b) In his discretion, the commissioner may cause notice of any such revocation to be published in one or more newspapers of general circulation published in this state. (c) Upon revocation or suspension of the certificate of authority of a surety insurer, the commissioner shall so notify each officer in this state authorized to approve official bonds by circular letter stating the grounds of such suspension or revocation. 27-3-23 (a) Suspension of an insurer's certificate of authority shall be for such period as is fixed by the commissioner in the order of suspension, but not to exceed one year from the date of suspension, unless the commissioner shortens or rescinds such suspension or the order upon which the suspension is based is modified, rescinded, or reversed. (b) During the period of suspension the insurer shall file its annual statement, pay fees, licenses and taxes as required under this title as if the certificate had continued in full force, and it may service its outstanding policies and adjust losses thereunder. (c) Upon expiration of the suspension period, if within such period the certificate of authority has not otherwise terminated, the insurer's certificate of authority shall automatically reinstate unless the commissioner finds that the causes of the suspension have not been removed or that the insurer is otherwise not in compliance with the requirements of this title, of which the commissioner shall give the insurer notice not less than 30 days in advance of the expiration of the suspension period. If not so automatically reinstated, the certificate of authority shall be deemed to have expired as of the end of the suspension period or upon failure of the insurer to continue the certificate during the suspension period, whichever event first occurs. (d) Upon reinstatement of the insurer's certificate of authority, the authority of its agents in this state to represent the insurer shall likewise reinstate. The commissioner shall promptly notify the insurer and its agents in this state of record in the department of such reinstatement. 27-3-24 (a) Each insurer applying for a certificate of authority to transact business in this state shall file with the commissioner an appointment of the commissioner and his successors in office, on a form as furnished by the commissioner, as its attorney upon whom may be served all lawful process in any action or proceeding against it in this state and therein shall agree that any such process served upon such attorney shall be of the same force and validity as if served on the insurer. The appointment shall be irrevocable, shall bind the insurer and any successor in interest or to the assets or liabilities of the insurer and shall remain in effect as long as there is outstanding in this state any obligation or liability of the insurer resulting from its transactions therein. (b) At the time of such appointment of the commissioner as its process agent, the insurer shall file with the commissioner designation of the name and address of the person to whom process against it served upon the commissioner is to be forwarded. The insurer may change such designation by a new filing. 27-3-25 (a) Service of process upon the commissioner as process agent of the insurer under Section 27-3-24 shall be made by the proper officer of Montgomery County by serving copies in triplicate of the process upon the commissioner or upon his assistant, deputy or other person in charge of his office. Upon receiving such service, the commissioner shall