Alabama 2025 Regular Session

Alabama Senate Bill SB97 Compare Versions

Only one version of the bill is available at this time.

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1	1	SB97INTRODUCED
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3	3	SB97
4	4	1BE6L3L-1
5	5	By Senator Kitchens
6	6	RFD: Banking and Insurance
7	7	First Read: 05-Feb-25
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12	12	5 1BE6L3L-1 01/15/2025 FC (L)ma 2025-209
13	13	Page 1
14	14	First Read: 05-Feb-25
15	15	SYNOPSIS:
16	16	Under existing law, the Department of Insurance
17	17	licenses surplus line brokers. A nonresident may be
18	18	licensed as a surplus line broker for the same type of
19	19	insurance the broker is licensed to handle in the
20	20	nonresident's state.
21	21	Existing law requires an applicant for a
22	22	nonresident license to comply with the same
23	23	requirements as provided for a resident license which
24	24	includes an application, a license fee, and an
25	25	additional surety bond.
26	26	This bill would specify that the requirements
27	27	for licensure of a nonresident surplus line broker in
28	28	this state would include an application and a license
29	29	fee, but not an additional surety bond. This change is
30	30	proposed in order for Alabama to remain in conformance
31	31	with existing reciprocity provisions for the licensing
32	32	of nonresident insurance agents in this state.
33	33	A BILL
34	34	TO BE ENTITLED
35	35	AN ACT
36	36	Relating to the Department of Insurance and the
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64	64	28 SB97 INTRODUCED
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66	66	Relating to the Department of Insurance and the
67	67	licensing of a nonresident surplus line broker; to amend
68	68	Section 27-10-24 of the Code of Alabama 1975, as amended by
69	69	Act 2024-71 of the 2024 Regular Session, to further specify
70	70	the requirements for licensure of nonresident surplus line
71	71	brokers.
72	72	BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
73	73	Section 1. Section 27-10-24 of the Code of Alabama
74	74	1975, as amended by Act 2024-71, is amended to read as
75	75	follows:
76	76	"§27-10-24
77	77	(a) Any person licensed as a resident insurance
78	78	producer in this state for the property and casualty lines of
79	79	authority and deemed by the commissioner sufficiently
80	80	experienced in the insurance business may be licensed as a
81	81	surplus line broker for the same types of insurance that he or
82	82	she is currently licensed to handle as follows:
83	83	(1) ApplicationAn application shall be made on forms
84	84	designated and furnished submitted on a form as required by
85	85	the commissioner.
86	86	(2) AThe license fee required by Section 27-4-2 shall
87	87	be paid to the commissioner. The license shall expire on
88	88	December 31 next after its issue.
89	89	(3) Prior to the issuance of the license, the applicant
90	90	shall file with the commissioner a bond in favor of the State
91	91	of Alabama in the penal sum of at least fifty thousand dollars
92	92	($50,000), aggregate liability, with authorized corporate
93	93	sureties approved by the commissioner to remain in force for
94	94	the duration of the license or any renewal. The amount of the
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124	124	the duration of the license or any renewal. The amount of the
125	125	bond may be increased if deemed necessary by the commissioner,
126	126	considering the amount of surplus lines tax line taxes paid in
127	127	previous years. The bond shall be conditioned that the broker
128	128	will conduct business under the license in accordance with the
129	129	provisions of the surplus line insurance law and will promptly
130	130	remit the taxes as provided by the law. No bond shall be
131	131	terminated unless at least 30 days' prior written notice is
132	132	given to the broker and the commissioner.
133	133	(b) A business entity acting as a surplus line broker
134	134	shall designate each licensed individual producer acting under
135	135	the license, each of whom shall be responsible for the
136	136	business entity's compliance with the insurance laws, rules,
137	137	and regulations of this state. A separate fee shall be paid
138	138	for each individual producer acting under a business entity
139	139	license as surplus line broker, as in Section 27-4-2.
140	140	(c) A nonresident person may be licensed as a surplus
141	141	line broker for the same types of insurance that he or she is
142	142	currently licensed in good standing to handle in his or her
143	143	domiciled state, as follows:
144	144	(1) The nonresident shall comply with the requirements
145	145	established in subsection (a).
146	146	(1) An application shall be submitted on a form as
147	147	required by the commissioner.
148	148	(2) The license fee required by Section 27-4-2 shall be
149	149	paid to the commissioner. The license shall expire on December
150	150	31 next after its issue.
151	151	(2)(3) Each licensed nonresident surplus line broker
152	152	shall be considered to have performed acts equivalent to and
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182	182	shall be considered to have performed acts equivalent to and
183	183	constituting an appointment of the commissioner to receive
184	184	service of legal process issued against the nonresident in
185	185	this state upon causes of action arising within this state out
186	186	of transactions under the nonresident's surplus line broker
187	187	license. Service upon the commissioner shall constitute
188	188	effective legal service upon the nonresident.
189	189	(3)(4) The appointment shall be irrevocable for as long
190	190	as there may be any such cause of action in this state against
191	191	the nonresident.
192	192	(4)(5) Service of process under this section shall be
193	193	made by leaving three copies of the summons and complaint, or
194	194	other process, with the commissioner, along with payment of
195	195	the fee prescribed in Section 27-4-2, and the service shall be
196	196	sufficient service upon the nonresident if notice of the
197	197	service and a copy of the summons and complaint or other
198	198	process are sent by registered or certified mail to the
199	199	defendant by the commissioner. The defendant's return and the
200	200	certificate of the commissioner certifying compliance herewith
201	201	shall be filed in the office of the clerk of court, or in the
202	202	court or tribunal wherein the action is pending. The
203	203	certificate of the commissioner shall show the date of the
204	204	mailing by registered or certified mail of the notice of the
205	205	service and copy of the summons and complaint, or other
206	206	process, to the nonresident defendant and the date of the
207	207	receipt of the return card and shall be signed by the
208	208	commissioner. The commissioner may give the nonresident
209	209	defendant notice of the service upon him or her, in lieu of
210	210	the notice of service provided for herein to be given in this
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240	240	the notice of service provided for herein to be given in this
241	241	subdivision by registered or certified mail, in the following
242	242	manner:
243	243	a. By having a notice of service and a copy of the
244	244	summons and complaint, or other process, served upon the
245	245	nonresident defendant, if found within the State of Alabama,
246	246	by any officer duly qualified to serve legal process within
247	247	the State of Alabama or, if the nonresident defendant is found
248	248	to be outside of the State of Alabama, by a sheriff, deputy
249	249	sheriff, or United States marshal or deputy United States
250	250	marshal, or any duly constituted officer qualified to serve
251	251	like process in the state or the jurisdiction where the
252	252	nonresident defendant is found.
253	253	b. The officer's return showing service, when made,
254	254	shall be filed in the office of the clerk of the court, or in
255	255	the court or tribunal wherein the action is pending, on or
256	256	before the return day of the process or as the court or
257	257	tribunal may allow, and the court or tribunal in which the
258	258	action is pending may order a continuance, or continuances, as
259	259	may be necessary to afford the nonresident defendant
260	260	reasonable opportunity to defend the action.
261	261	(5)(6) The commissioner shall keep on file for a period
262	262	of not less than three years a copy of the summons and
263	263	complaint or other process served upon the commissioner,
264	264	together with a record of all such process and of the day,
265	265	hour, and manner of service."
266	266	Section 2. This act shall become effective immediately.
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