(a) The council, commission or similar governing body of each municipal corporation, the board of directors of each incorporated municipal board, the county commission of each county, the board of education of each city and the board of education of each county, now existing or established after August 16, 1947, shall have power and authority to contract for and obtain and maintain policies of group life, health, accident and hospitalization insurance or any one or more of them and shall have power and authority to contract for and obtain and maintain individual annuity contracts, retirement income policies or group annuity contracts to provide a retirement plan for the benefit of such of the officers and employees of such municipality, incorporated municipal board, county or board as may be determined by such governing body and as shall or may elect to accept the same and who have authorized in writing such governing body to make deductions from their compensation to pay premiums on any such policy or policies if such premiums are payable in whole or in part by such officer or employee.

(b) The term "insurance" as used in this chapter includes the term "annuity," and the term "policy" includes the term "contract."

(a) All such governing bodies shall have authority to contract for and purchase any or all such policies of insurance from any insurer or insurers admitted to transact the business of such insurance in the State of Alabama, and the governing bodies of all state colleges and universities shall have, in addition to powers previously granted, the authority to contract for and purchase any or all such policies of insurance from any nonprofit corporation organized and operated without profit to any private shareholder or individual exclusively for the purpose of aiding or strengthening educational institutions by issuing insurance and annuity contracts only to or for the benefit of such institutions and individuals engaged in the services of such institutions.

(b) The amounts of insurance under any such policy must be based upon some plan precluding individual selection either by such officers and employees or by the governing body.

(c) The coverage of any such policy may be limited to specified classes of officers and employees determined by conditions pertaining to employment, but there shall be no discrimination within any such specified class.

It is hereby declared to be the intent of the Legislature that any such governing bodies shall have the power and authority to determine in their sole discretion the class or classes of officers or employees who are to be insured under any such policy or policies, the amount, nature and kind of insurance upon each such officer and employee and class thereof and whether the premium therefor shall be paid in whole or in part by such governing bodies and, if in part, the amount thereof that will be so paid.

Such governing bodies shall have authority to pay all or such part of the premium for such insurance as such governing bodies shall determine out of any available funds and to deduct that part of the premium, if any, which is to be paid by such officer or employee from the salary or wage of such officer or employee as may be authorized by him and to pay such deductions together with the remainder due of such premium to the insurer issuing such policy in full payment of the premium.

In the event there is a return of premium by any insurance company under any such insurance contract, such return shall be made to the governing body paying such premium.

Any such governing bodies may appropriate sufficient funds to carry out the provisions of this chapter.

All contracts and policies of group life, health, accident and hospitalization insurance or any one or more of them which have been issued prior to August 16, 1947, to any municipal corporation, county, city or county board of education or any state agency or institution of education, learning, training or correction or for the delinquent, insane, sick, deaf, dumb, blind, needy, juvenile or aged for the benefit of its officers and employees or any portion of them are hereby ratified, confirmed, approved and validated.

All acts done and all premiums paid by any such municipal corporation, county, board, agency or institution in accordance with the terms of any such contract or policy are hereby ratified, confirmed, approved and validated.

The governing body of any county, municipality, or a public agency which is an employer participating in the Employees' Retirement System pursuant to Section 36-27-6, or in the local government health insurance program of the State Employees' Insurance Board may, upon a majority vote of its members, elect to allow the retired employees of such a county, municipality, or public agency to participate in any health, hospitalization, surgical, or medical insurance program made available to regular employees, or any related health program for retirees selected by the governing body including the local government health program offered by the State Employees' Insurance Board. Such a county, municipality, or public agency may pay all, or any part, or none of the cost thereof or the premiums thereon for current or future retirees from any funds in the county, municipal, or public agency treasury not otherwise appropriated.