(a) No person shall act as an insurer and no insurer shall transact insurance in this state unless so authorized by a subsisting certificate of authority issued to it by the commissioner, except as to such transactions as are expressly otherwise provided for in this title.

(b) No insurer shall from offices or by personnel or facilities located in this state solicit insurance applications or otherwise transact insurance in another state or country unless it holds a subsisting certificate of authority issued to it by the commissioner authorizing it to transact the same kind or kinds of insurance in this state.

(a) For the purposes of this section, the following words and phrases shall have the following meanings:

(1) DOMESTIC STOCK INSURER. A corporation incorporated under the laws of the State of Alabama with its capital divided into shares and owned by its stockholders which is engaged as indemnitor, surety or contractor in the business of entering into contracts of insurance.

(2) CAPITAL SURPLUS. Such term shall have the meaning given thereto in the statutes of this state relating to the powers and procedures of domestic private corporations formed for profit.

(3) EARNED SURPLUS. Such term shall have the meaning given thereto in the statutes of this state relating to the powers and procedures of domestic private corporations formed for profit.

(b) A domestic stock insurer which has the minimum unimpaired paid-in capital stock required for the transaction of insurance by such domestic stock insurer by the statutes of this state governing domestic stock insurers may, by resolution of its board of directors, apply any part, or all, of its capital surplus to the reduction or elimination of any deficit, however incurred, but only after first eliminating the then earned surplus, if any, of the domestic stock insurer by applying such earned surplus against such deficit. Each such application of capital surplus shall, to the extent thereof, effect a reduction of capital surplus.

(a) The commissioner shall not issue or permit to exist a certificate of authority as to any insurer, other than an alien insurer, unless it has deposited and maintains deposited in trust with the treasurer of this state cash or securities eligible under Section 27-6-3 and having a value at all times of not less than $100,000.00 or the minimum paid-in capital stock, if a stock insurer, or surplus, if a mutual or reciprocal insurer, required to be maintained by the insurer under this title for authority to transact the kinds of insurance to be transacted, whichever is the smaller amount.

(b) The deposit shall be for the general benefit and protection of the insurer's policyholders or its policyholders and creditors.

(c) In lieu of such deposit, or part thereof, in this state of a foreign insurer, the commissioner shall, subject to the retaliatory law, Section 27-3-29, accept the current certificate in proper form of the public official having supervision over insurers in any other state to the effect that a like deposit, or part thereof, of such insurer, comprised of cash or securities of substantially the same character as required under subsection (a) of this section, of similar deposits in this state, is being maintained under law in public custody or control in such state in trust for the purpose, among other reasonable purposes of protection of policyholders or policyholders and creditors, of the protection of all the insurer's policyholders or of its policyholders and creditors in this state.

(d) All such deposits in this state shall be subject to the applicable provisions of Chapter 6 of this title.

(e) Any insurance company, with respect to its general account or separate accounts, is authorized to deposit or arrange for the deposit of securities which it may own in a clearing corporation, as defined in Section 7-8-102(3), or in a federal reserve bank under the book-entry system. When such securities are so deposited, certificates representing securities of the same class of the same insurer may be merged and held in bulk in the name of the nominee of such clearing corporation with any other securities deposited in such clearing corporation by any person, regardless of the ownership of such securities, and securities of small denominations may be merged into one or more certificates of larger denominations. Title to such securities may be transferred by bookkeeping entry on the books of such clearing corporation or federal reserve bank without physical delivery of certificates representing such securities. Any company making deposits by means of such securities shall provide to the commissioner evidence customarily issued by federal reserve banks and clearing corporations establishing that the securities are actually recorded in a book-entry account or actually held in safekeeping by a clearing corporation. Securities deposited in a clearing corporation or in a book-entry account and used to meet the deposit requirements under the insurance laws of this state shall be under the control of the commissioner and shall not be withdrawn by the insurance company without the approval of the commissioner.

(a) In addition to the deposit required under Sections 27-3-11 or 27-3-14, a surety insurer shall deposit and maintain deposited with the treasurer of this state in trust for the benefit of holders, resident in this state, of the obligations of the insurer cash or securities eligible under Section 27-6-3 having a value at all times of at least $50,000.00; except, that a domestic surety insurer may take credit for the amount of such special deposit against the deposit otherwise required of it under Section 27-3-11, and except that a foreign insurer showing a deposit pursuant to subsection (c) of Section 27-3-11 in the amount of $200,000.00 shall not be required to comply with this section.

(b) Such deposits shall be subject to the applicable provisions of Chapter 6 of this title.

(a) For authority to transact such insurance in this state, a foreign title insurer shall have and maintain on deposit in this state for the better protection of its guaranty holders and creditors, resident in this state, under its contracts of title insurance, cash and securities eligible under Section 27-6-3 having a value at all times of not less than $50,000.00. The deposit shall be so made and maintained in trust with a bank or trust company located in this state, approved by the commissioner, having a capital and surplus of not less than $500,000.00.

(b) At its option, a domestic title insurer may maintain a deposit in like manner, amount, character and for like purposes as required for foreign insurers under subsection (a) of this section.

(c) Such deposits shall be subject to the applicable provisions of Chapter 6 of this title.

(a) An alien insurer shall not have authority to transact insurance in this state unless it has and maintains within the United States as deposits with trustees, public depositaries or in trust institutions approved by the commissioner under Section 27-3-15 assets available for discharge of its United States insurance obligations, which assets shall be in amount not less than the outstanding liabilities of the insurer arising out of its insurance transactions in the United States together with the greater of the following sums:

(1) The largest deposit required by Section 27-3-11 to be made by foreign insurers transacting like kinds of insurance; or

(2) $300,000.00.

(b) Of the amount deposited by an alien insurer, an amount not less than that required under subdivisions (a)(1) or (a)(2) of this section shall be deposited and maintained on deposit in cash or securities eligible for deposit under Section 27-6-3 with the treasurer of this state or with or through the public official having supervision of insurance in another state and shall be held in trust exclusively for the benefit and protection of the insurer's policyholders or policyholders and creditors in the United States.

(c) The amount so held on deposit under subdivisions (a)(1) or (a)(2) of this section shall, for the purposes of this title, be deemed to be the paid-in capital, if a stock insurer, or minimum surplus, if a mutual insurer, of the insurer required to be maintained.

(d) If the insurer transacts surety insurance in this state, it shall make and maintain in this state the special deposit required under Section 27-3-12.

(e) Any such deposit made in this state shall be subject to the applicable provisions of Chapter 6 of this title; except, that if this state is the state of entry into the United States of the alien insurer the deposit shall be subject to the provisions of Chapter 33 of this title.

(a) In order to comply with the requirements of Section 27-3-14, an alien insurer shall appoint citizens of the United States of America or public depositaries or trust institutions located in the United States, all as approved by the commissioner, as trustee, or trustees, to hold its funds and assets in trust for the benefit of its policyholders or policyholders and creditors in the United States. Any such trustee, or trustees, shall be named by the board of directors or comparable directive body of the insurer, and a certified copy of the record of the appointment and of the deed of trust shall be filed with the commissioner.

(b) Funds and assets so held, to the extent that they consist of cash, securities and other assets of the same general character as are eligible for the investment of like funds of a domestic insurer, under Sections 27-1-8 and 27-1-9, shall constitute the assets of the insurer for the purposes of this title.

(c) Such trustees and assets, and all accounts and records relating thereto, shall be subject to examination by the commissioner in the same manner as the officers, agents, assets and affairs of insurers.

(d) Trusteed assets of an alien insurer using this state as its state of entry into the United States shall be subject to Chapter 32 of this title.

Aggregations of individuals as underwriters, whether domestic, foreign or alien, assuming insurance risks upon the plan known as 'Lloyd's,' whereby each underwriter is liable for the proportionate part assumed by him of the whole amount so insured by a policy issued by such underwriters, may be authorized to transact any kind, or kinds, of insurance in this state other than life or title insurances if the insurer is otherwise in compliance with this title, subject to the following conditions:

(1) If a foreign or alien insurer, it must have successfully been in business as an authorized insurer in the state or country of domicile for at least 10 years.

(2) If a domestic insurer, it must file with the commissioner evidence, satisfactory to him, that it has been soundly organized and that its insurance operations will, at all times, be competently conducted by individuals having the necessary experience in insurance underwriting and management to do so, that at all times it will be comprised of not less than 30 individual 'underwriters,' that no such underwriter shall retain risk as to any one subject of insurance in amount exceeding two percent of his total net worth and that the liability of such underwriter, as to any such risk within the extent and amount of coverage provided by the amount of insurance, is unlimited. For the purpose of determining compliance with this provision, the commissioner may at any time require any and all such underwriters to file with him their individual financial statements, duly certified and sworn to under oath, in such form and scope of contents as the commissioner may reasonably require. The assets and insurance transactions of any or all such underwriters shall be subject to examination by the commissioner under the same conditions as apply to domestic insurers in general under Chapter 2 of this title.

(3) Such an insurer shall otherwise be subject to the same applicable requirements and obligations as apply under this title to a stock insurer transacting like kinds of insurance; and for the purposes of this title such an insurer's deposit made and maintained as required under Section 27-3-11 or subdivision (a)(1) or (a)(2) of Section 27-3-14 shall be deemed to be the minimum capital required to be maintained by such an insurer, but subject to the requirements of Section 27-3-8 as to surplus.

To apply for an original certificate of authority an insurer shall file with the commissioner its application therefor, accompanied by the applicable fees as specified in Section 27-4-2, showing its name, location of its home office or, if an alien insurer, principal office in the United States, kinds of insurance to be transacted, state or country of domicile and such additional information as the commissioner may reasonably require, together with the following documents, as applicable:

(1) A copy of its corporate charter, articles of incorporation or other charter documents with all amendments thereto, certified by the public officer with whom the originals are on file in the state or country of domicile;

(2) If a mutual insurer, a copy of its bylaws, as amended, certified by its secretary or other officer having custody thereof;

(3) If a foreign reciprocal insurer, copies of the power of attorney of its attorney-in-fact or its subscribers' agreement, certified by its attorney-in-fact, and if a domestic reciprocal insurer, the declaration provided for by Section 27-31-7;

(4) A copy of its financial statement as of December 31, next preceding, on the 'convention' form as then currently in general use for similar insurers, sworn to by at least two executive officers of the insurer or certified by the public insurance supervisory official of the insurer's state of domicile or of entry into the United States;

(5) Copy of report of last examination, if any, made of the insurer, certified by the insurance supervisory official of its state of domicile or of entry into the United States;

(6) Appointment of the commissioner pursuant to Section 27-3-24 as its attorney to receive service of legal process;

(7) If a foreign or alien insurer, a certificate of the public official having supervision of insurance in its state, or state of entry into the United States or country of domicile showing that it is legally organized and is authorized to transact the kinds of insurance proposed to be transacted in this state;

(8) If an alien insurer, a copy of the appointment and authority of its United States manager, certified by its officer having custody of its records;

(9) Evidence satisfactory to the commissioner of any deposit required under Sections 27-3-11, 27-3-12, 27-3-13 or 27-3-14; and

(10) If other than a life insurer, the affidavit, on a form furnished by the commissioner, of the insurer's president or other chief officer that it has not violated any of the provisions of Section 27-3-27 during the preceding 12 months and an agreement that the insurer accepts the terms and the obligations of such section as part of the consideration for authority to transact insurance in this state.

(a) If upon completion of the application for a certificate of authority the commissioner finds that the insurer has met the requirements for and is entitled thereto under this title, he shall issue to the insurer a proper certificate of authority; if he does not so find, the commissioner shall issue his order refusing such certificate. The commissioner shall act upon an application for a certificate of authority within a reasonable period after its completion.

(b) The certificate, if issued, shall specify the kind, or kinds, of insurance the insurer is authorized to transact in this state. At the insurer's request, the commissioner may issue a certificate of authority limited to particular types of insurance or insurance coverages within the scope of a kind of insurance as defined in Chapter 5 of this title.

(c) Although issued to the insurer, the certificate of authority is at all times the property of the State of Alabama. Upon any expiration, suspension or termination thereof, the insurer shall promptly deliver the certificate of authority to the commissioner.

(a) Certificates of authority issued or renewed under this title shall continue in force as long as the insurer is entitled thereto under this title and until suspended, revoked or terminated at the request of the insurer; subject, however, to continuance of the certificate by the insurer each year by:

(1) Payment prior to March 1 of the continuation fee provided in Section 27-4-2; and

(2) Due filing by the insurer of its annual statement for the calendar year preceding as required under Section 27-3-26.

(b) If not so continued by the insurer, its certificate of authority shall expire at midnight on the May 31, next following, such failure of the insurer so to continue it in force. The commissioner shall promptly notify the insurer of the occurrence of any such failure resulting in impending expiration of its certificate of authority.

(c) The commissioner may, in his discretion, reinstate a certificate of authority which the insurer has inadvertently permitted to expire, after the insurer has fully cured all its failures which resulted in such expiration and upon payment by the insurer of the fee for reinstatement, in addition to the current continuation fee, in the amounts provided in Section 27-4-2. Otherwise, the insurer shall be granted another certificate of authority only after filing application therefor and meeting all other requirements as for an original certificate of authority in this state.

(d) The commissioner may amend a certificate of authority at any time to accord with changes in the insurer's charter or insuring powers.

A certificate of authority shall not be required of an insurer with respect to the following:

(1) Transactions relative to its policies lawfully written in this state or liquidation of assets and liabilities of the insurer, other than collection of new premiums, all as resulting from its former authorized operations in this state;

(2) Transactions thereunder subsequent to issuance of a policy covering only subjects of insurance not resident, located or expressly to be performed in this state at time of issuance and lawfully solicited, written or delivered outside this state;

(3) Transactions pursuant to surplus lines coverages lawfully written under Chapter 10 of this title; and

(4) Reinsurance.

(a) The commissioner shall suspend or revoke an insurer's certificate of authority:

(1) If such action is required by any provision of this title;

(2) If the insurer no longer meets the requirements for the authority originally granted on account of deficiency of assets or otherwise; or

(3) If the insurer's authority to transact insurance is suspended or revoked by its state of domicile or state of entry into the United States if an alien insurer.

(b) Except in cases of insolvency or impairment of required capital or surplus or suspension or revocation by another state as referred to in subdivision (a) (3) of this section, the commissioner shall give the insurer at least 10 days' notice in advance of any such suspension or revocation under this section and of the particulars of the reasons therefor. If the insurer requests a hearing thereon within such 10 days, such request shall automatically stay the commissioner's proposed action until his order is made on such hearing.

(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.

(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.

(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.

(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.

(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 promptly forward a copy thereof by certified mail or registered mail, with return receipt requested, to the person last designated by the insurer to receive the same, as provided under subsection (b) of Section 27-3-24, return one copy with his admission of service and retain one copy in the files of the department. The commissioner shall keep a record of all actions filed against insurers wherein process is served on the commissioner, noting the name of the insurer, the date of service and the type of action.

(b) Where process is served upon the commissioner as an insurer's process agent, the insurer shall not be required to answer or plead except within 30 days after the date upon which the insurer's designee received the copy of the process mailed by the commissioner, as shown by the return receipt therefor referred to in subsection (a) of this section.

(c) Process served upon the commissioner, and copy thereof forwarded as in this section provided, shall for all purposes constitute valid and binding service thereof upon the insurer.

(d) This section shall not be deemed to prohibit service of process upon an insurer by any other method provided for by law.

Every property or casualty insurer required to file an annual statement with the commissioner on March 1 of each year preceding, pursuant to Section 27-3-26, shall include a statement of a qualified independent loss reserve specialist setting forth his or her opinion relating to loss and loss adjustment expense reserves. For the purposes of this section, a qualified independent loss reserve specialist shall mean a person who is not a principal, director, or indirect owner of the insurer and is a member of the Casualty Actuarial Society, or has such other actuarial experience as is acceptable to the commissioner to assure a professional opinion on the adequacy of loss and loss adjustment expense reserves.

(a) Each authorized insurer shall, annually on or before March 1, or within such extension of time not exceeding 30 days after March 1 as the commissioner for good cause shown may grant as to a particular insurer, file with the commissioner a full and true statement of its financial condition, transactions and affairs as of the December 31, preceding. The statement shall be in such general form and context as is in current use for similar reports to states in general with respect to the type of insurer and kinds of insurance to be reported upon and as supplemented by additional information required by the commissioner. The statement shall be verified by the oath of the insurer's president or vice-president and secretary or actuary as applicable or, if a reciprocal insurer, by the oath of the attorney-in-fact or its like officers if a corporation.

(b) The statement of an alien insurer shall be verified by the insurer's United States manager or other officer duly authorized and shall relate only to its transactions and affairs in the United States, unless the commissioner requires otherwise. If the commissioner requires a statement as to the alien insurer's affairs throughout the world, the insurer shall file such statement with the commissioner as soon as reasonably possible.

(c) The commissioner may in his discretion suspend or revoke the certificate of authority of an insurer failing to file its annual statement when due. In addition the insurer shall be subject to a penalty of $250.00, such penalty to be collected by the commissioner, if necessary, by a civil action therefor brought by the commissioner in the Circuit Court of Montgomery County, unless waived by the commissioner upon a showing by the insurer of good cause for its failure to file its report on or before the date due.

(d) At time of filing, the insurer shall pay the fee for filing its annual statement as prescribed by Section 27-4-2.

(e) In addition to information called for and furnished in connection with its annual statement, an insurer shall furnish promptly to the commissioner such information with respect to any of its transactions or affairs as the commissioner may, from time to time, request in writing.

(a) No insurer shall, in this state, directly or indirectly, accept applications for insurance, negotiate for or issue any policy or contract of insurance or assume direct liability as to a subject of insurance resident, located, or to be performed in this state unless through insurance producers duly licensed under the provisions of this title.

(b) This section shall not apply to title insurance or insurance of the rolling stock, vessels, or aircraft of any common carrier in interstate or foreign commerce or covering any liability or other risks incident to the ownership, maintenance, or operation thereof. This section shall not apply as to life or disability insurance not delivered or issued for delivery in this state and lawfully solicited outside this state.

Repealed by Act 2001-702, p. 1509, § 16, effective January 1, 2002.

(a) The purpose of this section is to aid in the protection of insurers formed under the laws of Alabama and transacting insurance in other states or countries against discriminatory or onerous requirements under the laws of such states or countries or the administration thereof.

(b) When by or pursuant to the laws of any other state or foreign country, any taxes, licenses and other fees, in the aggregate, and any fines, penalties, deposit requirements or other material obligations, prohibitions or restrictions are, or would be, imposed upon Alabama insurers, or upon the agents or representatives of such insurers, which are in excess of such taxes, licenses and other fees, in the aggregate, or which are in excess of the fines, penalties, deposit requirements or other obligations, prohibitions or restrictions directly imposed upon similar insurers, or upon the agents or representatives of such insurers, of such other state or country under the statutes of this state, so long as such laws of such other state or country continue in force or are so applied, the same taxes, licenses and other fees, in the aggregate, or fines, penalties or deposit requirements or other material obligations, prohibitions or restrictions, of whatever kind, shall be imposed by the commissioner upon the insurers, or upon the agents or representatives of such insurers, of such other state or country doing business or seeking to do business in Alabama. Any tax, license or other fee or other obligation imposed by any city, county or other political subdivision or agency of such other state or country on Alabama insurers, or their agents or representatives, shall be deemed to be imposed by such state or country within the meaning of this section.

(c) This section shall not apply as to personal income taxes, nor as to ad valorem taxes on real or personal property nor as to special purpose obligations or assessments imposed by another state in connection with particular kinds of insurance, other than property insurance; except, that deductions from premium taxes or other taxes otherwise payable allowed on account of real estate or personal property taxes paid shall be taken into consideration by the commissioner in determining the propriety and extent of retaliatory action under this section.

(d) For the purposes of this section, the domicile of an alien insurer, other than insurers formed under the laws of Canada or a province thereof, shall be that state designated by the insurer in writing filed with the commissioner at time of admission to this state or within six months after the effective date of this title, whichever date is the later, and may be any one of the following states:

(1) That in which the insurer was first authorized to transact insurance;

(2) That in which is located the insurer's principal place of business in the United States; or

(3) That in which is held the larger deposit of trusteed assets of the insurer for the protection of its policyholders or policyholders and creditors in the United States.

If the insurer makes no such designation its domicile shall be deemed to be that state in which is located its principal place of business in the United States.

(e) In the case of an insurer formed under the laws of Canada or a province thereof, its domicile shall be deemed to be that province in which is located its head office.

A foreign insurer may transact business in this state without certificate of authority for the purpose, and to the extent only, of investing its funds in real estate located in this state, or in securities secured thereby, by complying with the requirements of Amendment 154 of the Constitution of Alabama. Such an insurer shall not be subject to any other provisions of this title.

Any insurer which is organized under the laws of any other state and is admitted to do business in this state for the purpose of writing insurance may become a domestic insurer by complying with all of the requirements of law relative to the organization and licensing of a domestic insurer of the same type and by designating its principal place of business at a place in this state. Said domestic insurer will be entitled to like certificates and licenses to transact business in this state and shall be subject to the authority and jurisdiction of this state. Articles of incorporation of such domestic insurer may be amended to provide that the corporation is a continuation of the corporate existence of the original foreign corporation through adoption of this state as its corporate domicile and that the original date of incorporation in its original domiciliary state is the date of incorporation of such domestic insurer.

Any domestic insurer may, upon the approval of the Commissioner of Insurance, transfer its domicile to any other state in which it is admitted to transact the business of insurance, and upon such a transfer shall cease to be a domestic insurer, and shall be admitted to this state if qualified as a foreign insurer. The Commissioner of Insurance shall approve any such proposed transfer unless he shall determine such transfer is not in the interest of the policyholders of this state.

The certificate of authority, agents appointments and licenses, rates, and other items which the Commissioner of Insurance allows, in his discretion, which are in existence at the time any insurer licensed to transact the business of insurance in this state transfers its corporate domicile to this or any other state by merger, consolidation or any other lawful method shall continue in full force and effect upon such transfer if such insurer remains duly qualified to transact the business of insurance in this state. All outstanding policies of any transferring insurer shall remain in full force and effect and need not be endorsed as to the new name of the company or its new location unless so ordered by the Commissioner of Insurance. Every transferring insurer shall file new policy forms with the Commissioner of Insurance on or before the effective date of the transfer, but may use existing policy forms with appropriate endorsements if allowed by and under such conditions as approved by the Commissioner of Insurance. However, every such transferring insurer shall notify the Commissioner of Insurance of the details of the proposed transfer, and shall file promptly any resulting amendments to corporate documents filed or required to be filed in accordance with Sections 10-2A-90 through 10-2A-284, 27-3-17, 27-27-5 and 27-27-22.

The Commissioner of Insurance of this state may promulgate necessary rules and regulations to carry out the purposes of Sections 27-3-30 through 27-3-32.

To qualify for and hold authority to transact insurance in this state, an insurer must be otherwise in compliance with this title and with its charter powers and must be an incorporated stock insurer or an incorporated mutual insurer or a reciprocal insurer, all of the same general type as may be formed as a domestic insurer under this title; except that:

(1) No foreign insurer shall be authorized to transact insurance in this state which does not maintain reserves as required by Chapter 36 of this title applicable to the kind, or kinds, of insurance transacted by such insurer, wherever transacted in the United States, or which transacts insurance in the United States on the assessment premium plan, stipulated premium plan, cooperative plan or any similar plan;

(2) Any foreign insurer which has transacted insurance as an authorized insurer in its state or country of domicile for less than five years shall not be authorized to transact insurance in this state unless it is otherwise qualified for such authority under this code and is:

a. The wholly owned subsidiary of an insurer authorized to transact insurance in this state;

b. The continuing corporation resulting from a merger or consolidation of insurers at least one of which insurers has been an authorized insurer in its state or country of domicile for at least five years; or

c. Is in compliance with the requirements as to capital and surplus provided therefor under Sections 27-3-7 and 27-3-8;

(3) The commissioner shall not grant or continue authority to transact insurance in this state as to any insurer the management of which is found by him, after thorough investigation, to be incompetent or untrustworthy, or so lacking in insurance company managerial experience as to make the proposed operation hazardous to the insurance-buying public or which, after thorough examination or investigation, he has good reason to believe is affiliated directly or indirectly through ownership, control, reinsurance transactions or other insurance or business relations with any person, or persons, whose business operations are, or have been, marked to the injury of insurers, stockholders, policyholders, creditors or the public by manipulation of assets, of accounts or of reinsurance or by bad faith;

(4) No insurer the voting control of which is held, in whole or substantial part, by any government or governmental agency shall be authorized to transact insurance in this state. Membership in a mutual insurer or subscribership in a reciprocal insurer shall not be deemed to be either an ownership or control of the insurer for the purposes of this subdivision; and

(5) Lloyd's plan insurers may be authorized to transact insurance in this state as provided in Section 27-3-16.

(a) No insurer shall be authorized to transact insurance which has or uses a name so similar to that of another insurer already so authorized as likely to mislead the public.

(b) No life insurer shall be so authorized which has or uses a name deceptively similar to that of another insurer authorized to transact insurance in this state within the preceding 10 years if life insurance policies originally issued by such other insurer are still outstanding in this state.

(c) No insurer shall be so authorized which has or uses a name which tends to deceive or mislead as to the type of organization of the insurer.

(d) In case of conflict of names hereafter between two insurers, or a conflict otherwise prohibited under the foregoing subsections of this section, the commissioner may permit or require, as a condition to the issuance of an original certificate of authority to an applicant insurer, that such insurer shall use in Alabama such supplementation or modification of its name or such business name as may reasonably be necessary to avoid such conflict. No such name, supplementation or modification shall contain the principal identifying factor contained in the name of any other insurer already authorized to transact insurance in this state.

An insurer which otherwise qualifies therefor may be authorized to transact any one kind or combination of kinds of insurance as defined in Chapter 5 of this title, except:

(1) A life insurer may grant annuities and shall be authorized to transact in addition only disability insurance, and no insurer shall be authorized to transact life insurance in this state which transacts anywhere any kind of insurance in addition to life and disability insurances and annuities; except, that the commissioner shall, if the insurer otherwise qualifies therefor, continue to so authorize any life insurer which, immediately prior to the effective date of this title, was lawfully authorized to transact in this state a kind or kinds of insurance in addition to life and disability;

(2) A reciprocal or Lloyd's plan insurer shall not transact life insurance; and

(3) A title insurer shall be a stock insurer and shall transact no other kind of insurance; except, that the commissioner may continue to so authorize any insurer which immediately prior to the effective date of this title was lawfully authorized to transact and was lawfully writing in this state a kind, or kinds, of insurance in addition to title insurance.

(a) To qualify for authority to transact any one kind of insurance, as defined in Chapter 5 of this title, or combination of kinds of insurance as shown below, an insurer applying for its original certificate of authority in this state after the effective date of this title or continuing such original certificate of authority shall possess and thereafter maintain unimpaired paid-in capital stock, if a stock insurer, or unimpaired surplus, if a foreign mutual or foreign reciprocal insurer, in amount not less than as applicable under the schedule below and shall possess when first so authorized such additional funds as surplus as are required under Section 27-3-8:

(b) An insurer holding a valid certificate of authority to transact insurance in this state immediately prior to the effective date of this title may continue to be authorized to transact the same kinds of insurance as permitted by such certificate of authority by maintaining thereafter not less than the same amount of paid-in capital stock, if a stock insurer, or not less than the same amount of surplus, if a mutual or reciprocal insurer, as required by the laws of this state for such authority immediately prior to such effective date; but such insurer shall not thereafter be granted authority to transact any other or additional kind of insurance unless it then fully complies with the requirements as to capital and surplus, as applied to all kinds of insurance it then proposes to transact, as provided by this title with respect to insurers applying for original certificates of authority under this title.

(c) Capital and surplus requirements shall be based upon all the kinds of insurance actually transacted, or to be transacted, by the insurer in any and all areas in which it operates, whether or not only a portion of such kinds are to be transacted in this state.

(d) As to surplus required for qualification to transact one or more kinds of insurance and thereafter to be maintained, domestic mutual insurers shall be governed by Chapter 27 of this title, and domestic reciprocal insurers shall be governed by Chapter 31 of this title.

(e) A life insurer may also grant annuities without additional capital or additional surplus.

(f) A casualty insurer may be authorized to transact also disability insurance without additional capital or additional surplus.

(a) In addition to the minimum paid-in capital stock (stock insurers) or minimum surplus (mutual and reciprocal insurers) required by Section 27-3-7, special surplus shall be possessed by insurers hereafter applying for original certificates of authority in this state as follows:

(1) All stock insurers and foreign mutual and foreign reciprocal insurers which have actively transacted insurance in their states or countries of domicile as an authorized insurer for less than five years and which do not meet the requirements of paragraphs (2) a or (2) b of Section 27-3-4, when first authorized to transact insurance in this state shall have a surplus or additional surplus equal to 150 percent of the paid-up capital stock, if a stock insurer, or surplus, if a foreign mutual or foreign reciprocal insurer, otherwise required under Section 27-3-7 for the kinds of insurance to be transacted; and

(2) An insurer that has actively transacted insurance as an authorized insurer in its state or country of domicile for more than five years, or which meets the requirements of paragraphs (2) a or (2) b of Section 27-3-4, shall possess when first authorized in this state surplus, if a stock insurer, or additional surplus, if a mutual or reciprocal insurer, equal to 100 percent of the paid-in capital stock, if a stock insurer, or surplus, if a foreign mutual or foreign reciprocal insurer, otherwise required under Section 27-3-7.

(b) If within five years after date of its original certificate of authority to transact insurance in this state such an insurer requests authority to transact an additional kind or kinds of insurance, it shall not be so authorized unless it then possesses surplus, if a stock insurer, or additional surplus, if a mutual or reciprocal insurer, in such an amount as would be required under this section as for an original certificate of authority covering all the kinds of insurance the insurer then proposes to transact.

(c) After issuance of its original certificate of authority the insurer may use the special surplus required under this section in the normal course of its business only.

(d) Execution by a mutual or reciprocal surety insurer as sole surety of certain bonds or undertakings required or permitted by law or by certain political subdivisions, public bodies or public officers is subject further to surplus requirement as provided in Section 27-24-3.

The minimum capital required to form and organize a new domestic stock life insurance company shall be $1,000,000.00, and in addition thereto the minimum surplus to form such a company shall be $1,000,000.00.