The following deposits of insurers, when made through the commissioner, shall be accepted and held and shall be subject to the provisions of this chapter:

(1) Deposits required under this title for authority to transact insurance in this state;

(2) Deposits of domestic insurers when made pursuant to the laws of other states, provinces and countries as requirement for authority to transact insurance in such state, province or country;

(3) Deposits of reserves made by domestic life insurers under laws heretofore in force; and

(4) Deposits in such additional amounts as are permitted to be made under Section 27-6-11.

If less than all of the securities or assets covered by any such power of attorney is returned to the insurer or its trustee or agent, the commissioner may require the insurer to deliver to him, as a condition precedent to the return of such power of attorney, a new power of attorney covering the securities and assets not then being withdrawn. The new power of attorney shall be held and exercised under the same restrictions and upon the same conditions as prescribed in this chapter for the original power of attorney.

An insurer may so deposit assets or securities in an amount exceeding its deposit required or otherwise permitted under this title by not more than 20 percent of such required or permitted deposit or $100,000.00, whichever is the larger amount, for the purpose of absorbing fluctuations in the value of securities and assets deposited and to facilitate the exchange and substitution of such securities and assets. During the solvency of the insurer, any such excess shall be released to the insurer upon its request. During the insolvency of the insurer, such excess deposit shall be released only as provided in subdivision (b) (3) of Section 27-6-15.

So long as the insurer remains solvent and is in compliance with this title, it may:

(1) Demand, receive, maintain actions for and recover the income from the securities or assets deposited;

(2) Exchange and substitute for the deposited securities or assets, or any part thereof, other eligible securities and assets of equivalent or greater value; and

(3) At any reasonable time, inspect any such deposit.

(a) If any surety insurer which has made the deposit provided for in Section 27-3-12 fails or refuses to pay any final judgment entered against it upon any bond or undertaking from which no appeal and supersedeas has been taken for 30 days after the entry of such judgment, the clerk or register of the court in which such judgment was entered shall certify a copy thereof to the commissioner, together with the fact that it remains unpaid, and the commissioner shall sell as many of the securities or other assets deposited by such insurer as may be necessary to pay such judgment, and the interest and costs thereon, and to pay to the clerk or register of the court, from the proceeds of the sale, the amount of the judgment, with interest and costs. The commissioner shall sell such securities or other assets at private or public sale, with or without notice, or so many as may be necessary for the best price he can obtain in the market, shall assign the same to the purchaser and shall apply the proceeds, or so much thereof as may be necessary, to the payment of such judgment, with interest and costs, the surplus, if any, remaining on deposit in lieu of the securities or other assets so sold.

(b) Of such sale, the commissioner must forthwith notify the insurer and require it to supply the deficiency, if any, in the deposit within 30 days as required in Section 27-6-14; and, if the insurer fails to do so, the commissioner shall revoke its certificate of authority.

(a) If for any reason the market value of assets and securities of an insurer held on deposit in this state under this title falls below the amount so required, the insurer shall promptly deposit other or additional assets or securities eligible for deposit sufficient to cure such deficiency. If the insurer has failed to cure the deficiency within 30 days after receipt of notice thereof by registered or certified mail from the commissioner, the commissioner shall revoke the insurer's certificate of authority.

(b) If for any reason the market value of assets and securities of a domestic life insurer, representing deposit of the reserves of certain of its outstanding registered policies and registered annuity contracts under laws heretofore in force, falls below the amount so required and as determined from the insurer's most recent annual statement or most recent examination of the insurer by the commissioner, the insurer shall promptly deposit other or additional assets or securities eligible for deposit sufficient to cure such deficiency. If the insurer has failed to cure the deficiency, after the commissioner has given the insurer notice thereof by registered or certified mail, within such reasonable time not exceeding 90 days as may be allowed therefor by the commissioner and so specified in his notice, the insurer shall be deemed to be insolvent and the commissioner shall revoke its certificate of authority and institute delinquency proceedings against the insurer under Chapter 31 of this title.

(a) All deposits in this state made under this title shall be held on deposit as long as there is outstanding any liability of the insurer with respect to which the deposit was made.

(b) Any such deposit shall be released and returned:

(1) To the insurer upon extinguishment by reinsurance in an insurer authorized to transact such insurance in this state, or otherwise, of all liability of the insurer for the security of which the deposit is held;

(2) To the insurer during solvency, to the extent such deposit is in excess of the amount required; or

(3) Upon proper order of a court of competent jurisdiction, to the receiver, conservator, rehabilitator or liquidator of the insurer or to any other properly designated official, or officials, who succeed to the management and control of the insurer's assets.

(c) The treasurer shall release any such deposit, or part thereof, upon written authorization of the commissioner and of the insurer or order of court, as provided in subsection (d) of Section 27-6-4.

(d) In the case of deposits of title insurers made under Section 27-3-13, the deposit or excess portion thereof shall be released by the trustee bank or trust company upon written authorization of the commissioner or upon order of a court of competent jurisdiction. If a foreign title insurer which has made such a deposit reincorporates under the laws of the State of Alabama and qualifies under this code as a domestic title insurer and if all of the liabilities of such foreign insurer in this state are assumed by such new domestic insurer and the foreign insurer does not thereafter transact business in this state, its deposit shall be delivered by such trustee to such new domestic insurer upon its application and the written authorization of the commissioner.

(e) This section shall not apply as to deposits held with respect to registered life insurance policies or registered annuity contracts insured under laws heretofore in force. Such deposits shall be released only as provided under the laws pursuant to which such policies and contracts were so issued and registered.

(a) Before authorizing the release of any deposit or excess portion thereof to the insurer, as provided in Section 27-6-15, the commissioner shall require the insurer to file with him a statement under its seal and the oath of its chief executive officer, or of its United States manager in the case of an alien insurer, setting forth the facts upon which it bases its entitlement to such release.

(b) If release of the deposit is claimed by the insurer upon the ground that its liabilities in this state, as to which the deposit was originally made and is held, have been assumed by another insurer authorized to transact insurance in this state, the insurer shall file with the commissioner a copy of the contract or agreement of such reinsurance.

(c) Upon being satisfied by such statement and such other information and evidence as he may reasonably require and by such examination, if any, of the affairs of the insurer as he deems advisable to make that the insurer is entitled to the release of its deposits or excess portions thereof as provided in Section 27-6-15, the commissioner shall authorize the treasurer or the trustee bank or trust company in the case of deposits of title insurers made under Section 27-3-13 to release the deposit or excess portion thereof to the insurer or its authorized representative. The commissioner shall have no liability as to any such release so made by him in good faith.

Such deposits shall be held for purposes as follows:

(1) Deposits made in this state under Sections 27-3-11, 27-3-12 and 27-3-14 of this title shall be held for the purposes stated in the respective sections;

(2) A deposit made in this state by a domestic insurer transacting insurance in another state, province or country and as required by the laws of such state, province or country shall be held for the protection of the insurer's policyholders or policyholders and creditors;

(3) Deposits of reserves made by domestic life insurers under laws heretofore in force shall be held for the purpose or purposes specified in such laws or in the policies or contracts by which such deposit was required or declared; and

(4) Deposits required pursuant to the retaliatory provision, Section 27-3-29, shall be held for such purposes as are required by such laws and as specified by the commissioner's order by which the deposit is required.

(a) All such deposits required under Sections 27-3-11, 27-3-12 and 27-3-14 for authority to transact insurance in this state shall consist of certified checks, or certificates of deposit or any combination of securities, the market value of which is readily ascertainable, and, if negotiable by delivery or assignment, of the kinds described below:

(1) United States government obligations;

(2) State, county, municipal and school obligations;

(3) Public improvement obligations;

(4) Housing authority obligations;

(5) Obligations, stock of certain federal agencies;

(6) Canadian governmental obligations;

(7) International banks;

(8) Corporate obligations;

(9) Equipment trust obligations; and

(10) Railroad leased lines, terminal obligations.

(b) All such deposits required of a domestic insurer pursuant to the laws of another state, province or country shall be comprised of securities, if negotiable by delivery or assignment, of the kind, or kinds, required or permitted by the laws of such state, province or country, except common stocks, mortgages of any kind and real estate.

(c) Deposits of the reserves of a domestic life insurer under laws heretofore in force shall consist of securities, if negotiable by delivery or assignment, eligible for investment of the insurer's reserves.

(d) Deposits of foreign insurers made in this state under the retaliatory provision, Section 27-3-29, shall consist of such securities or assets as are required by the commissioner pursuant to such provision.

(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 book-entry system. When such securities are so deposited, certificates representing securities of the same class of the same issuer 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) Deposits made in this state under Sections 27-3-11, 27-3-12 and 27-3-14, together with deposit of reserves of domestic life insurers under registered policies heretofore issued, shall be made through the commissioner with the Treasurer of the State of Alabama.

(b) The State Treasurer, in his official capacity, shall take receipt for and hold deposits made under this title as provided in subsection (a) of this section, subject to the provisions of this chapter.

(c) The State Treasurer shall hold all such deposits in safekeeping in the vaults located in his offices or, if space in such vaults is not reasonably adequate and safe for all securities and property otherwise to be contained therein, the treasurer may keep such securities in safe deposit boxes rented by him for the purpose and under his control in established safe deposit institutions located in the City of Montgomery, Alabama.

(d) The treasurer shall be the custodian only of such deposits and shall have no powers or responsibility as to the character or amount thereof. He shall accept, permit substitutions and release securities or assets so deposited only upon written authorization of the commissioner and the insurer or upon order of the court and shall have no obligation to determine in any instance whether such authorization or order, if genuine, is otherwise lawful or proper.

(e) For all securities and assets deposited as provided in this section, the faith and credit of the State of Alabama is pledged that the same will be returned to the parties entitled to receive them or disposed of as provided in this chapter.

The commissioner shall keep a record of the securities and assets comprising each deposit, showing by item the amount and market value and of all his transactions relative thereto.

(a) All securities not negotiable by delivery and deposited by an insurer shall be duly assigned to the commissioner and his successors in office. All other assets so deposited shall be duly transferred or conveyed to the commissioner. Upon release of any such security or asset to the insurer, the commissioner shall reassign, or transfer or reconvey the same to the insurer.

(b) The commissioner may, in his discretion, prior to acceptance for deposit of any security or asset or at any time thereafter while so deposited, have the same appraised or valued by competent appraisers. The reasonable costs of any such appraisal or valuation shall be borne by the insurer.

In lieu of the assignment, transfer or conveyance of securities and assets to the commissioner as provided for in subsection (a) of Section 27-6-6 and at all events in connection with any deposit heretofore or hereafter made through the commissioner, the commissioner may require or permit the depositing insurer to deliver to him a power of attorney, executed by the lawful owner of such securities or assets, authorizing the commissioner to transfer, sell or exchange the same for the purposes of the law under which the same are deposited or held on deposit. The power of attorney shall specifically describe each of the securities and assets covered thereby and shall not be a general power of attorney covering all securities and assets on deposit or thereafter deposited.

The commissioner shall exercise the power granted by the power of attorney provided for in Section 27-6-7 or otherwise sell any security or asset under any assignment, transfer or conveyance pursuant to Section 27-6-6, only pursuant to, and in accordance with, an order of a court of competent jurisdiction in a proper proceeding or action to which the insurer owning such securities or assets is a party. This section shall not apply as to the special deposits of surety insurers which are subject to Section 27-6-13.

The power of attorney provided for in Section 27-6-7 shall be kept by the commissioner in a place of safekeeping and may be physically attached to the securities or assets described therein. Whenever such securities or assets, or any portion thereof, are returned to the insurer which deposited them, the power of attorney shall be returned to the insurer or to the trustee or other representative authorized for that purpose.