(2) If an assuming insurer’s eligibility is revoked, no credit for reinsurance may be granted after the effective date of the revocation with respect to any reinsurance agreements entered into by the assuming insurer, including reinsurance agreements entered into prior to the date of revocation, except to the extent that the assuming insurer’s obligations under the contract are secured in a form acceptable to the commissioner and consistent with Section 27-5B-3 through 27-5B-13” class=”unlinked-ref” datatype=”S” sessionyear=”2022″ statecd=”AL”>27-5B-14.

lawyer at desk

Ask an insurance law question, get an answer ASAP!
Click here to chat with a lawyer about your rights.

Terms Used In Alabama Code 27-5B-8.1

  • Amendment: A proposal to alter the text of a pending bill or other measure by striking out some of it, by inserting new language, or both. Before an amendment becomes part of the measure, thelegislature must agree to it.
  • Contract: A legal written agreement that becomes binding when signed.
  • Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
(e) If subject to a legal process of rehabilitation, liquidation, or conservation, as applicable, the ceding insurer, or its representative, may seek and, if determined appropriate by the court in which the proceedings are pending, may obtain an order requiring that the assuming insurer post security for all outstanding ceded liabilities.
(f) Nothing in this section shall limit or in any way alter the capacity of parties to a reinsurance agreement to agree on requirements for security or other terms in that reinsurance agreement, except as expressly prohibited by this chapter or other applicable law or rule.
(g)

(1) Credit may be taken under this section only for reinsurance agreements entered into, amended, or renewed on or after the effective date of the act adding this section, and only with respect to losses incurred and reserves reported on or after the later of a. the date on which the assuming insurer has met all eligibility requirements pursuant to subsection (a), and b. the effective date of the new reinsurance agreement, amendment, or renewal.
(2) This subsection does not alter or impair a ceding insurer’s right to take credit for reinsurance, to the extent that credit is not available under this section, as long as the reinsurance qualified for credit under any other applicable provision of this chapter.
(3) Nothing in this section shall authorize an assuming insurer to withdraw or reduce the security provided under any reinsurance agreement except as permitted by the terms of the agreement.
(4) Nothing in this section shall limit or in any way alter the capacity of parties to any reinsurance agreement to renegotiate the agreement.
  Previous section
Next section  
 Chapter 5B Contents