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

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Terms Used In Alabama Code 27-3-10

  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • following: means next after. See Alabama Code 1-1-1
  • state: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Alabama Code 1-1-1
(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.
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