Section 27-42-1 – Short Title.
Section 27-42-1 Short title. This chapter shall be known and may be cited as the “Alabama Insurance Guaranty Association Act.” (Acts 1980, No. 80-806, p. 1639, §1.)
Section 27-42-10 – Duties and Powers of the Commissioner; Judicial Review.
Section 27-42-10 Duties and powers of the commissioner; judicial review. (a) The commissioner shall: (1) Notify the association of the existence of an insolvent insurer not later than three days after he receives notice of determination of the insolvency. The association shall be entitled to a copy of any complaint seeking an order of liquidation […]
Section 27-42-11 – Settlement and Payment of Claims; Recovery.
Section 27-42-11 Settlement and payment of claims; recovery. (a) Any person recovering under this chapter shall be deemed to have assigned his or her rights under the policy to the association to the extent of his or her recovery from the association. Every insured or claimant seeking the protection of this chapter shall cooperate with […]
Section 27-42-12 – Exhaustion of Rights; Nonduplication of Recovery.
Section 27-42-12 Exhaustion of rights; nonduplication of recovery. (a) Any person having a claim under an insurance policy, whether or not it is a policy issued by a member insurer, where the claim under the other policy arises from the same facts, injury, or loss that gave rise to the covered claim against the association, […]
Section 27-42-13 – Prevention of Insolvencies; Examinations of Insurers; Reports.
Section 27-42-13 Prevention of insolvencies; examinations of insurers; reports. (a) To aid in the detection and prevention of insurer insolvencies, it shall be the duty of the board of directors, upon majority vote, to notify the commissioner of any information indicating any member insurer may be insolvent or in a financial condition hazardous to the […]
Section 27-42-14 – Examination of the Association; Financial Report.
Section 27-42-14 Examination of the association; financial report. The association shall be subject to examination and regulation by the commissioner. The board of directors shall submit, not later than March 30 of each year, a financial report for the preceding calendar year in a form approved by the commissioner. (Acts 1980, No. 80-806, p. 1639, […]
Section 27-42-15 – Tax Exemption.
Section 27-42-15 Tax exemption. The association shall be exempt from payment of all fees and all taxes levied by this state or any of its subdivisions except taxes levied on real or personal property. (Acts 1980, No. 80-806, p. 1639, §15.)
Section 27-42-16 – Credits for Assessments Paid; Disposition of Refunds Previously Offset.
Section 27-42-16 Credits for assessments paid; disposition of refunds previously offset. (a) A member insurer may offset against its premium tax liability to this state an assessment described in subdivision (3) of subsection (a) of Section 27-42-8 to the extent of 20 percent of the amount of such assessment for each of the five calendar […]
Section 27-42-17 – Immunity.
Section 27-42-17 Immunity. There shall be no liability on the part of and no cause of action of any nature shall arise against any member insurer, the association or its agents or employees, the board of directors or the commissioner or his representatives for any action taken by them in the performance of their powers […]
Section 27-42-18 – Stay of Proceedings; Access of Board to Records of Insurers.
Section 27-42-18 Stay of proceedings; access of board to records of insurers. All proceedings in which the insolvent insurer is a party or is obligated to defend a party in any court in this state shall be stayed for up to six months and such additional time thereafter as may be determined by the court […]
Section 27-42-19 – Association, Policyholders, Beneficiaries, and Insureds to Have Preferred Creditor Status.
Section 27-42-19 Association, policyholders, beneficiaries, and insureds to have preferred creditor status. Upon the issuance of a proper court order placing a domestic insurer in receivership or placing a foreign insurer in ancillary receivership for rehabilitation or liquidation, all policyholders, beneficiaries, and insureds of such insolvent insurer, with respect to claims arising from and within […]
Section 27-42-2 – Purpose of Chapter.
Section 27-42-2 Purpose of chapter. The purpose of this chapter is to provide a mechanism for the payment of covered claims under certain insurance policies, to avoid excessive delay in payments and to avoid financial loss to claimants or policyholders because of the insolvency of an insurer, to assist in the detection and prevention of […]
Section 27-42-20 – Access to Assets of Insolvent Insurer; Application for Court Approval of Plan to Disburse Assets; Notice of Application.
Section 27-42-20 Access to assets of insolvent insurer; application for court approval of plan to disburse assets; notice of application. (a) Within 120 days of a final determination of insolvency of an insurance company by a court of competent jurisdiction the receiver shall make application to the said court for approval of a proposal to […]
Section 27-42-3 – Applicability of Chapter.
Section 27-42-3 Applicability of chapter. This chapter shall apply to all kinds of direct insurance, excluding all of the following: (1) Life, annuity, health, or disability insurance. (2) Mortgage guaranty, financial guaranty, or other forms of insurance offering protection against investment risks. (3) Fidelity or surety bonds, or any other bonding obligations. (4) Credit insurance, […]
Section 27-42-4 – Construction of Chapter.
Section 27-42-4 Construction of chapter. This chapter shall be liberally construed to effect the purpose under Section 27-42-2 which will constitute an aid and guide to interpretation. (Acts 1980, No. 80-806, p. 1639, §4.)
Section 27-42-5 – Definitions.
Section 27-42-5 Definitions. As used in this chapter, the following terms shall have the following meanings, respectively, unless the context clearly indicates otherwise: (1) ACCOUNT. Any one of the three accounts created by Section 27-42-6. (2) AFFILIATE. A person who directly, or indirectly, through one or more intermediaries, controls, is controlled by, or is under […]
Section 27-42-6 – Association Created; Member Insurers; Accounts.
Section 27-42-6 Association created; member insurers; accounts. There is created a nonprofit unincorporated legal entity to be known as the Alabama Insurance Guaranty Association. All insurers defined as member insurers in subdivision (6) of Section 27-42-5 shall be and remain members of the association as a condition of their authority to transact insurance in this […]
Section 27-42-7 – Board of Directors; Selection; Vacancies; Expenses.
Section 27-42-7 Board of directors; selection; vacancies; expenses. (a) The board of directors of the association shall consist of not less than five nor more than nine persons serving terms as established in the plan of operation. The members of the board shall be selected by member insurers subject to the approval of the commissioner. […]
Section 27-42-8 – Powers and Duties.
Section 27-42-8 Powers and duties. (a) The association shall: (1)a. Be obligated to pay covered claims existing prior to the order of liquidation arising within 30 days after the order of liquidation, or before the policy expiration date if less than 30 days after the order of liquidation, or before the insured replaces the policy […]
Section 27-42-8.1 – Maximum Assessment.
Section 27-42-8.1 Maximum assessment. (a) Notwithstanding the one percent maximum assessment set forth in subdivision (3) of subsection (a) of Section 27-42-8, no member insurer may be assessed in any one year for the workers’ compensation account an amount greater than two percent of that member insurer’s net direct written premiums for workers’ compensation insurance […]