HB94

ENROLLED, An Act,

Relating to insurance; to amend Sections 27-2B-9, 27-29-1, 27-29-4, and 27-29-7 of the Code of Alabama 1975, and to add Section 27-29-6.2 to the Code of Alabama 1975, to provide that the commissioner or any person receiving documents, materials, or other information under the Alabama Risk-Based Capital for Insurers Act under the authority of the commissioner shall not be permitted or required to testify in a private civil action concerning the confidential documents, materials, or information received except to authorize the documents, material, or other information to be shared with other state, federal, and international regulatory agencies, with the NAIC, and state, federal, and international law enforcement authorities; to provide that any documents, materials, or other information received from the NAIC, from regulatory or law enforcement officials of foreign or domestic jurisdictions shall be maintained as confidential or privileged as provided under the laws of the source jurisdiction; to provide that the commissioner may enter into information sharing agreements consistent with the law; to provide that sharing the documents, materials, or information shall not result in a waiver of any applicable privilege or claim of confidentiality in the documents, materials, or information; to provide that there be no exception to the requirement for the ultimate controlling person of every insurer subject to registration under the Alabama Insurance Holding Company Regulatory Act to file an annual enterprise risk report; to provide specific authority for the commissioner to share otherwise confidential and privileged documents, materials, or information under the Alabama Insurance Holding Company Regulatory Act with the National Association of Insurance Commissioners and its affiliates and subsidiaries under certain circumstances; and to clarify legal authority and power for the commissioner to act as a group-wide supervisor for internationally active insurance groups or to acknowledge another regulatory person for that purpose.

BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:Section 1. Sections 27-2B-9, 27-29-1, 27-29-4, and 27-29-7 of the Code of Alabama 1975, are amended to read as follows:

§27-2B-9.

"(a) All RBC reports, to the extent the information therein is not required to be set forth in a publicly available annual statement schedule, and RBC plans, including the results or report of any examination or analysis of an insurer performed pursuant hereto and any corrective order issued by the commissioner pursuant to examination or analysis, with respect to any domestic insurer or foreign insurer which are filed with the commissioner constitute information that may be damaging to the insurer if made available to its competitors and therefore shall be kept confidential by the commissioner. This information shall not be made public or be subject to subpoena, other than by the commissioner, and then only for the purpose of enforcement actions taken by the commissioner pursuant to this chapter or any other provision of the insurance laws of this state.

"(b) Neither the commissioner nor any person who received documents, materials, or other information while acting under the authority of the commissioner shall be permitted or required to testify in any private civil action concerning any confidential documents, materials, or information subject to subsection (a).

"(c) In order to assist in the performance of the commissioner's duties, the commissioner may do all of the following:

"(1) Share documents, materials, or other information, including the confidential and privileged documents, materials, or information subject to subsection (a), with other state, federal, and international regulatory agencies, with the National Association of Insurance Commissioners (NAIC) and its affiliates and subsidiaries, and with state, federal, and international law enforcement authorities, provided that the recipient agrees to maintain the confidentiality and privileged status of the document, material, or other information.

"(2) Receive documents, materials, or information, including otherwise confidential and privileged documents, materials, or information, from the NAIC and its affiliates and subsidiaries, and from regulatory and law enforcement officials of other foreign or domestic jurisdictions, and maintain as confidential or privileged any documents, materials, or information received with notice or the understanding that it is confidential or privileged under the laws of the jurisdiction that is the source of the document, material, or information.

"(3) Enter into agreements governing sharing and use of information consistent with this subsection.

"(d) No waiver of any applicable privilege or claim of confidentiality in the documents, materials, or information shall occur as a result of disclosure to the commissioner under this section or as a result of sharing as authorized in subsection (c).

"(b)(e) It is the judgment of the Legislature that the comparison of an insurer's total adjusted capital to any of its RBC levels is a regulatory tool which may indicate the need for possible corrective action with respect to the insurer, and is not intended as a means to rank insurers generally. Therefore, except as otherwise required under the provisions of this chapter, the making, publishing, disseminating, circulating, or placing before the public, or causing, directly or indirectly to be made, published, disseminated, circulated, or placed before the public, in a newspaper, magazine, or other publication, or in the form of a notice, circular, pamphlet, letter, or poster, or over any radio or television station, or in any other way, an advertisement, announcement, or statement containing an assertion, representation, or statement with regard to the RBC levels of any insurer, or of any component derived in the calculation, by any insurer, agent, broker, or other person engaged in any manner in the insurance business, would be misleading and is therefore prohibited. Except, if any materially false statement with respect to the comparison regarding an insurer's total adjusted capital to its RBC levels, or any of them, or an inappropriate comparison of any other amount to the insurer's RBC levels is published in any written publication, and the insurer is able to demonstrate to the commissioner with substantial proof the falsity of the statement, or the inappropriateness, as the case may be, then the insurer may publish an announcement in a written publication if the sole purpose of the announcement is to rebut the materially false statement.

"(c)(f) It is the further judgment of the Legislature that the RBC instructions, RBC reports, adjusted RBC reports, RBC plans, and revised RBC plans are intended solely for use by the commissioner in monitoring the solvency of insurers and the need for possible corrective action with respect to insurers and shall not be used by the commissioner for ratemaking nor considered or introduced as evidence in any rate proceeding nor used by the commissioner to calculate or derive any elements of an appropriate premium level or rate of return for any line of insurance which an insurer or any affiliate is authorized to write.

§27-29-1.

"For purposes of this chapter, unless otherwise stated, the following terms shall have the meanings respectively ascribed to them by this section:

"(1) AFFILIATE. The term shall include an "affiliate" of, or person "affiliated" with, a specific person, and shall mean a person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the person specified.

"(2) COMMISSIONER. The Commissioner of Insurance, his or her deputies, or the Insurance Department as appropriate.

"(3) CONTROL. The term shall include "controlling," "controlled by," or "under common control with" and shall mean the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting securities, by contract other than a commercial contract for goods or nonmanagement services, or otherwise, unless the power is the result of an official position with or corporate office held by the person. Control shall be presumed to exist if any person, directly or indirectly owns, controls, holds with the power to vote, or holds proxies representing five percent or more of the voting securities of any other person. This presumption may be rebutted by a showing made in the manner provided by subsection (k) of Section 27-29-4 that control does not exist in fact. The commissioner may determine, after furnishing all persons in interest notice and opportunity to be heard and making a specific finding of fact to support such determination, that control exists in fact, notwithstanding the absence of a presumption to that effect.

"(4) ENTERPRISE RISK. Any activity, circumstance, event, or series of events involving one or more affiliates of an insurer that, if not remedied promptly, is likely to have a material adverse effect upon the financial condition or liquidity of the insurer or its insurance holding company system as a whole, including, but not limited to, anything that would cause the insurer's risk-based capital to fall into company action level as set forth in Section 27-2B-4 or would cause the insurer to be in hazardous financial condition.

"(5) GROUP-WIDE SUPERVISOR. The regulatory official authorized to engage in conducting and coordinating group-wide supervision activities who is determined or acknowledged by the commissioner under this chapter to have sufficient significant contacts with the internationally active insurance group.

"(5)(6) INSURANCE HOLDING COMPANY SYSTEM. A system which consists of two or more affiliated persons, one or more of which is an insurer.

"(6)(7) INSURER. An insurance company as set forth in Section 27-1-2, including, without limitation, any fraternal benefit society, health care service plan, and health maintenance organization, except that it shall not include agencies, authorities, or instrumentalities of the United States, its possessions and territories, the Commonwealth of Puerto Rico, the District of Columbia, or a state or political subdivision of a state.

"(7)(8) PERSON. An individual, a corporation, a limited liability company, a partnership, an association, a joint-stock company, a trust, an unincorporated organization, or any similar entity or any combination of the foregoing acting in concert, but shall not include any joint venture partnership exclusively engaged in owning, managing, leasing, or developing real or tangible personal property.

"(8)(9) SECURITYHOLDER. One who owns any security of such person, including common stock, preferred stock, debt obligations, and other security convertible into, or evidencing, the right to acquire any of the foregoing.

"(9)(10) SUBSIDIARY. An affiliate controlled by such person, directly or indirectly, through one or more intermediaries.

"(10)(11) VOTING SECURITY. The term shall include any security convertible into, or evidencing, a right to acquire a voting security.

§27-29-4.

"(a)(1) Every insurer which is authorized to do business in this state and which is a member of an insurance holding company system shall register with the commissioner, except a foreign insurer subject to registration requirements and standards adopted by statute or regulation in the jurisdiction of its domicile which are substantially similar to those contained in this section and both of the following:

"a. Subdivision (1) of subsection (a) of Section 27-29-5, and subsections (b) and (d) of Section 27-29-5.

"b. Either subdivision (2) of subsection (a) of Section 27-29-5 or a provision such as the following: Each registered insurer shall keep current the information required to be disclosed in its registration statement by reporting all material changes or additions within 15 days after the end of the month in which it learns of each change or addition.

"(2) Any insurer which is subject to registration under this section shall register within 15 days after it becomes subject to registration, and annually thereafter by June 1 of each year for the previous calendar year, unless the commissioner for good cause shown extends the time for registration and, then, within such extended time. The commissioner may require any authorized insurer which is a member of an insurance holding company system which is not subject to registration under this section to furnish a copy of the registration statement, the summary specified in subsection (c) or other information filed by such insurance company with the insurance regulatory authority of domiciliary jurisdiction.

"(b) Every insurer subject to registration shall file a registration statement on a form prescribed by the commissioner by rule which shall contain the following current information:

"(1) The capital structure, general financial condition, ownership, and management of the insurer and any person controlling the insurer.

"(2) The identity of every member of the insurance holding company system.

"(3) The following agreements in force, and transactions currently outstanding or which have occurred during the last calendar year between such insurer and its affiliates:

"a. Loans, other investments or purchases, sales or exchanges of securities of the affiliates by the insurer or of the insurer by its affiliates.

"b. Purchases, sales, or exchanges of assets.

"c. Transactions not in the ordinary course of business.

"d. Guarantees or undertakings for the benefit of an affiliate which result in an actual contingent exposure of the insurer's assets to liability, other than insurance contracts entered into in the ordinary course of the insurer's business.

"e. All management agreements and service contracts and all cost-sharing arrangements.

"f. Reinsurance agreements.

"g. Dividends and other distributions to shareholders.

"h. Consolidated tax allocation agreements.

"(4) Any pledge of the insurer's stock, including stock of any subsidiary or controlling affiliate, for a loan made to any member of the insurance holding company system.

"(5) If requested by the commissioner, financial statements of or within an insurance holding company system, including all affiliates. Financial statements may include, but are not limited to, annual audited financial statements filed with the U.S. Securities and Exchange Commission pursuant to the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended. An insurer required to file financial statements pursuant to this subdivision may satisfy the request by providing the commissioner with the most recently filed parent corporation financial statements that have been filed with the Securities Exchange Commission. Financial statements of insurer's affiliates required to be filed with the commissioner may be filed by the insurer in the accounting standard utilized by the affiliate in its usual course of business at the time of the filing.

"(6) Other matters concerning transactions between registered insurers and any affiliates as may be included, from time to time, in any registration forms adopted or approved by the commissioner.

"(7) Statements that the insurer's board of directors or an appropriate committee of the board oversees corporate governance and internal controls and that the insurer's officers or senior management have approved, implemented, and continue to maintain and monitor corporate governance and internal control procedures.

"(8) Any other information required by the commissioner by rule.

"(c) All registration statements shall contain a summary outlining all items in the current registration statement representing changes from the prior registration statement.

"(d) No information need be disclosed on the registration statement filed pursuant to subsection (b) if such information is not material for the purposes of this section. Unless the commissioner by rule, regulation, or order provides otherwise, sales, purchases, exchanges, loans, or extensions of credit or investments involving one-half of one percent or less of an insurer's admitted assets as of December 31, next preceding, shall not be deemed material for purposes of this section.

"(e) Subject to subsection (b) of Section 27-29-5, each registered insurer shall so report all dividends and other distributions to shareholders within 15 business days following the declaration thereof.

"(f) Any person within an insurance holding company system subject to registration shall be required to provide complete and accurate information to an insurer, where the information is reasonably necessary to enable the insurer to comply with the provisions of this chapter.

"(g) The commissioner shall terminate the registration of any insurer which demonstrated that it no longer is a member of an insurance holding company system.

"(h) The commissioner may require or allow two or more affiliated insurers subject to registration under this section to file a consolidated registration statement.

"(i) The commissioner may allow an insurer which is authorized to do business in this state and which is part of an insurance holding company system to register on behalf of any affiliated insurer which is required to register under subsection (a) and to file all information and material required to be filed under this section.

"(j) The provisions of this section shall not apply to any insurer, information, or transaction if, and to the extent that, the commissioner by rule, regulation, or order shall exempt the same from the provisions of this section.

"(k) Any person may file with the commissioner a disclaimer of affiliation with any authorized insurer or a disclaimer may be filed by the insurer or any member of an insurance holding company system. The disclaimer shall fully disclose all material relationships and bases for affiliation between the person and the insurer as well as the basis for disclaiming such affiliation. A disclaimer of affiliation shall be deemed to have been granted unless the commissioner, within 30 days following receipt of a complete disclaimer, notifies the filing party the disclaimer is disallowed. In the event of disallowance, the disclaiming party may request an administrative hearing, which shall be granted. The disclaiming party shall be relieved of its duty to register under this section if approval of the disclaimer has been granted by the commissioner, or if the disclaimer is deemed to have been approved.

"(l)(1) Except as provided in subdivisions (2) and (4), the The ultimate controlling person of every insurer subject to registration shall also file an annual enterprise risk report. The report shall, to the best of the ultimate controlling person's knowledge and belief, identify the material risks within the insurance holding company system that could pose enterprise risk to the insurer. The report shall be filed with the lead state commissioner of the insurance holding company system as determined by the procedures within the Financial Analysis Handbook adopted by the National Association of Insurance Commissioners.

"(2) Except as provided in subdivision (3), the ultimate controlling person of an insurer with total direct or assumed annual premiums of less than three hundred million dollars ($300,000,000) is not required to submit an enterprise risk report under subdivision (1).

"(3) Regardless of total direct or assumed annual premium, the ultimate controlling person of an insurer that is not in compliance with applicable risk-based capital standards or that is otherwise in hazardous condition, as determined by the commissioner, shall file an enterprise risk report required by subdivision (1) as directed by the commissioner.

"(4) An insurer that in the preceding calendar year had direct written and assumed premiums of more than three hundred million dollars ($300,000,000) but less than five hundred million dollars ($500,000,000) may request an exemption from the reporting requirements of subdivision (1) by filing with the commissioner a written statement describing the undue financial or organizational hardship the insurer would suffer as a result of complying with subdivision (1). The commissioner may grant the exemption if the commissioner finds that compliance with subdivision (1) would impose an undue financial or organizational hardship on the insurer.

"(m) The failure to file a registration statement or any summary of the registration statement or enterprise risk filing required by this section within the time specified for filing shall be a violation of this section.

§27-29-7.

"(a) All documents, materials, or other information, and copies thereof, in the possession or control of the Department of Insurance that are obtained by or disclosed to the commissioner or any other person in the course of an examination or investigation made pursuant to Section 27-29-6 and all information reported pursuant to paragraphs l. and m. of subdivision (l) of subsection (b) of Section 27-29-3, Section 27-29-4, and Section 27-29-5 shall be confidential by law and privileged, shall not be subject to any open records, freedom of information, sunshine or other public record disclosure laws, and, shall not be subject to subpoena. The commissioner may use the documents, materials, and other information in the furtherance of any regulatory or legal action in the course of the commissioner's official duties. The documents, materials, and other information shall not be made public by the commissioner or any other person without the prior written consent of the insurer to which it pertains unless the commissioner determines that the interests of policyholders, shareholders, or the public will be served by the publication thereof, in which event the commissioner may publish all, or any part thereof, in such manner as the commissioner may deem appropriate. Prior to making this determination, the commissioner shall give the insurer and its affiliates who would be affected thereby no less than 10 days' written notice of the opportunity to request a hearing on the matter.

"(b) Neither the commissioner nor any person who received documents, materials, or other information while acting under the authority of the commissioner or with whom such documents, materials, or other information are shared pursuant to this chapter shall be permitted or required to testify in any private civil action concerning any confidential documents, materials, or information subject to subsection (a).

"(c) In order to assist in the performance of the commissioner's duties, the commissioner:

"(1) May share documents, materials, or other information, including the confidential and privileged documents, materials, or information subject to subsection (a), with other state, federal, and international regulatory agencies, with the National Association of Insurance Commissioners and its affiliates and subsidiaries, and with state, federal, and international law enforcement authorities, including members of any supervisory college described in Section 27-29-6.1, provided that the recipient agrees in writing to maintain the confidentiality and privileged status of the document, material, or other information, and has verified in writing the legal authority to maintain confidentiality.

"(2) Notwithstanding subdivision (1) above, may share confidential and privileged documents, material, or information reported pursuant to subsection (l) of Section 27-29-4 only with commissioners of states having statutes or regulations substantially similar to subsection (a) and who have agreed in writing not to disclose such information.

"(3) May receive documents, materials, or information, including otherwise confidential and privileged documents, materials, or information from the National Association of Insurance Commissioners and its affiliates and subsidiaries and from regulatory and law enforcement officials of other foreign or domestic jurisdictions, and shall maintain as confidential or privileged any document, material, or information received with notice or the understanding that it is confidential or privileged under the laws of the jurisdiction that is the source of the document, material, or information.

"(4) Shall enter into written agreements with the National Association of Insurance Commissioners governing sharing and use of information provided pursuant to this chapter consistent with this subsection that shall:

"a. Specify procedures and protocols regarding the confidentiality and security of information shared with the National Association of Insurance Commissioners and its affiliates and subsidiaries pursuant to this chapter, including procedures and protocols for sharing by the National Association of Insurance Commissioners with other state, federal, or international regulators.

"b. Specify that ownership of information shared with the National Association of Insurance Commissioners and its affiliates and subsidiaries pursuant to this chapter remains with the commissioner and the use of the information by the National Association of Insurance Commissioners is subject to the direction of the commissioner.

"c. Require at least 10 days' notice to be given to an insurer whose confidential information in the possession of the National Association of Insurance Commissioners pursuant to this chapter is subject to a request or subpoena to the National Association of Insurance Commissioners for disclosure or production.

"d. Require the National Association of Insurance Commissioners and its affiliates and subsidiaries to consent to intervention by an insurer in any judicial or administrative action in which the National Association of Insurance Commissioners and its affiliates and subsidiaries may be required to disclose confidential information about the insurer shared with the National Association of Insurance Commissioners and its affiliates and subsidiaries pursuant to this chapter.

"(d) The sharing of information by the commissioner pursuant to this chapter shall not constitute a delegation of regulatory authority or rulemaking, and the commissioner is solely responsible for the administration, execution, and enforcement of this chapter.

"(e) No waiver of any applicable privilege or claim of confidentiality in the documents, materials, or information shall occur as a result of disclosure to the commissioner under this section or as a result of sharing as authorized in subsection (c).

"(f) Documents, materials, or other information in the possession or control of the National Association of Insurance Commissioners pursuant to this chapter shall be confidential by law and privileged, shall not be subject to open records, freedom of information, sunshine or other public records disclosure laws, shall not be subject to subpoena, and shall not be subject to discovery or admissible in evidence in any private civil action."

Section 2. Section 27-29-6.2 is added to the Code of Alabama 1975, to read as follows:

§27-29-6.2.

(a)(1) The commissioner may act as the group-wide supervisor for any internationally active insurance group in accordance with this section. The commissioner may otherwise acknowledge another regulatory official as the group-wide supervisor where the internationally active insurance group meets any of the following:

a. Does not have substantial insurance operations in the United States.

b. Has substantial insurance operations in the United States, but not in this state.

c. Has substantial insurance operations in the United States and this state, but the commissioner has determined pursuant to the factors set forth in subsections (b) and (f) that the other regulatory official is the appropriate group-wide supervisor.

(2) An insurance holding company system that does not otherwise qualify as an internationally active insurance group may request that the commissioner make a determination or acknowledgment as to a group-wide supervisor pursuant to this section.

(b)(1) In cooperation with other state, federal, and international regulatory agencies, the commissioner shall identify a single group-wide supervisor for an internationally active insurance group. The commissioner may determine that the commissioner is the appropriate group-wide supervisor for an internationally active insurance group that conducts substantial insurance operations concentrated in this state. The commissioner may acknowledge that a regulatory official from another jurisdiction is the appropriate group-wide supervisor for the internationally active insurance group. The commissioner shall consider all of the following factors when making a determination or acknowledgment under this subsection:

a. The place of domicile of the insurers within the internationally active insurance group that hold the largest share of the group's written premiums, assets, or liabilities.

b. The place of domicile of the top-tiered insurer or insurers in the insurance holding company system of the internationally active insurance group.

c. The location of the executive office or largest operational offices of the internationally active insurance group.

d. Whether another regulatory official is acting or is seeking to act as the group-wide supervisor under a regulatory system that the commissioner determines to be both of the following:

1. Substantially similar to the system of regulation provided under the laws of this state.

2. Otherwise sufficient in terms of providing for group-wide supervision, enterprise risk analysis, and cooperation with other regulatory officials.

e. Whether another regulatory official acting or seeking to act as the group-wide supervisor provides the commissioner with reasonably reciprocal recognition and cooperation.

(2) A commissioner identified under this section as the group-wide supervisor may determine that it is appropriate to acknowledge another supervisor to serve as the group-wide supervisor. The acknowledgment of the group-wide supervisor shall be made after consideration of the factors listed in paragraphs a. to e. of subdivision (1) and shall be made in cooperation with and subject to the acknowledgment of other regulatory officials involved with supervision of members of the internationally active insurance group and in consultation with the internationally active insurance group.

(c) Notwithstanding any other provision of law, when another regulatory official is acting as the group-wide supervisor of an internationally active insurance group, the commissioner shall acknowledge that regulatory official as the group-wide supervisor. The commission shall make a determination or acknowledgment as to the appropriate group-wide supervisor for such an internationally active insurance group pursuant to subsection (b) in the event of a material change in the internationally active insurance group that results in either of the following:

(1) The internationally active insurance group's insurers domiciled in this state holding the largest share of the group's premiums, assets, or liabilities.

(2) This state being the place of domicile of the top-tiered insurer or insurers in the insurance holding company system of the internationally active insurance group.

(d) Pursuant to Section 27-29-6, the commissioner is authorized to collect from any insurer registered pursuant to Section 27-29-4 all information necessary to determine whether the commissioner may act as the group-wide supervisor of an internationally active insurance group or if the commissioner may acknowledge another regulatory official to act as the group-wide supervisor. Prior to issuing a determination that an internationally active insurance group is subject to group-wide supervision by the commissioner, the commissioner shall notify the insurer registered pursuant to Section 27-29-4 and the ultimate controlling person within the internationally active insurance group. The internationally active insurance group shall have not less than 30 days to provide the commissioner with additional information pertinent to the pending determination. The commissioner shall publish by bulletin and on its Internet website the identity of internationally active insurance groups that the commissioner has determined are subject to group-wide supervision by the commissioner.

(e) If the commissioner is the group-wide supervisor for an internationally active insurance group, the commissioner is authorized to engage in any of the following group-wide supervision activities:

(1) Assess the enterprise risks within the internationally active insurance group to ensure both of the following:

a. The material financial condition and liquidity risks to the members of the internationally active insurance group that are engaged in the business of insurance are identified by management.

b. Reasonable and effective mitigation measures are in place.

(2) Request, from any member of an internationally active insurance group subject to the commissioner's supervision, information necessary and appropriate to assess enterprise risk, including, but not limited to, information about the members of the internationally active insurance group regarding the following:

a. Governance, risk assessment, and management.

b. Capital adequacy.

c. Material intercompany transactions.

(3) Coordinate and, through the authority of the regulatory officials of the jurisdictions where members of the internationally active insurance group are domiciled, compel development and implementation of reasonable measures designed to ensure that the internationally active insurance group is able to timely recognize and mitigate enterprise risks to members of the internationally active insurance group that are engaged in the business of insurance.

(4) Communicate with other state, federal, and international regulatory agencies for members within the internationally active insurance group and share relevant information subject to the confidentiality provisions of Section 27-29-7 through supervisory colleges as set forth in Section 27-29-6.1 or otherwise.

(5) Enter into agreements with or obtain documentation from any insurer registered under Section 27-29-4, any member of the internationally active insurance group, and any other state, federal, and international regulatory agencies for members of the internationally active insurance group, providing the basis for or otherwise clarifying the commissioner's role as group-wide supervisor, including provisions for resolving disputes with other regulatory officials. The agreements or documentation shall not serve as evidence in any proceeding that any insurer or person within an insurance holding company system not domiciled or incorporated in this state is doing business in this state or is otherwise subject to jurisdiction in this state.

(6) Other group-wide supervision activities, consistent with the authorities and purposes enumerated above, as considered necessary by the commissioner.

(f) If the commissioner acknowledges that another regulatory official from a jurisdiction that is not accredited by the National Association of Insurance Commissioners is the group-wide supervisor, the commissioner is authorized to reasonably cooperate, through supervisory colleges or otherwise, with group-wide supervision undertaken by the group-wide supervisor, provided that:

(1) The commissioner's cooperation is in compliance with the laws of this state.

(2) The regulatory official acknowledged as the group-wide supervisor also recognizes and cooperates with the commissioner's activities as a group-wide supervisor for other internationally active insurance groups where applicable. Where such recognition and cooperation is not reasonably reciprocal, the commissioner may refuse recognition and cooperation.

(g) The commissioner may enter into agreements with or obtain documentation from any insurer registered under Section 27-29-4, any affiliate of the insurer, and other state, federal, and regulatory agencies for members of the internationally active insurance group, that provide the basis for or otherwise clarify a regulatory official's role as group-wide supervisor.

(h) The commissioner may adopt rules necessary for the administration of this section.

(i) A registered insurer subject to this section shall be liable for and shall pay the reasonable expenses of the commissioner's participation in the administration of this section, including the engagement of attorneys, actuaries, and any other professionals and all reasonable travel expenses.

Section 3. The amendment to Section 27-29-4, Code of Alabama 1975, by this act shall become effective January 1, 2019, and the remainder of this act shall become effective immediately upon its passage and approval by the Governor or its otherwise becoming law.

Insurance

Insurance Department

Civil Procedure

Code Added

Code Amended