§ 27-3-10 — Application of Capital Surplus to Reduction or Elimination of Deficit by Domestic Stock Insurers

Alabama § 27-3-10

• Jurisdiction: Alabama
• Title 27: Insurance
• Ch. 3: Authorization of Insurers

Text

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

Legislative History

(Acts 1973, No. 825, p. 1292.)