Ala. Admin. Code r. 482-3-003-.11

Current through Register Vol. 43, No. 1, October 31, 2024

Section 482-3-003-.11 - Transfer Of Certificate Of Authority Or Branch Registration

(1) A transaction which has the effect of transferring a certificate of authority or branch registration must be authorized by the Commissioner prior to the closing of the transaction. Without limitation, authorization is required for the sale of a certificate of authority or branch registration, the sale of a certificate holder's business or assets to the extent the transaction includes transfer of the certificate of authority or branch registration, and sale of all or a controlling interest in any business entity certificate holder or branch registrant.

(2) Prior to the closing of the transaction which will give rise to a transfer, the certificate holder shall give notice of the proposed transaction in a form prescribed by the Commissioner and provide the following to the Commissioner:

(a) A copy of any fully signed letter of intent with any exhibits, attachments, or schedules referenced in the letter of intent.

(b) A copy of the fully signed purchase agreement or other form of contract which describes the terms of the transaction which will result in a transfer with any exhibits, attachments, or schedules referenced in the agreement or contract. Any such purchase agreement or contract must be conditioned upon approval of the Commissioner to the transfer and must specifically address the parties' agreements concerning performance of preneed contracts previously sold, but unperformed, by the certificate holder. If the proposed transaction will result in a change of ownership of the certificate holder, the agreement or contract must provide that preneed contract holders will be notified in writing of the change of ownership within ninety (90) days after the transfer is complete.

(c) If not otherwise addressed by the purchase agreement or contract, evidence acceptable to the Commissioner that all required amounts have been deposited in trust and that the certificate holder's interest in each trust will be conveyed to the purchaser or transferee as part of the transaction without a diminution or pay out of trust assets or gain on such assets to the transferring certificate holder or another as part of the transaction.

(d) Any other documentation requested by the Department of the seller or purchaser in order for the Commissioner to make a determination on the proposed transfer.

(3) For sale or transfer of endowment care cemeteries, all payments required to be paid to the endowment care trust fund must be paid to date. The endowment care trust must continue to hold the trust funds after the sale or transfer. No funds held by the endowment care trust may be withdrawn as a result of a sale or transfer.

Ala. Admin. Code r. 482-3-003-.11

Adopted by Alabama Administrative Monthly Volume XXXIII, Issue No. 02, November 26, 2014, eff. 1/1/2015.

Author: Commissioner of Insurance

Statutory Authority:Code of Ala. 1975, §§ 27-2-17, 27-17A-1 to -57 (2014).