Section 27-27-12

Deposit of solicitation permit funds in escrow - Requirement.

(a) All funds received in Alabama pursuant to a solicitation permit, other than advance premiums for insurance which are subject to Section 27-27-18, shall, by the permit holder, be deposited and held in escrow in a bank or trust company located in this state under an agreement approved by the commissioner.

(b) No part of such funds shall be withdrawn from such deposit, except:

(1) For the payment of promotion, sales, and organization expenses as authorized by the solicitation permit, and funds for such purposes may be withheld from the deposit;

(2) For the purpose of making any deposit with the commissioner required for the issuance of a certificate of authority to an insurer;

(3) If the proposed organization is not to be an insurer, upon completion of payments on securities subscriptions made under the solicitation permit and deposit or appropriation of such funds to the purposes specified in the solicitation permit; or

(4) For making of refunds as provided in Section 27-27-13.

(c) When the commissioner has issued a certificate of authority to an insurer, any such funds remaining in escrow for its account shall be released to the insurer.

(d) The commissioner may waive compliance with this section as to funds required to be deposited in escrow or trust in similar institutions and for similar purposes as set forth in this section pursuant to any other law of this state.

(Acts 1971, No. 407, p. 707, §508.)