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Bill

SB 97

Department of Insurance, surplus line brokers providing insurance not readily available by licensed agents in this state

2025 Regular Session Introduced by Wes Kitchens

Alabama authorizes surplus line brokers to sell insurance unavailable through standard licensed agents, expanding access to specialized coverage with reduced regulatory oversight.

Enacted
#insurance
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WeVote Research Nonpartisan
Bill Summary · SB 97

Legislative bill overview

SB 97 allows surplus line brokers in Alabama to provide insurance coverage for risks that are not readily available through licensed insurance agents in the state. This expands the scope of what surplus line brokers—who operate outside the standard insurance market—can legally offer to consumers and businesses seeking hard-to-find coverage types.

Why is this important

Surplus line insurance serves niche markets and high-risk situations where standard insurers won't provide coverage. By formally authorizing these brokers to fill this gap, the bill potentially improves access to specialized insurance for Alabamians while reducing reliance on out-of-state insurance solutions. However, it also creates a parallel insurance market with different regulatory oversight than traditional agents.

Potential points of contention

  • Consumer protection standards: Surplus line brokers typically operate under less stringent regulation than standard licensed agents, potentially reducing consumer safeguards and complaint resolution mechanisms
  • Market fragmentation: Expanding surplus line authority may create confusion about which insurance products fall under standard vs. surplus line regulation, complicating consumer decision-making
  • Impact on traditional agents: Licensed insurance agents may view this as unfair competition that allows brokers to operate with fewer restrictions while capturing premium revenue

Compiled from official sources — confirm details with the bill’s official record.

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