This bill, titled "Relating to consumer credit financing in the sale or lease of motor vehicles," seeks to amend Section 8-37A-4 of the Code of Alabama 1975. The amendment clarifies the requirements of an insurance policy maintained by a provider of motor vehicle value protection agreements. The provider must insure all of its agreements under an insurance policy that pays or reimburses the obligations of the provider in the event of failure to perform. The insurance policy must be issued by an authorized insurer and meet certain criteria, such as having a surplus as to policyholders and paid-in capital of at least $15,000,000. Additionally, the provider may maintain a funded reserve account and place a financial security deposit with the superintendent.

The bill also requires the provider to maintain a net worth or stockholders' equity of at least $100,000,000 and provide the Superintendent of Banks with certain financial documents upon request. If the provider's parent company's financial documents are used to meet the financial security requirement, the parent company must guarantee the provider's obligations relating to motor vehicle value protection agreements sold in the state. The bill will become effective immediately upon passage and approval by the Governor or its otherwise becoming law.