The bill HB477 authorizes nonprofit agricultural organizations in Alabama to provide health benefits to their members and their families, defining "health benefits" as non-insurance sponsored offerings. It outlines required coverage areas, including ambulatory services, hospitalization, emergency services, and mental health services, while prohibiting the sale of these benefits by unaffiliated brokers or agents. Applicants must acknowledge in writing that they are not purchasing an insurance policy. The bill also establishes a complaint system for members and requires annual actuarial opinions from the organizations to ensure adequate plan reserves. It clarifies that these organizations are not classified as health insurers and sets conditions for providing health benefits, including restrictions on post-claim medical underwriting and eligibility certification based on employer-sponsored health plans.

Additionally, the bill introduces a 1.3 percent tax on premiums collected by these organizations, which must be reported and paid biannually to the Department of Insurance. This tax is exclusive, preventing other local taxes or licenses from being imposed on the organizations, and they will be exempt from income taxes under Chapter 18 of Title 40 of the Code of Alabama 1975. The Department of Insurance will administer the tax, with a portion allocated for administrative costs, while the remaining funds will support the State General Fund. The act is set to take effect on June 1, 2025, following its passage in the Senate on May 1, 2025.