Catastrophe savings accounts, required to be held in Alabama banks, credit unions, or veterans financial institutions and approved by the Commissioner of Insurance

This bill requires catastrophe savings accounts in Alabama to be held only at state-based banks, credit unions, or veterans financial institutions. It directly affects insurance policyholders who use these accounts to pay for deductibles, mitigation costs, or FORTIFIED endorsements related to windstorm damage on residential property. The legislation defines a catastrophe savings account as a regular savings or money market account labeled specifically for qualified catastrophe expenses and limits policyholders to one such account. The rules apply to tax years starting on or after January 1, 2027, with the bill taking effect on October 1, 2026.