Virginia Code 38.2-216: Restrictions on removal or transfer of property and on reinsurance; penalty
A. No domestic insurer shall remove from this Commonwealth either all or substantially all of its property or business without the written approval of the Commission.
Attorney's Note
Under the Virginia Code, punishments for crimes depend on the classification. In the case of this section:| Class | Prison | Fine |
|---|---|---|
| Class 1 misdemeanor | up to 12 months | up to $2,500 |
Terms Used In Virginia Code 38.2-216
- Commission: means the State Corporation Commission. See Virginia Code 38.2-100
- Company: means any association, aggregate of individuals, business, corporation, individual, joint-stock company, Lloyds type of organization, organization, partnership, receiver, reciprocal or interinsurance exchange, trustee or society. See Virginia Code 38.2-100
- Contract: A legal written agreement that becomes binding when signed.
- Insurer: means an insurance company. See Virginia Code 38.2-100
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- Surplus to policyholders: means the excess of total admitted assets over the liabilities of an insurer, and shall be the sum of all capital and surplus accounts, including any voluntary reserves, minus any impairment of all capital and surplus accounts. See Virginia Code 38.2-100
B. No domestic insurer shall transfer or attempt to transfer substantially its entire property, or enter into any transaction the effect of which is to merge substantially its entire property or business into the property or business of any other company, without prior written approval of the Commission.
C. No domestic insurer shall reinsure with any other insurer all or substantially all of its risks without prior written approval of the Commission of the reinsurance and of the contract under which reinsurance is effected.
D. No domestic insurer shall enter into or modify a reinsurance treaty or risk-sharing arrangement without prior written approval of the Commission if for any twelve-month period the reinsurance premium or anticipated change in the ceding insurer’s liabilities equals or exceeds fifty percent of the insurer’s surplus to policyholders as of the immediately preceding December 31.
E. Any director or officer of the insurer consenting to and participating in any violation of this section shall be guilty of a Class 1 misdemeanor.
Code 1950, § 38-6; 1952, c. 317, § 38.1-38; 1986, c. 562; 2000, c. 51.