Vermont Statutes Title 8 Sec. 4692
Terms Used In Vermont Statutes Title 8 Sec. 4692
- Joint underwriting: means a voluntary arrangement established on an ad hoc basis to provide insurance coverage pursuant to which two or more insurers separately contract with the insured at a price and under policy terms agreed upon between the insurers. See
- Market: means the statewide interaction between buyers and sellers of a particular line of insurance or product market component. See
- Person: shall include any natural person, corporation, municipality, the State of Vermont or any department, agency, or subdivision of the State, and any partnership, unincorporated association, or other legal entity. See
- Pool: means a voluntary arrangement other than a residual market mechanism, established on an ongoing basis, pursuant to which two or more insurers participate in the sharing of risks on a predetermined basis. See
- Residual market mechanism: means an arrangement, either voluntary or mandated by law or regulation of the Commissioner, involving participation by insurers in the equitable apportionment among them of insurance that may be afforded applicants who are unable to obtain insurance through ordinary methods. See
- State: when applied to the different parts of the United States may apply to the District of Columbia and any territory and the Commonwealth of Puerto Rico. See
§ 4692. Joint underwriting; pool and residual market activities
(a) Authorization. Notwithstanding section 4693 of this title, insurers participating in joint underwriting, pools, or residual market mechanisms for the purpose of affording insurance under a method of distributing or sharing risks, or both, may, in connection with such activity, act in cooperation with each other in the making of rates; rating systems; policy forms; underwriting rules; surveys; inspections and investigations; the furnishing of loss and expense statistics or other information; or carrying on research. Joint underwriting, pools, and residual market mechanisms shall not be deemed advisory or service organizations.
(b) Regulation.
(1) Except to the extent modified by this section, insurers participating in joint underwriting, pools, and residual market mechanisms are subject to the other provisions of this chapter.
(2) If, after a hearing, the Commissioner finds that any activity or practice of an insurer participating in joint underwriting or a pool is unfair or unreasonable, he or she shall issue a written order specifying in what respects such activity or practice is unfair or unreasonable and require the discontinuance of such activity or practice in addition to any penalties that may be levied.
(3) Every pool shall file for approval of the Commissioner a copy of its constitution, articles of association or incorporation, its bylaws, rules, and regulations governing its activities; a list of its members; the name and address of one or more residents of this State, or the designation of the Secretary of State as a person, upon whom notices or orders of the Commissioner or process may be served; and any changes or amendments in the foregoing.
(4) Any residual market mechanism, plan, or agreement to implement such a mechanism, and any amendments thereto, shall be submitted in writing to the Commissioner for consideration and approval, together with such information as the Commissioner may reasonably require. The Commissioner shall approve only such agreements as are found to contemplate the use of rates that meet the standards prescribed by this chapter and activities and practices that are not unfair, unreasonable, or otherwise inconsistent with the provisions of this chapter. At any time after such agreements are in effect, the Commissioner may review the activities and practices of the parties to such agreements and if, after a hearing, the Commissioner finds that any such activity or practice is unfair, unreasonable, or otherwise inconsistent with the provisions of this chapter, the Commissioner shall issue a written order specifying in what respects such activity or practice is unfair, unreasonable, or otherwise inconsistent with the provisions of this chapter and require the discontinuance of such activity or practice or revoke approval of any such agreement. (Added 1983, No. 238 (Adj. Sess.), § 1.)