Virginia Code 38.2-1441: Real estate.
A. A domestic insurer may invest in real estate, as set forth in subsections B, C and D of this section, unless the property is to be used primarily for agricultural, horticultural, ranch, recreational, amusement or club purposes. The term “real estate” as used in this section shall include a leasehold of real estate having an unexpired term of not less than twenty years.
Terms Used In Virginia Code 38.2-1441
- Admitted assets: means , for purposes of the limitations and standards imposed by Articles 1 and 2 of this chapter, the amount thereof as permitted to be reported on the statutory financial statement of the insurer most recently required to be filed with the Commission pursuant to §§ Virginia Code 38.2-1401
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- 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
- Insurer: means a company licensed pursuant to Chapter 10 (§ Virginia Code 38.2-1401
- Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
- Month: means a calendar month and "year" means a calendar year. See Virginia Code 1-223
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- real estate: includes lands, tenements and hereditaments, and all rights and appurtenances thereto and interests therein, other than a chattel interest. See Virginia Code 1-219
- Real property: Land, and all immovable fixtures erected on, growing on, or affixed to the land.
- State: means any commonwealth, state, territory, district or insular possession of the United States. See Virginia Code 38.2-100
- Trustee: A person or institution holding and administering property in trust.
- United States: includes the 50 states, the District of Columbia the Commonwealth of Puerto Rico, Guam, the Northern Mariana Islands and the United States Virgin Islands. See Virginia Code 1-255
B. A domestic insurer may invest in dwellings, offices and other properties (including leasehold estates) for the production of income, other than real estate which is the subject of subsection C, situated in the United States, and the construction thereon of improvements, under the following conditions:
1. The insurer shall either directly or through a land trust own the entire property, except that it may share ownership with one or more insurers authorized to do business in this state, or other business entities, excluding sole proprietorships, having a net worth of at least five million dollars under agreements that will assume concerted action in management and control of the property in case of the insolvency of any participating company, provided that each investment made pursuant to this subsection by the insurer and by each participant shall not be less than $100,000;
2. The insurer alone or in conjunction with participants qualified under subdivision B 1 may let contracts for construction and pay costs of construction and leasing, hold, maintain, lease, and manage the property, collect rents and other income therefrom, and sell the property in whole or in part;
3. The property may be encumbered by lease to tenants and by rights-of-way, easements, mineral reservations, building restrictions, and restrictive covenants, provided none of them can interfere substantially with the use of the property or result in a forfeiture of the property, unless a policy of title insurance, issued by a responsible title insurer qualified to do business in the state wherein the property is located, insures the insurer against loss or damage arising from such encumbrances or reversionary rights; and
4. An insurer shall not invest under this subsection more than four percent of its admitted assets in any one property or in any one grouping of contiguous properties.
C. A domestic insurer may invest in real estate, including leasehold estates, for the convenient accommodation of the insurer’s business operations, including home office, branch office and field office operations, under the following conditions:
1. Any parcel of real estate acquired under this subsection may include excess space for rent to others if it is reasonably anticipated that the excess will be required by the insurer for expansion or if the excess is reasonably required in order to have one or more buildings that will function as an economic unit;
2. The real estate may be subject to a mortgage;
3. An insurer shall not invest under this subsection more than ten percent of the insurer’s admitted assets, except with the permission of the Commission if it is found that such percentage of the insurer’s admitted assets is insufficient to provide convenient accommodation for the insurer’s business; and
4. The permission of the Commission shall be obtained by an insurer prior to the purchase of any real estate under this subsection if the insurer has been authorized in this Commonwealth for a period of less than five years.
D. Real property serving as the residence of an employee of any domestic insurer, other than a director or trustee of the insurer, may be acquired only in connection with the (i) relocation by the insurer of the place of employment of the employee, or (ii) any relocation in connection with the initial employment of the employee. The purchase price shall not exceed the fair market value of the property as determined by written appraisals of at least two competent independent real estate appraisers for the purpose of the acquisition. The employee shall have made reasonable efforts otherwise to dispose of the property for a period of not less than one month immediately prior to the acquisition.
1983, c. 457, § 38.1-217.44; 1986, c. 562; 1992, c. 588.