Virginia Code 38.2-1708: Detection and prevention of insolvencies.
A. To aid in the detection and prevention of member insurer insolvencies, the Commission shall have the duty to:
Terms Used In Virginia Code 38.2-1708
- Account: means any one of the two accounts created under § Virginia Code 38.2-1701
- Association: means the Virginia Life, Accident and Sickness Insurance Guaranty Association created under § Virginia Code 38.2-1701
- Commission: means the State Corporation Commission. See Virginia Code 38.2-100
- Contract: A legal written agreement that becomes binding when signed.
- Germane: On the subject of the pending bill or other business; a strict standard of relevance.
- Insolvent insurer: means a member insurer that is placed under an order of liquidation by a court of competent jurisdiction with a finding of insolvency. See Virginia Code 38.2-1701
- Insurer: means an insurance company. See Virginia Code 38.2-100
- Member insurer: means an insurer or health maintenance organization licensed to transact in the Commonwealth any class of insurance or health maintenance organization business to which this chapter applies under § Virginia Code 38.2-1701
- Process: includes subpoenas, the summons and complaint in a civil action, and process in statutory actions. See Virginia Code 1-237
- State: means any commonwealth, state, territory, district or insular possession of the United States. See Virginia Code 38.2-100
1. Notify the insurance departments of all of the other states within 30 days following the action taken or the date the action occurs, when the Commission takes any of the following actions against a member insurer:
a. Revocation of license;
b. Suspension of license; or
c. Enters a formal order that the member insurer restrict its premium writing, obtain additional contributions to surplus, withdraw from the Commonwealth, reinsure all or any part of its business, or increase capital, surplus, or any other account for the security of policy owners, contract owners, certificate holders, or creditors;
2. Report to the board of directors when the Commission has taken any of the actions set forth in subdivision 1 or has received a report from any other insurance department indicating that any such action has been taken in another state. The report to the board of directors shall contain all significant details of the action taken or the report received from another insurance department;
3. Report to the board of directors when the Commission has reasonable cause to believe from an examination, whether completed or in process, of any member insurer that the member insurer may be an impaired or insolvent insurer; and
4. Furnish to the board of directors the National Association of Insurance Commissioners (NAIC) Insurance Regulatory Information System (IRIS) ratios and listings of companies not included in the ratios developed by the NAIC, and the board may use the information contained therein in carrying out its duties and responsibilities under this section. The report and the information contained therein shall be kept confidential by the board of directors until such time as made public by the Commission or other lawful authority.
B. The Commission may seek the advice and recommendations of the board of directors concerning any matter affecting its duties and responsibilities regarding the financial condition of member insurers and insurers or health maintenance organizations seeking admission to transact business in the Commonwealth.
C. The board of directors may, upon majority vote, make reports and recommendations to the Commission upon any matter germane to the solvency, liquidation, rehabilitation or conservation of any member insurer or germane to the solvency of any insurer or health maintenance organization seeking to transact business in the Commonwealth. These reports and recommendations shall not be considered public documents.
D. The board of directors, upon majority vote, may notify the Commission of any information indicating a member insurer may be an impaired or insolvent insurer.
E. The board of directors, upon majority vote, may make recommendations to the Commission for the detection and prevention of member insurer insolvencies.
1976, c. 330, § 38.1-482.26; 1986, c. 562; 2010, c. 510; 2018, c. 706.