Virginia Code 38.2-1884: Authority of lessors of self storage units.
A. The employees and authorized representatives of lessors may sell or offer self storage insurance to customers and shall not be subject to licensure as an insurance producer under this chapter provided that:
Terms Used In Virginia Code 38.2-1884
- Commission: means the State Corporation Commission. See Virginia Code 38.2-100
- Customer: means a person who leases a self storage unit. See Virginia Code 38.2-1881
- Discovery: Lawyers' examination, before trial, of facts and documents in possession of the opponents to help the lawyers prepare for trial.
- insurance producer: when used without qualification, means an individual or business entity that sells, solicits, or negotiates contracts of insurance or annuity in the Commonwealth. See Virginia Code 38.2-1800
- Insurer: means an insurance company. See Virginia Code 38.2-100
- 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
- Lessor: means a person in the business of engaging in self storage unit transactions directly or indirectly. See Virginia Code 38.2-1881
- Person: means any association, aggregate of individuals, business, company, 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
- Self storage insurance: means insurance providing coverage against loss of or damage to items of personal property stored in a self storage unit in accordance with the terms of the self storage unit rental agreement. See Virginia Code 38.2-1881
- Self storage unit: means a unit in a building, part of a building, or place used only for storage of personal property by the customer leasing the unit. See Virginia Code 38.2-1881
- State: means any commonwealth, state, territory, district or insular possession of the United States. See Virginia Code 38.2-100
- Terminate: means the cancellation of the relationship between an insurance producer and the insurer, or the termination of an insurance producer's authority to transact insurance. See Virginia Code 38.2-1800
- 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
1. The lessor obtains a limited lines property and casualty insurance agent license;
2. The lessor selling the self storage insurance provides a training program for all employees and authorized representatives of the lessor. The training program shall consist of instruction about the self storage insurance offered to customers, the disclosures required by this article, and the conduct prohibited by § 38.2-512. The training required by this subdivision may be delivered in person or in an electronic form. The licensed producer designated by the lessor as being responsible for its compliance with the insurance laws, rules, and regulations of the Commonwealth, as required by § 38.2-1820, shall hold a property and casualty insurance agent license and shall supervise the administration of the training program required by this subdivision;
3. No employee or authorized representative of a lessor of self storage units is compensated based primarily on the number of customers who purchase self storage insurance coverage; however, such an employee or authorized representative may receive compensation for activities under the limited lines license that is incidental to their overall compensation; and
4. The employee or authorized representative of the lessor of self storage insurance does not represent or otherwise hold himself out as a licensed insurance producer.
B. No employee or authorized representative of a lessor of a self storage unit may:
1. Evaluate or interpret the technical terms, benefits, and conditions of the offered self storage unit insurance;
2. Evaluate or provide advice concerning a prospective purchaser’s existing insurance coverage; or
3. Hold himself out as a licensed insurer, licensed agent, or insurance expert.
C. The license authority of any lessor licensed as a limited lines property and casualty producer selling self storage insurance shall terminate immediately if the sole licensed responsible producer designated for the lessor’s compliance with the insurance laws, rules, and regulations of the Commonwealth is removed for any reason, and a new responsible producer has not been appointed. The Commission shall be notified within 30 calendar days of such removal and of the newly designated responsible producer.
D. A lessor shall report any violation of this article to the Commissioner within 30 days of discovery of the violation by the lessor.
E. Any charge to the customer for self storage insurance that is not included in the cost associated with the lease of a self storage unit shall be separately itemized on the customer’s rental agreement. If the charge for self storage insurance is included in the cost associated with the lease of the self storage unit, the lessor shall clearly and conspicuously disclose to the customer that the charge for the self storage unit covers the cost of the insurance.
F. The charges for self storage insurance coverage may be billed and collected by the lessor. Lessors billing and collecting premiums for self storage insurance shall be required to comply with the provisions of § 38.2-1813. Lessors may receive compensation for billing and collection services.
G. Notwithstanding any other provision of law, applicants for licensure pursuant to this article whose home state does not issue a producer license with a similar line of authority as the license authorized by this article shall be issued a limited lines property and casualty license for self storage insurance. Any licensee whose home state does not have property and casualty limited lines for self storage insurance or similar line of authority in its home state after July 1, 2017, or such later date as may be determined by the Commission, shall obtain a full property and casualty license or its license shall terminate in Virginia. For purposes of this subsection, “home state” means the District of Columbia and any state or territory of the United States except Virginia, or any province of Canada, in which an applicant maintains such person’s principal place of residence or principal place of business.