38.2-5103 - Risk retention groups not chartered in this Commonwealth.
§ 38.2-5103. Risk retention groups not chartered in this Commonwealth.
Risk retention groups chartered in states other than this Commonwealth andseeking to do business as a risk retention group in this Commonwealth shallobserve and abide by the laws of this Commonwealth as follows:
1. Before offering insurance in this Commonwealth, a risk retention groupshall submit to the Commission on a form prescribed by the Commission:
a. A statement identifying the state or states in which the risk retentiongroup is chartered and licensed as a liability insurance company, date ofchartering, its principal place of business, and such other informationincluding information on its membership, as the Commission may require toverify that the risk retention group is qualified under the definition setforth in this chapter;
b. A copy of its plan of operations or a feasibility study and revisions ofsuch plan or study submitted to its state of domicile; however, the provisionrelating to the submission of a plan of operation or a feasibility studyshall not apply with respect to product liability or completed operationsliability as defined in this chapter which was offered before October 27,1986, by any risk retention group which had been chartered and operating fornot less than three years before such date;
c. A copy of any revision to its plan of operation or feasibility studyrequired by this chapter at the same time that the revision is submitted tothe Commissioner of its chartering state; and
d. A statement of registration which designates the clerk of the Commissionas its agent for the purpose of receiving service of legal documents orprocess.
2. Any risk retention group doing business in this Commonwealth shall submitto the Commission:
a. A copy of the group's financial statement submitted to its state ofdomicile, which shall be certified by an independent public accountant andcontain a statement of opinion on loss and loss adjustment expense reservesmade by a member of the American Academy of Actuaries or a loss reservespecialist who is qualified under criteria established by the NationalAssociation of Insurance Commissioners;
b. A copy of each examination of the risk retention group as certified by thecommissioner or public official conducting the examination;
c. Upon request by the Commission, a copy of any information or documentpertaining to any outside audit performed with respect to the risk retentiongroup; and
d. Such information as may be required to verify its continuing qualificationas a risk retention group under the definition set forth in this chapter.
3. All premiums paid for coverages within this Commonwealth to risk retentiongroups shall be subject to taxation, including the assessment set forth in §38.2-400, at the same rate and subject to the same interest, fines andpenalties for nonpayment as applicable to foreign admitted insurers. Eachrisk retention group shall pay the taxes for risks insured within theCommonwealth. Further, each risk retention group shall report all premiumspaid to it for risks insured within this Commonwealth.
4. Any risk retention group, its agents and representatives, shall complywith § 38.2-510.
5. Any risk retention group shall comply with the provisions of §§ 38.2-500,38.2-501, 38.2-502, 38.2-503, 38.2-504, 38.2-506, and 38.2-512 regardingdeceptive, false, or fraudulent acts or practices. However, the provisions ofthis subdivision do not relieve a risk retention group from the requirementsof any other state statutes regarding deceptive, false, or fraudulent acts orpractices.
6. Any risk retention group must submit to an examination by the Commissionto determine its financial condition if the commissioner of the jurisdictionin which the group is chartered has not initiated an examination or does notinitiate an examination within sixty days after a request by the Commission.Any such examination shall be coordinated to avoid unjustified repetition andconducted in an expeditious manner and in accordance with the NAIC's ExaminerHandbook.
7. Every application form for insurance from a risk retention group and anypolicy issued by a risk retention group shall contain in ten point type onthe front page and the declaration page, the following notice:
NOTICE
This policy is issued by your risk retention group. Your risk retention groupmay not be subject to all of the insurance laws and regulations of yourstate. State insurance insolvency guaranty funds are not available for yourrisk retention group.
8. The following acts by a risk retention group are hereby prohibited:
a. The solicitation or sale of insurance by a risk retention group to anyperson who is not eligible for membership in such group; and
b. The solicitation or sale of insurance by, or operation of, a riskretention group that is in a hazardous financial condition or is financiallyimpaired.
9. No risk retention group shall be allowed to do business in thisCommonwealth if an insurance company is directly or indirectly a member orowner of such risk retention group, other than in the case of a riskretention group all of whose members are insurance companies.
10. The terms of any insurance policy provided by a risk retention groupshall not provide or be construed to provide insurance policy coverageprohibited generally by the laws of this Commonwealth or declared unlawful bythe Supreme Court of Virginia. For the purpose of this subdivision, a riskretention group shall comply with §§ 38.2-227, 38.2-2200, 38.2-2204 and anyother applicable laws of this Commonwealth.
11. A risk retention group not chartered in this Commonwealth and doingbusiness in this Commonwealth shall comply with a lawful order issued in avoluntary dissolution proceeding or in a delinquency proceeding commenced bya state insurance commissioner or the Commission if there has been a findingof financial impairment after an examination under this section.
(1987, c. 585; 1992, c. 588.)