dcrodriguez/Code-of-Virginia huggingface dataset:
Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2503. Classes of insurance that may be written by mutual assessment property and casualty insurers; minimum surplus to policyholders required.
A. Any mutual assessment property and casualty insurer with surplus to policyholders of at least $25,000 may write the following classes:

1. Fire insurance as defined in § 38.2-110;

2. Miscellaneous property damage insurance as defined in § 38.2-111; and

3. Animal insurance as defined in § 38.2-116.

B. Any mutual assessment property and casualty insurer with surplus to policyholders of at least $100,000 may write the following classes of insurance, in addition to those classes enumerated in subsection A of this section:

1. Water damage insurance as defined in § 38.2-112;

2. Burglary and theft insurance as defined in § 38.2-113;

3. Glass insurance as defined in § 38.2-114;

4. Boiler and machinery insurance as defined in § 38.2-115;

5. Personal injury liability insurance as defined in § 38.2-117;

6. Property damage liability insurance as defined in § 38.2-118;

7. Marine insurance as defined in § 38.2-126;

8. Home protection insurance as defined in § 38.2-129;

9. Homeowners insurance as defined in § 38.2-130;

10. Farmowners insurance as defined in § 38.2-131;

11. Commercial multi-peril insurance as defined in § 38.2-132; and

12. Contingent and consequential losses insurance as defined in § 38.2-133.

The liability coverages specified in this subsection may be written only by insurers having a surplus to policyholders of at least $300,000 unless the coverages are fully reinsured.

C. Any mutual assessment property and casualty insurer with surplus to policyholders of at least $800,000 may write the following classes of insurance, in addition to those classes enumerated in subsections A and B of this section:

1. Workers' compensation and employers' liability insurance as defined in § 38.2-119;

2. Fidelity insurance as defined in § 38.2-120;

3. Surety insurance as defined in § 38.2-121;

4. Credit insurance as defined in § 38.2-122;

5. Motor vehicle insurance as defined in § 38.2-124;

6. Aircraft insurance as defined in § 38.2-125;

7. Legal services insurance as defined in § 38.2-127; and

8. Mortgage guaranty insurance as defined in § 38.2-128.

Code 1950, §§ 38-523, 38-526, 38-529; 1952, c. 317, § 38.1-659; 1954, c. 161; 1960, c. 292; 1962, c. 172; 1974, c. 244; 1986, c. 562.
Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2504. Property beyond authorized territory.
A mutual assessment property and casualty insurer shall not insure real property outside the limits of the territory for which it is authorized to write insurance as specified in its charter or bylaws. However, members may be provided liability or other insurance on risks other than real property insurable under this chapter, wherever located. When members own real property near the border of the territory which extends in a contiguous manner beyond the territory, all of the property may be insured if otherwise insurable under this chapter, whether the property is within or without the territory.

Code 1950, §§ 38-526, 38-529; 1952, c. 317, § 38.1-661; 1986, c. 562.

Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2505. Risks limited to those specified in this chapter; personal liability for loss.
No mutual assessment property and casualty insurer shall insure against any losses except as specified in this chapter. Any officer or agent who knowingly or willfully violates or who causes the insurer to violate this provision shall be fined in accordance with § 38.2-218.

Code 1950, § 38-541; 1952, c. 317, § 38.1-687; 1986, c. 562.

Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2506. What laws applicable.
Except as otherwise provided in this chapter, and except when the context otherwise requires, all the provisions of this title relating to insurers generally, and those relating to insurers writing the same class of insurance that mutual assessment property and casualty insurers are authorized to write under this chapter, are applicable to these insurers.

The provisions of §§ 38.2-1032 and 38.2-1035 shall not apply to mutual assessment property and casualty insurers.

Code 1950, §§ 38-505, 38-525; 1952, c. 317, §§ 38.1-91, 38.1-662; 1960, c. 289; 1966, c. 580; 1986, c. 562.
Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2507. Conversion of mutual assessment property and casualty insurers.
A. Any mutual assessment property and casualty insurer desiring to remove itself from the provisions of this chapter and desiring to become an insurer under the provisions of Chapter 10 (§ 38.2-1000 et seq.) of this title may do so by meeting the requirements of Chapter 10. The mutual assessment property and casualty insurer shall submit an application to the Commission showing that each requirement of Chapter 10 has been met. If the applicant does not meet the requirements of Chapter 10, the applicant may submit a plan that includes a schedule for meeting the requirements of Chapter 10. The schedule shall provide for compliance with those requirements within ten years of the approval of the application. For good cause shown, the Commission may grant, after informal hearing, an additional period in order to achieve compliance with the requirements of Chapter 10.

B. If the Commission approves the application, the insurer shall have all the rights, privileges and responsibilities of an insurer licensed under the provisions of Chapter 10 of this title.

C. Upon failure of the applicant to comply with the terms of the approved schedule, the Commission may require the applicant to adhere to the provisions of this chapter.

1986, c. 562.

Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2508. Incorporation of insurers.
Mutual assessment property and casualty insurers formed after July 1, 1986, shall be incorporated under the provisions of Article 3 (§ 13.1-818 et seq.) of Chapter 10 of Title 13.1, as modified by the provisions of this title. Except as otherwise provided in this title, mutual assessment property and casualty insurers shall be subject to all the general restrictions and have all the general powers imposed and conferred upon those corporations by law. Mutual assessment property and casualty insurers formed prior to July 1, 1986, may continue to operate as organized.

Code 1950, § 38-523; 1952, c. 317, § 38.1-666; 1956, c. 431; 1986, c. 562.
Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2509. Directors; terms; annual meetings; voting; executive committee.
As provided in the certificate or articles of incorporation and the bylaws, the management of any mutual assessment property and casualty insurer shall be vested in a board of at least five directors, each of whom shall be a member of the insurer. Each director shall hold office for one year or for a longer term if specified in the bylaws, and thereafter until his successor is elected and has qualified. Vacancies in the board may be filled for the unexpired term by the remaining directors. The annual meeting of the members of the insurer shall be held as provided by the certificate or articles of incorporation or the bylaws. A quorum shall consist of (i) ten members or (ii) the number of members specified by either the certificate or articles of incorporation or the bylaws, whichever number is larger. In all meetings of members, each member of the insurer shall be entitled to one vote, or a number of votes based upon insurance in force, the number of policies held or the amount of premiums paid as provided by the bylaws of the insurer. Votes by proxy may be received in accordance with the certificate or articles of incorporation or the bylaws. The date of the annual meeting shall be stated in the policy, or notice of the date and location of the annual meeting shall be provided annually. Notwithstanding the provisions of the charter of any insurer, upon a resolution adopted by the board of directors and approved by a majority of its members present in person or by proxy, the directors may be divided into classes and a portion only elected each year. Pursuant to the provisions of § 13.1-869, the directors may appoint an executive committee to exercise the powers and perform the duties set out in that section.

1952, c. 317, § 38.1-667; 1956, c. 431; 1986, c. 562.

Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2510. Officers.
Unless the certificate or articles of incorporation provides otherwise, the directors shall elect from their number a president. The directors shall also elect a secretary, treasurer, and any additional officers they consider necessary, who may or may not be members. The offices of secretary and treasurer may be held by one person. Unless otherwise provided in the certificate or articles of incorporation, the term of those officers shall be not less than one year nor more than three years or until their successors are elected or selected and qualified.

1952, c. 317, § 38.1-667.1; 1986, c. 562.
Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2511. How license obtained.
The applicant insurer shall file with and have approved by the Commission its application for the license required by § 38.2-1024 prior to transacting the business of insurance in this Commonwealth. The Commission shall not grant a license to any insurer until it is satisfied that the insurer has complied with the requirements of § 38.2-1024 and has filed with the Commission a statement signed by its president and secretary or two of its directors subject to § 38.2-1304, setting forth:

1. That the corporation holds bona fide applications for insurance of the classes proposed to be issued from 100 or more persons who own property insurable by the insurer under the provisions of this chapter and who desire to become members of the insurer;

2. The names of the proposed members and the amount of insurance subscribed for by each;

3. A statement that the insurer has received from each proposed member the initial fees and assessments required for the insurance requested;

4. The names and addresses of the officers and directors of the insurer;

5. The location of the insurer's principal office in this Commonwealth;

6. The classes of insurance proposed to be written; and

7. The territory within which the insurer proposes to transact insurance.

Code 1950, § 38-524; 1952, c. 317, § 38.1-668; 1986, c. 562.

Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2512. Who may become members.
Any person having a risk insurable under this chapter who resides in the territory in which the insurer operates or who owns property located in the territory may become a member of a mutual assessment property and casualty insurer and shall be entitled to all the rights and privileges pertaining to membership. Any officer, trustee, board member or legal representative of a corporation, board, estate or association may be recognized as acting for or on its behalf for the purpose of the membership, but shall not be personally liable under the contract of insurance by reason of acting in such representative capacity.

1952, c. 317, § 38.1-669; 1986, c. 562.
Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2513. Withdrawal and exclusion of members.
A. Any member of a mutual assessment property and casualty insurer may withdraw as a member at any time by giving at least thirty days' written notice to the insurer and paying his share of all losses against the insurer that have occurred prior to the member's withdrawal and which have not been fully reserved or for which surplus is inadequate. Upon this withdrawal the member shall be paid by the insurer any unearned premium, unearned fee or unearned assessment paid in advance.

B. Any member who neglects or refuses to pay an assessment or premium when due may be excluded from membership for that or any other reason satisfactory to a majority of the directors or the executive committee, or as the bylaws prescribe. The member shall remain liable for the payment of any assessments made for losses that have occurred prior to his exclusion, and also for the amounts provided for in § 38.2-2522, if action is instituted within twelve months after the time the assessments become due.

Code 1950, §§ 38-527, 38-537; 1952, c. 317, §§ 38.1-669.1, 38.1-670; 1986, c. 562.

Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2514. Procedure upon exclusion of member.
If any member is excluded from the insurer as provided in this article, the insurer shall note upon its records the exclusion of the member, the cancellation of his insurance policies, and the date of the exclusion. The insurer shall notify the member by mail of the exclusion and cancellation, and after at least five days have elapsed from the mailing of the notice, the policy shall no longer be effective and all further liability of the insurer under the policy shall cease. Proper notification shall be deemed to have been effected if the notice is deposited with the United States Postal Service and mailed to the member at his address as shown on the records of the insurer. If the bylaws or the policy provide that a member's policy shall be void without any notice if the member neglects or refuses to pay any assessment, that provision shall be valid and the notice required in this section need not be given. Upon the cancellation of the insurance or upon the policy becoming void, the member shall be entitled to receive from the insurer a repayment of an equitable portion of any premium, fee or assessment which was paid in advance.

Code 1950, §§ 38-537, 38-538; 1952, c. 317, § 38.1-671; 1986, c. 562.
Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2515. Insurers to maintain membership of 100 or more; license suspended or revoked if membership not maintained; rehabilitation or liquidation.
Every mutual assessment property and casualty insurer shall maintain a membership of at least 100 persons at all times. Whenever the number of members falls below 100, the insurer shall notify the Commission immediately of that fact. Upon receipt of that notice, or upon information from any source that the membership of the insurer is less than 100, the Commission may revoke the insurer's license, or may issue an order requiring the insurer to increase its membership to at least 100 within a designated period not exceeding 90 days.

If at the expiration of the designated period the membership has not been increased to at least 100, the Commission shall revoke the insurer's license. Upon the revocation of its license as authorized in this section, delinquency proceedings against the insurer may be instituted and conducted as provided in Chapter 15 of this title.

1952, c. 317, § 38.1-672; 1986, c. 562.

Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2516. Issuance of policies; bylaws as part of contract.
The directors of every mutual assessment property and casualty insurer shall issue insurance policies requiring the insurer to pay all losses or damages caused by the risk insured against during the time the policy is in force. Payment shall not exceed the amount insured. There shall be attached to or included in each of those policies the portion of the bylaws that constitute a part of the policy contract. Bylaws or their amendments that are not a part of the policy contract shall not affect the policy contract unless they are included as a suitable endorsement mailed or delivered to the policyholder.

Code 1950, § 38-529; 1952, c. 317, § 38.1-673; 1954, c. 161; 1986, c. 562.

Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2517. Policy forms to be filed.
Every mutual assessment property and casualty insurer shall file with the Commission a copy of all policy forms and standard endorsements which the insurer intends to use in the transaction of its business. Mutual assessment property and casualty insurers shall be exempt from the filing requirements of Chapter 3 (§ 38.2-300 et seq.) of this title except for those classes of insurance enumerated in subsection C of § 38.2-2503, where full compliance with Chapter 3 shall be required.

1986, c. 562.
Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2518. Assessment contract.
Each person insured by a mutual assessment property and casualty insurer shall be issued a contract prescribed by the insurer, that shall be uniform among members of the respective classes of insurance written by the insurer. Each member shall agree to pay his pro rata share of all losses or damages sustained, expenses of operation of the insurer, and the maintenance of an adequate surplus to policyholders as determined by the board of directors. Periodic assessments may be collected as advance premiums or post assessments or by both methods. The amount of assessments shall be established by the directors of the insurer.

Code 1950, § 38-530; 1952, c. 317, § 38.1-677; 1954, c. 161; 1986, c. 562.

Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2519. Classification of risks; rates.
Any insurer writing mutual assessment property and casualty insurance may classify the property or risk insured in accordance with the risk or hazard to which the property is subject, and fix the rate of assessment or premium for that insurance in accordance with the classification.

Code 1950, § 38-531; 1952, c. 317, § 38.1-676; 1974, c. 244; 1986, c. 562.

Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2520. Right to limit assessment liability.
Any mutual assessment property and casualty insurer having a surplus to policyholders equal to at least 3 times the average annual losses and expenses of the insurer during the last 5-year period or a surplus to policyholders of at least $800,000 may limit the assessment liability of members. The liability of members for assessment may be limited during any one year to an amount not less than one additional current annual assessment.

1952, c. 317, § 38.1-683.1; 1986, c. 562.

Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2521. Notice of assessment; how given.
After an assessment is made, the insurer shall give every member subject to the assessment written notice stating the amount of the member's assessment and the date when payment is due. Except where the provisions of the bylaws or the policy provide otherwise, the time of payment shall be at least thirty days and no more than sixty days from the service of the notice. That notice may be served personally, by mail, or by electronic delivery pursuant to § 38.2-325. If mailed, the notice shall be deposited with the United States Postal Service and addressed to the member at his residence or place of business as shown on the company records.

Code 1950, § 38-535; 1952, c. 317, § 38.1-684; 1986, c. 562; 2020, c. 216.
Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2522. Action to recover assessments; penalty.
Within twelve months after an assessment becomes due, a mutual assessment property and casualty insurer may institute suit against any member to recover any assessment that the member fails to pay. The insurer shall be entitled to recover (i) the amount shown to be due, (ii) lawful interest, and (iii) fifty percent of the principal amount as liquidated damages for neglect or refusal to pay within the time required.

Code 1950, § 38-536; 1952, c. 317, § 38.1-685; 1986, c. 562.

Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2523. Notice of loss and adjustment.
Each policyholder after sustaining loss or damage from any cause specified in the policy shall notify the mutual assessment property and casualty insurer within the time prescribed in the policy. The insurer shall promptly proceed to ascertain and adjust the loss or damage in the manner provided by the policy, law and bylaws of the company.

Code 1950, § 38-530; 1952, c. 317, § 38.1-678; 1986, c. 562.

Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2524. Proceeding when loss or damage exceeds cash on hand.
If at any time any loss or damage to property insured by a mutual assessment property and casualty insurer exceeds the insurer's cash available to pay the loss or damage, the insurer may borrow money in an amount sufficient to pay the loss or damage. This shall be approved by the board of directors or the executive committee. The board of directors or the executive committee may levy an assessment sufficient to repay the loan or to pay the loss or damage, or any portion that is in excess of the cash on hand.

Code 1950, § 38-532; 1952, c. 317, § 38.1-681; 1986, c. 562.

Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2525. Agents licenses required.
Agents representing a mutual assessment property and casualty insurer shall be licensed by the Commission and appointed by the insurer in accordance with Chapter 18 of this title. However, agents whose licenses are limited to those classes of insurance referred to in subsections A and B of § 38.2-2503 shall not be required to take a written examination from the Commission in accordance with § 38.2-1814.

1986, c. 562.
Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2526. Surplus to policyholders.
A. Surplus to policyholders in addition to the required surplus specified in subsections A and B of § 38.2-2503 may be accumulated in amounts as determined by the board of directors. The surplus may be used for the payment of losses and operating expenses of the insurer.

B. Income earned on any surplus to policyholders may be used to pay losses, operating expenses, or added to surplus.

C. The provisions of this section shall become effective July 1, 1986.

D. Any mutual assessment property and casualty insurer already licensed on July 1, 1986, shall comply with the minimum surplus requirements of § 38.2-2503 by July 1, 1991. Any mutual assessment property and casualty insurer that does not meet the surplus requirements of this section as of July 1, 1986, and is not writing any of the classes authorized in subsections B and C of § 38.2-2503 on July 1, 1986, shall not write any of those classes until the specified surplus requirement is met.

1986, c. 562.

Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2527. Limitation on single risk to be assumed.
A. No single risk shall be assumed by a mutual assessment property and casualty insurer in an amount exceeding ten percent of its surplus to policyholders. Any risk or portion of any risk which has been reinsured in accordance with § 38.2-2528 shall be deducted in determining the limitation of risk prescribed by this section. For the purposes of this section the amount of surplus to policyholders shall be determined on the basis of the last financial statement of the insurer, or the last report of examination filed with the Commission, whichever is more recent, at the time the risk is assumed. Mutual assessment property and casualty insurers licensed on or before July 1, 1986, shall conform to this limitation by July 1, 1991.

B. Until July 1, 1991, the following single risk limits after deducting for reinsurance will apply:

1. No insurer having less than $2 million insurance in force shall insure any 1 risk for more than $10,000;

2. No insurer having more than $2 million but less than $5 million insurance in force shall insure any 1 risk for more than $12,000;

3. No insurer having more than $5 million but less than $10 million insurance in force shall insure any 1 risk for more than $20,000;

4. No insurer having more than $10 million insurance in force shall insure any 1 risk for a sum in excess of 15 cent(s) for each $100 insurance it has in force; and

5. An insurer may insure any one risk in larger sums than prescribed in this section if (i) the excess over such prescribed maximum is reinsured as authorized in this chapter or (ii) the excess may be increased by the extent of twenty-five percent of the surplus of the insurer as of the time the insurance is written.

1986, c. 562.
Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2528. Reinsurance.
Any mutual assessment property and casualty insurer may reinsure the whole or any part of its risks with any solvent insurer licensed in this Commonwealth or licensed or approved in any other state and meeting standards of solvency at least equal to those required in this Commonwealth if the reinsurance is ceded without contingent liability on the part of the reinsured insurer. Any mutual assessment property and casualty insurer having a surplus in excess of $800,000 may accept or assume reinsurance from any licensed property and casualty insurer. Any of those companies may accept or assume reinsurance on risks located within or without the territory in which it is authorized to transact insurance.

Nothing in this section shall be construed to prohibit the participation of a mutual assessment property and casualty insurer in a pool or other plan among similar companies approved by the Commission for the purpose of spreading losses or providing reinsurance or catastrophe coverage for participants. The acceptance of reinsurance by any insurer outside the territory in which it is authorized to transact the business of insurance shall not be construed to enlarge its territory so as to affect any tax exemption to which it may be entitled.

1952, c. 317, § 38.1-675; 1986, c. 562.

Code of Virginia — Title 38.2 (Insurance), Chapter 25 (Mutual Assessment Property and Casualty Insurers)
§ 38.2-2529. Unearned premium reserves required.
A. Advance assessments received by mutual assessment property and casualty insurers shall be considered premiums and, except as provided in subsection B of this section, shall be subject to the requirement of an unearned premium reserve computed in accordance with § 38.2-1312. The reserves may be reduced for applicable reinsurance in accordance with the provisions of Article 3.1 (§ 38.2-1316.1 et seq.) of Chapter 13 of this title.

B. The amount each insurer shall maintain in reserves for unearned premium reserves shall be as follows:

1. For calendar year 1987, at least ten percent of the unearned premium reserve as calculated in subsection A of this section; and

2. For each subsequent year, at least an additional ten percent as calculated in subsection A for that subsequent year in order that the full amount of unearned premium reserves shall be established by December 31, 1996.

1986, c. 562; 1994, c. 316.
Code of Virginia — Title 38.2 (Insurance), Chapter 26 (Home Protection Companies)
§ 38.2-2600. Definitions.
As used in this chapter:

"Fronting company" means a licensed insurer or licensed home protection company which generally transfers to one or more unlicensed insurers or unlicensed home protection companies by reinsurance or otherwise all or substantially all of the risk of loss under all of the home protection contracts written by it in this Commonwealth.

"Home protection company" means any person who performs, or arranges to perform, services pursuant to a home protection insurance contract.

"Home protection insurance contract" or "contract" means any insurance contract or agreement whereby a person undertakes for a specified period of time and for a predetermined fee to furnish, arrange for or indemnify for service, repair, or replacement of any and all of the structural components, parts, appliances, or systems of any covered residential dwelling necessitated by wear and tear, deterioration, inherent defect, or by the failure of an inspection to detect the likelihood of failure.

The contract shall provide for a system to effect repair or replacement if the contract undertakes to provide for repair or replacement services. The contract shall not include protection against consequential damage from the failure of any structural component, part, appliance or system.

"Structural component" means the roof, foundation, basement, walls, ceilings, or floors of a home.

1981, c. 530, §§ 38.1-932, 38.1-944; 1982, c. 132; 1986, c. 562; 2006, c. 634; 2017, c. 727.

Code of Virginia — Title 38.2 (Insurance), Chapter 26 (Home Protection Companies)
§ 38.2-2601. Exemptions.
This chapter shall not apply to:

1. Performance guarantees given by either (i) the builder of a home or (ii) the manufacturer, seller, or lessor of the property that is the subject of the contract if no identifiable charge is made for the guarantee.

2. Any service contract, guarantee, or warranty intending to guarantee or warrant the repairs or service of a home appliance, component, part, or system that is issued (i) by a person who has sold, serviced, repaired, or provided replacement of the appliance, component, part, or system at the time of or prior to issuance of the service contract, guarantee or warranty if such person does not engage in the business of a home protection company or (ii) by a home protection company which sells such service contracts, guarantees or warranties in the Commonwealth of Virginia and which has net worth in excess of $100 million.

1981, c. 530, § 38.1-933; 1986, c. 562; 1992, c. 21; 2006, c. 634; 2017, c. 727.
Code of Virginia — Title 38.2 (Insurance), Chapter 26 (Home Protection Companies)
§ 38.2-2602. Limited applicability to certain insurers.
A property and casualty insurer may be licensed to transact home protection insurance as defined in § 38.2-129. An insurer licensed in this Commonwealth to transact the class of insurance defined by § 38.2-111 on July 1, 1986, may also transact home protection insurance without additional authority. No other provision of this chapter, except § 38.2-2606 and §§ 38.2-2608 through 38.2-2614, shall be applicable to the insurers, their businesses, or their home protection contracts.

1981, c. 530, §§ 38.1-933, 38.1-945; 1986, c. 562; 2006, c. 634; 2017, c. 727.

Code of Virginia — Title 38.2 (Insurance), Chapter 26 (Home Protection Companies)
§ 38.2-2603. License required; application; fee.
Except as provided in § 38.2-2602, no home protection company shall issue or offer to issue home protection contracts in this Commonwealth until a home protection company license has been granted by the Commission. Application for a license shall be made in writing, in the form prescribed by the Commission, and shall be accompanied by a nonrefundable application fee of $500.

1981, c. 530, § 38.1-933; 1986, c. 562.
Code of Virginia — Title 38.2 (Insurance), Chapter 26 (Home Protection Companies)
§ 38.2-2604. Qualification for license; net worth; deposit of securities with State Treasurer.
A. No license shall be issued to any home protection company unless the applicant:

1. Is a Virginia corporation formed under the provisions of Article 3 (§ 13.1-618 et seq.) of Chapter 9 of Title 13.1, or Article 3 (§ 13.1-818 et seq.) of Chapter 10 of Title 13.1; or

2. Is a foreign corporation subject to regulation and licensing under the laws of its domiciliary jurisdiction which are substantially similar to those provided in this chapter, and has obtained a certificate of authority to transact business in this Commonwealth;

3. Furnishes the Commission with evidence satisfactory to it that the management of the home protection company is competent and trustworthy, and can be reasonably expected to successfully manage the company's affairs in compliance with law;

4. Establishes to the satisfaction of the Commission that it (i) maintains employees or has contractual arrangements sufficient to provide the services or indemnity undertaken by it, and (ii) agrees to accept requests for heating, electrical and plumbing services contracted for twenty-four hours per day, seven days per week;

5. Makes the deposit of bonds or other securities required by this section;

6. Is otherwise in compliance with this chapter;

7. Has filed the required application and paid the required fee;

8. Has paid all fees, taxes, and charges required by law;

9. Has the minimum net worth prescribed by this section;

10. Has filed any financial statement and any reports, certificates, or other documents as the Commission deems necessary to secure a full and accurate knowledge of its affairs and financial condition; and

11. Keeps adequate, correct and complete books and records of accounts and maintains proper accounting controls.

B. The Commission shall not issue a license to or renew the license of a home protection company unless it is satisfied that the financial condition, the method of operation, and the manner of doing business enable the home protection company to meet its obligations to all contract holders and that the home protection company has otherwise complied with all the requirements of law.

C. A home protection company shall maintain a net worth in an amount not less than 20% of the premiums charged on its contracts currently in force; however, the minimum required net worth shall be not less than $100,000, and the maximum required net worth shall be that amount required of insurers under the provisions of Article 5 (§ 38.2-1024 et seq.) of Chapter 10 of this title.

D. No license shall be granted to any home protection company until it presents to the Commission a certificate of the State Treasurer that bonds or other securities have been deposited with him to be held in accordance with the provisions of and upon the terms and conditions and in the amount as provided in Article 7 (§ 38.2-1045 et seq.) of Chapter 10 of this title.

1981, c. 530, § 38.1-934; 1982, c. 132; 1984, c. 640; 1986, c. 562; 2006, c. 634; 2017, c. 727.
Code of Virginia — Title 38.2 (Insurance), Chapter 26 (Home Protection Companies)
§ 38.2-2605. Expiration and renewal of license.
Every home protection company licensed under this chapter shall obtain a renewal of its license annually from the Commission. Every license issued under this chapter shall expire at midnight on June 30 immediately following the date of issuance. No renewal license shall be issued unless the home protection company has paid all taxes, fees, assessments and other charges imposed upon it, and has complied with all the other requirements of law. The Commission shall not fail or refuse to renew the license of any home protection company without giving the home protection company ten days' notice of the failure or refusal to renew and providing it an opportunity to be heard and to introduce evidence in its behalf. Any such hearing may be informal, and the required notice may be waived by the Commission and the home protection company.

1981, c. 530, § 38.1-935; 1986, c. 562; 2006, c. 634; 2017, c. 727.

Code of Virginia — Title 38.2 (Insurance), Chapter 26 (Home Protection Companies)
§ 38.2-2606. Reserves required.
A home protection company licensed in this Commonwealth shall maintain reserves in an amount sufficient to provide for its liability to furnish appropriate indemnity, repairs, and replacement services under its issued and outstanding contracts. The reserve account shall be calculated according to sound actuarial principles, but shall equal at a minimum fifty percent of the premiums received from all contracts in force in this Commonwealth, net of applicable reinsurance and any amounts paid on account of liabilities incurred under the contracts. To receive credit for reinsurance on home protection contracts, the reinsurance contract or policy shall be issued by a solvent insurer licensed in this Commonwealth or any other state having standards of solvency at least equal to those required in this Commonwealth.

1981, c. 530, § 38.1-936; 1986, c. 562.

Code of Virginia — Title 38.2 (Insurance), Chapter 26 (Home Protection Companies)
§ 38.2-2607. Annual statements.
On or before March 1 of each year, each home protection company shall file with the Commission its annual statement pursuant to the provisions of § 38.2-1300, in the form prescribed by the Commission. The annual statement may be based on accounting principles common to the home protection business, provided that they enable the Commission to ascertain whether the reserves required by § 38.2-2606 have been established. However, the Commission may prescribe a uniform accounting system to be used by home protection companies. The Commission may also require the uniform reporting of statistical information under a plan prescribed or approved by the Commission.

1981, c. 530, § 38.1-937; 1986, c. 562.
Code of Virginia — Title 38.2 (Insurance), Chapter 26 (Home Protection Companies)
§ 38.2-2608. Home protection contracts; filing; form and contents; application or agreement to purchase; regulation of rates and charges.
A. No home protection contract shall be issued or used in this Commonwealth unless it has been filed with and approved by the Commission.

B. No home protection contract shall be issued in this Commonwealth unless it:

1. Is written in simple and readable words with common meanings and is understandable without special insurance knowledge or training;

2. Specifically sets forth:

a. The services to be performed by the home protection company and the terms and conditions of the performance;

b. Any service fee or deductible amount applicable per claim or per occurrence;

c. Each of the systems, appliances, and structural components covered by the contract;

d. All exclusions and limitations respecting the extent of coverage;

e. The period during which the contract will remain in effect and the cancellation provision;

f. All limitations regarding the performance of services, including any restrictions as to the time periods when services will be performed;

3. Provides for the initiation of covered services contracted for upon telephonic request without first requiring the filing of written claim forms or written applications; and

4. Provides for the initiation of covered services contracted for by or under the direction of the home protection company within seventy-two hours of the request for the service by the contract holder, and provides for the completion of the services as soon as reasonably possible. For malfunctions of furnace or heating systems during the winter months, the contract must provide for the initiation of services immediately.

C. Every application for or agreement to purchase a home protection contract shall include a statement that the purchase of the contract is not mandatory and may be waived, and shall include a statement of the premium.

D. 1. Chapter 20 (§ 38.2-2000 et seq.) of this title shall apply to the rates charged by home protection companies until such time as the Commission determines, after proper notice and hearing, that sufficient competition exists in the home protection industry to justify its regulation under Chapter 19 (§ 38.2-1900 et seq.) of this title. Upon this determination, Chapter 19 of this title shall apply to the rates charged by home protection companies.

2. No home protection company shall make or issue a contract except in accordance with the filings that are in effect for that company. No home protection company or any of its representatives shall charge or receive any fee, compensation or consideration for the contract that is not included in the rate in effect for that company.

3. The rates charged shall be based on sound actuarial principles and shall not be excessive, inadequate, or unfairly discriminatory as defined in § 38.2-1904.

1981, c. 530, § 38.1-938; 1984, c. 640; 1986, c. 562.
Code of Virginia — Title 38.2 (Insurance), Chapter 26 (Home Protection Companies)
§ 38.2-2609. Qualifications of agents.
No person shall sell, solicit, or negotiate home protection contracts in this Commonwealth unless (i) he has a valid license granting the authority to transact such insurance in this Commonwealth, (ii) he has a valid license to sell real estate in this Commonwealth, issued pursuant to Chapter 21 (§ 54.1-2100 et seq.) of Title 54.1, or (iii) he is the builder of the home or one of his authorized agents.

1981, c. 530, § 38.1-939; 1984, c. 640; 1986, c. 562; 2001, c. 706.

Code of Virginia — Title 38.2 (Insurance), Chapter 26 (Home Protection Companies)
§ 38.2-2610. Cancellation of home protection contracts.
A. No home protection contract shall be cancelable by the home protection company during the initial term for which it is issued, except for:

1. Nonpayment of premium;

2. Fraud or misrepresentation of facts material to the issuance of the contract; or

3. Contracts providing coverage prior to the time the residential property is purchased, provided that purchase of the property does not occur.

B. Nothing in this section establishes the right of a contract holder to renew any contract.

1981, c. 530, § 38.1-940; 1986, c. 562.

Code of Virginia — Title 38.2 (Insurance), Chapter 26 (Home Protection Companies)
§ 38.2-2611. Unfair discrimination.
No person shall make or permit any unfair discrimination between individuals in the rates or fees charged for any contract, in the performance of services or payments for services, or in any other terms or conditions of the contract.

1981, c. 530, § 38.1-941; 1986, c. 562.

Code of Virginia — Title 38.2 (Insurance), Chapter 26 (Home Protection Companies)
§ 38.2-2612. Unfair trade practices.
In addition to the provisions of Chapter 5 (§ 38.2-500) of this title, the Commission may order any home protection company or its representatives to cease and desist from engaging in the following unfair trade practices:

1. The making of any false or misleading statements, either oral or written, in connection with the sale, offer to sell, or advertisement of a home protection contract;

2. The omission of any material statement in connection with the sale, offer to sell, or advertisement of a contract that under the circumstances should have been made in order to make the statements that were made not misleading;

3. The making of any statement that the purchase of a home protection contract is mandatory;

4. The making of any false or misleading statements, either oral or written, about the benefits or services available under the contract;

5. The failure to perform the services promised under the contract in a timely, competent, or workmanlike manner; or

6. Any statement or practice which has the effect of creating or maintaining a fraud.

1981, c. 530, § 38.1-942; 1986, c. 562.
Code of Virginia — Title 38.2 (Insurance), Chapter 26 (Home Protection Companies)
§ 38.2-2613. Application of insurance laws.
Except as otherwise specifically provided in this chapter or where the context requires otherwise, all of the provisions of this title that apply to property and casualty insurers shall apply in every respect to home protection companies licensed under this chapter. In addition, Article 1 (§ 58.1-2500 et seq.) and Article 2 (§ 58.1-2520 et seq.) of Chapter 25 of Title 58.1 shall apply to the operation of a home protection company.

1981, c. 530, § 38.1-943; 1986, c. 562; 2006, c. 634; 2017, c. 727.

Code of Virginia — Title 38.2 (Insurance), Chapter 26 (Home Protection Companies)
§ 38.2-2614. Fronting not permitted.
No licensed insurer or licensed home protection company shall act as a fronting company for any unlicensed insurer or unlicensed home protection company.

1981, c. 530, § 38.1-944; 1986, c. 562.

Code of Virginia — Title 38.2 (Insurance), Chapter 26 (Home Protection Companies)
§ 38.2-2615. Other insurance transactions prohibited.
A. A home protection company that engages in any business other than the business of a home protection company is not eligible for the issuance or renewal of a license in this Commonwealth.

B. Nothing in this chapter shall be deemed to authorize any home protection company to transact any business other than that of a home protection company or to transact any other business of insurance, unless the company is authorized by a license issued by the Commission.

1981, c. 530, § 38.1-945; 1986, c. 562; 2006, c. 634; 2017, c. 727.

Code of Virginia — Title 38.2 (Insurance), Chapter 26 (Home Protection Companies)
§ 38.2-2616. Binding arbitration provisions in contract.
Notwithstanding the provisions of § 38.2-312, no home protection company based in this Commonwealth shall be prohibited from including in its contract a provision that requires the contract holder to submit to binding arbitration any dispute between the contract holder and the home protection company.

2003, c. 799.

Code of Virginia — Title 38.2 (Insurance), Chapter 26 (Home Protection Companies)
§ 38.2-2617. Repealed.
Repealed by Acts 2017, c. 727, cl. 2, effective January 1, 2018.

Code of Virginia — Title 38.2 (Insurance), Chapter 26 (Home Protection Companies)
§ 38.2-2628. Repealed.
Repealed by Acts 2015, c. 709, cl. 2.