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2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3370. Service of process upon unauthorized insurer by director

§ 3370. Service of process upon unauthorized insurer by director
(a) Any act of entering into a contract of insurance as an insurer or transacting insurance business in this State as set forth in subsection (b) of section 3368 of this title, by an unauthorized foreign or alien insurer is equivalent to and shall constitute an appointment by such insurer, of the Secretary of State and his or her successor or successors in office, to be its true and lawful attorney upon whom may be served all lawful process in any action or proceeding against it, arising out of a violation of section 3368 of this title, and the commission of any of these acts constitutes an agreement that any such process so served shall be of the same legal force and validity as if served upon the insurer.
(b) Service of such process shall be made by delivering and leaving with the Secretary of State two copies thereof and the payment to the Secretary of State of the fee prescribed by law. The Secretary of State shall forthwith mail by registered mail one of the copies of such process to such insurer at its last known principal place of business, and shall keep a record of all process so served upon him or her. Such process shall be sufficient service upon such insurer provided notice of such service and a copy of the process are, within 14 days thereafter, sent by registered mail or on behalf of the director to such insurer at its last known principal place of business, and such insurer’s receipt and the affidavit of compliance herewith by or on behalf of the director are filed with the clerk of the court in which such action or proceeding is pending on or before the return date of such process or within such further time as the court may allow.
(c)(1) The court in any action or proceeding in which service is made in the manner provided in subsection (b) of this section may, in its discretion, order such postponement as may be necessary to afford such insurer reasonable opportunity to defend such action or proceeding.
(2) Nothing in this section is to be construed to prevent an unauthorized foreign or alien insurer from filing a motion to quash a writ or to set aside service thereof made in the manner provided in subsection (b) of this section on the ground that such unauthorized insurer has not done any of the acts referred to in subsection (a) of this section.
(d) No judgment by default shall be entered in any such action or proceeding until the expiration of 30 days from the date of the filing of the affidavit of compliance.
(e) Nothing in this section contained shall limit or affect the right to serve any process, notice or demand required or permitted by law to be served upon any insurer in any other manner now or hereafter permitted by law. (Added 1967, No. 353 (Adj. Sess.), § 3; amended 2017, No. 11, § 3.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3371. Limits of risk

§ 3371. Limits of risk
(a) No insurer shall retain any risk on any one subject of insurance, whether located or to be performed in this State or elsewhere, in an amount exceeding 10 percent of its surplus to policyholders unless otherwise authorized by the Commissioner.
(b) A “subject of insurance” for the purposes of this section, as to insurance provided for protection against fire, perils, hazards, or causes of loss, other than earthquake and other catastrophic hazards, includes all properties insured by the same insurer which are customarily considered by underwriters to be subject to loss or damage from the same fire or the same occurrence of any other hazard insured against.
(c) Reinsurance ceded as authorized by section 3634a of this title shall be deducted in determining risk retained. As to surety risks, deduction shall also be made of the amount assumed by any licensed or authorized co-surety and the fair market value of any security deposited, pledged, or held subject to the surety’s consent and for the surety’s protection.
(d) As to alien insurers, this section shall relate only to risks and surplus to policyholders of the insurer’s United States branch.
(e) “Surplus to policyholders” for the purposes of this section, in addition to the insurer’s unassigned capital and surplus, shall be deemed to include any voluntary reserves which are not required pursuant to law, and shall be determined from the last sworn statement of the insurer on file with the Commissioner, or by the last report of examination of the insurer, whichever is the more recent at time of assumption of risk.
(f) This section shall not apply to life or health insurance, annuities, title insurance, insurance of wet marine and transportation risks, workers’ compensation insurance, employers’ liability coverages, nor to any policy or type of coverage as to which the maximum possible loss to the insurer is not readily ascertainable on issuance of the policy. (Added 1985, No. 145 (Adj. Sess.), § 1; amended 1993, No. 12, § 1, eff. April 26, 1993.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3381. Legislative purpose and policy

§ 3381. Legislative purpose and policy
The purpose of this article is to subject certain insurers to the jurisdiction of courts of this State by or on behalf of insureds or beneficiaries under insurance contracts. The Legislature declares that it is a subject of concern that many residents of this State hold policies of insurance issued or delivered in this State by insurers while not authorized to do business in this State, thus presenting to such residents the often insuperable obstacle of resorting to distant forums for the purpose of asserting legal rights under such policies. In furtherance of such State interest, the Legislature herein provides a method of substituted service of process upon such insurers and declares that in so doing it exercises its power to protect its residents and to define, for the purpose of this article, what constitutes doing business in this State, and also exercises powers and privileges available to the State by virtue of The McCarran-Ferguson Act, 15 U.S.C. § 1011-1015, which declares that the business of insurance and every person engaged therein shall be subject to the laws of the several states. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 3, § 1).)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3382. Acts which constitute Secretary of State agent for service of process

§ 3382. Acts which constitute Secretary of State agent for service of process
Any of the following acts in this State, effected by mail or otherwise, by an unauthorized foreign or alien insurer:
(1) the issuance or delivery of contracts of insurance to residents of this State or to corporations authorized to do business therein;
(2) the solicitation of applications for such contracts;
(3) the collection of premiums, membership fees, assessments, or other considerations for such contracts; or
(4) any other transaction of insurance business; is equivalent to and shall constitute an appointment by such insurer of the Secretary of State and his or her successor or successors in office, to be its true and lawful attorney, upon whom may be served all lawful process in any action, suit, or proceeding instituted by or on behalf of an insured or beneficiary arising out of any such contract of insurance, and any such act shall be signification of its agreement that such service of process is of the same legal force and validity as personal service of process in this State upon such insurer. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 3, § 2).)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3383. Service upon the Secretary of State notice to defendant

§ 3383. Service upon the Secretary of State notice to defendant
Such service of process shall be made by delivering to and leaving with the Secretary of State or some person in apparent charge of his or her office two copies thereof and the payment to him or her of such fee as is required by 12 V.S.A. § 852. The Secretary of State shall forthwith mail by registered mail one of the copies of such process to the defendant at its last known principal place of business and shall keep a record of all processes so served upon him or her. Such service of process is sufficient, provided notice of such service and a copy of the process are sent within 14 days thereafter by registered mail by plaintiff or plaintiff’s attorney to the defendant at its last known principal place of business, and the defendant’s receipt, or receipt issued by the post office with which the letter is registered, showing the name of the sender of the letter and the name and address of the person to whom the letter is addressed, and the affidavit of the plaintiff or plaintiff’s attorney showing a compliance herewith are filed with the clerk of the court in which such action is pending on or before the date the defendant is required to appear, or within such further time as the court may allow. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 3, § 3); amended 2017, No. 11, § 4.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3384. Service upon other agents; notice to defendant

§ 3384. Service upon other agents; notice to defendant
Service of process in any such action, suit, or proceeding shall in addition to the manner provided in section 3383 of this title be valid if served upon any person within this State who, in this State on behalf of such insurer, is:
(1) soliciting insurance; or
(2) making, issuing, or delivering any contract of insurance; or
(3) collecting or receiving any premium, membership fee, assessment, or other consideration for insurance; and a copy of such process is sent within 14 days thereafter by registered mail by the plaintiff or plaintiff’s attorney to the defendant at the last known principal place of business of the defendant, and the defendant’s receipt, or the receipt issued by the post office with which the letter is registered, showing the name of the sender of the letter and the name and address of the person to whom the letter is addressed, and the affidavit of the plaintiff or plaintiff’s attorney showing a compliance herewith are filed with the clerk of the court in which such action is pending on or before the date the defendant is required to appear, or within such further time as the court may allow. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 3, § 4); amended 2017, No. 11, § 5.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3386. Effect on other modes of service

§ 3386. Effect on other modes of service
Nothing in sections 3382-3384 of this title shall limit or abridge the right to serve any process, notice, or demand upon any insurer in any other manner now or hereafter permitted by law. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 3, § 6).)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3387. Prerequisites to defense of action

§ 3387. Prerequisites to defense of action
Before any unauthorized foreign or alien insurer shall file or cause to be filed any pleading in any action, suit or proceeding instituted against it, such unauthorized insurer shall:
(1) deposit with the clerk of the court in which such action, suit, or proceeding is pending, cash or securities or file with such clerk a bond with good and sufficient sureties, to be approved by the court, in an amount to be fixed by the court sufficient to secure the payment of any final judgment which may be rendered in such action; or
(2) procure a certificate of authority to transact the business of insurance in this State. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 3, § 7).)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3388. Postponements

§ 3388. Postponements
The court in any action, suit, or proceeding, in which service is made in the manner provided in section 3383 or 3384 of this title may, in its discretion, order such postponement as may be necessary to afford the defendant reasonable opportunity to comply with the provisions of section 3387 of this title and to defend such action. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 3, § 8).)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3389. Motion to quash for improper service

§ 3389. Motion to quash for improper service
Nothing in section 3387 of this title is to be construed to prevent an unauthorized foreign or alien insurer from filing a motion to quash a writ or to set aside service thereof made in the manner provided in section 3383 or 3384 of this title on the ground either:
(1) that such unauthorized insurer has not done any of the acts enumerated in section 3382 of this title; or
(2) that the person on whom service was made pursuant to section 3384 of this title was not doing any of the acts therein enumerated. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 3, § 9).)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3390. Attorney’s fees

§ 3390. Attorney’s fees
In any action against an unauthorized foreign or alien insurer upon a contract of insurance issued or delivered in this State to a resident thereof or to a corporation authorized to do business therein, if the insurer has failed for 30 days after demand prior to the commencement of the action to make payment in accordance with the terms of the contract, and the court finds that such refusal was vexatious and without reasonable cause, the court may allow to the plaintiff a reasonable attorney’s fee and include such fee in any judgment that may be rendered in such action. Failure of an insurer to defend any such action shall be deemed prima facie evidence that its failure to make payment was vexatious and without reasonable cause. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 3, § 10).)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3421. Mutualization of stock insurer

§ 3421. Mutualization of stock insurer
(a) A domestic stock insurer may become a mutual insurer under such plan and procedure as may be approved by the Commissioner after a hearing held substantially in accordance with the provisions of section 3305 of this title.
(b) The Commissioner shall not approve any such plan or mutualization unless:
(1) It is equitable to its stockholders and policyholders.
(2) It is subject to approval by the holders of not less than a majority of the insurer’s outstanding capital stock having voting rights present at a duly called regular or special meeting thereof, and by not less than a majority of the insurer’s policyholders who vote on such plan in person, by proxy or by mail pursuant to such notice and procedure as may be approved by the Commissioner.
(3) If a life insurer, the right to vote thereon is limited to holders of policies other than term or group policies, and whose policies have been in force for more than one year.
(4) Mutualization will result in retirement of shares of the insurer’s capital stock at a price not in excess of the fair market value thereof as determined by competent disinterested appraisers.
(5) The plan provides for the purchase of the shares of any nonconsenting stockholder in substantially the same manner and subject to the same rights and conditions as are accorded a dissenting shareholder under section 3428 of this title.
(6) The plan provides for definite conditions to be fulfilled by a designated early date upon which such mutualization will be deemed effective and for notices substantially in accordance with section 3424 of this title.
(7) The mutualization leaves the insurer with surplus funds reasonably adequate for the security of its policyholders and to enable it to continue successfully in business in states in which it is then authorized to transact business, and for the kinds of insurance included in its certificates of authority in such states.
(c) No director, officer, agent, or employee of the insurer, nor any other person, shall receive any fee, commission, or other valuable consideration whatsoever for in any manner aiding, promoting, or assisting therein except as set forth in the plan of mutualization as approved by the Commissioner.
(d) This section shall not apply to mutualization under order of court pursuant to rehabilitation or reorganization of an insurer. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 4, § 1).)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3422. Mutual insurers—Prohibitions

§ 3422. Mutual insurers—Prohibitions
A domestic mutual insurer shall not merge or consolidate with a stock insurer where the surviving corporation will be a stock insurer. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 4, § 2); amended 1993, No. 28, § 1, eff. May 21, 1993.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3426. Effective date of merger or consolidation

§ 3426. Effective date of merger or consolidation
Upon the issuance of a certificate of merger or a certificate of consolidation by the Secretary of State, the merger or consolidation, as the case may be, shall be effected, subject to the rights of dissenting shareholders, members or policyholders, as provided in sections 3428 and 3429 of this title. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 4, § 5).)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3427. Voting

§ 3427. Voting
At any meeting of the shareholders, members, or policyholders, as the case may be, held pursuant to the resolution of the board of directors for the purpose of adopting an agreement of merger or consolidation, as provided for in sections 3424 and 3425 of this title, the shareholders, members, or policyholders, as the case may be, entitled to vote in respect thereof may vote in person or by proxy and shall have such votes as they are entitled to pursuant to the charter and bylaws of the insurer or as may otherwise be provided by law. Two-thirds of the votes cast at the meeting in person or by proxy, shall be necessary for the adoption of such proposed articles of merger or consolidation. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 4, § 6).)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3428. Rights of dissenting shareholders

§ 3428. Rights of dissenting shareholders
(a) If any shareholder of any insurer, a party to a merger or consolidation, who did not vote in favor of such merger or consolidation at the meeting at which the agreement of merger or consolidation was adopted by the shareholders of such insurer shall, at any time within 30 days after the filing of the affidavit of notice of the adoption of the agreement of merger or consolidation as provided for in sections 3424 and 3425 of this title, object thereto in writing and demand payment of the value of his or her shares, the surviving or new insurer shall, in the event that the merger or consolidation shall be made effective, pay to such shareholder upon surrender of his or her certificates therefor, the value of such shares at the effective date of the merger or consolidation. If within 30 days after such effective date, the value of such shares is agreed upon between the shareholder and the surviving or new insurer, as the case may be, payment therefor may be made within 90 days after the effective date. If, within 30 days after such effective date, the surviving or new insurer, as the case may be, and the shareholder do not so agree, either such insurer or the shareholder may, within 90 days after such effective date, petition the Superior Court of the county in which the principal office of the insurer is located, to appraise the value of such shares; and payment of the appraised value thereof shall be made within 60 days after the entry of the judgment or order finding such appraised value. The practice, procedure, and judgment in the Superior Court upon such petition shall be the same, so far as practicable, as that under the eminent domain laws in this State.
(b) Upon the effective date of the merger or consolidation, any shareholder who has made such objection and demand shall cease to be a shareholder and shall have no rights with respect to such shares except the right to receive payment therefor. Every shareholder who did not vote in favor of such merger or consolidation and who does not object in writing and demand payment of the value of his or her shares at the time and in the manner aforesaid, shall be conclusively presumed to have assented to such merger or consolidation. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 4, § 7).)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3429. Rights of dissenting members or policyholders

§ 3429. Rights of dissenting members or policyholders
If not less than five percent of the members or policyholders in a mutual insurer, who did not vote in favor of such merger or consolidation at the meeting at which the agreement of merger or consolidation was adopted by the members or policyholders of such insurer, shall at any time within 30 days after the filing of the affidavit of notice of the adoption of the agreement of merger or consolidation as provided for in sections 3424 and 3425 of this title, file a petition with the Commissioner for a hearing upon the adoption of such agreement of merger or consolidation, the Commissioner shall order a hearing upon said petition and give notice fixing the time and place of such hearing, to the insurers which are parties to the merger or consolidation 15 days before the date of such hearing. The insurer whose policyholders file such petition shall give notice by mail to each member or policyholder of such insurer, at least 10 days before such hearing. At the time and place fixed in such notice, or at the time or times and place or places to which such hearing shall be adjourned, the Commissioner shall proceed with the hearing and make or order such examination into the affairs and condition of each of such insurers as he or she may deem proper. The Commissioner shall have the power to summon and compel the attendance and testimony of witnesses and the production of books and papers before him or her at such hearing. Any member or policyholder, as the case may be, of the insurer so petitioning may appear before the Commissioner and be heard with reference to said contract. If, upon such hearing being had, the Commissioner is not satisfied that the interests of the members or policyholders, as the case may be, of such insurer are properly protected, or if he or she finds that any reasonable objection exists to such contract, he or she shall revoke the approval already given, and the said agreement of merger or consolidation shall thereupon become null and void. The Commissioner shall have like power to revoke any approval of any such agreement of merger or consolidation if any officer, director, or employee of any insurer party to such agreement of merger or consolidation shall, after reasonable notice, fail or refuse to attend and testify at such hearing, or to produce any books or papers called for by said Commissioner. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 4, § 8).)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3431. Merger or consolidation between domestic and foreign insurers—Requirements

§ 3431. Merger or consolidation between domestic and foreign insurers—Requirements
(a) In case of a merger or consolidation between a domestic and a foreign insurer, the articles of merger or consolidation shall be regarded as executed by the proper officers of said foreign insurer when such officers are duly authorized to execute same through such action on the part of the directors, shareholders, members, or policyholders, as the case may be, of said foreign insurer as may be required by the laws of the state where the same is incorporated; and upon execution, the articles of merger or consolidation shall be submitted to the Commissioner of Financial Regulation or other officer at the head of the insurance department of the state where such foreign insurer is incorporated. No such merger or consolidation shall take effect until it shall have been approved by the insurance official of the state where said foreign insurer is incorporated nor until a certificate of his or her approval has been filed with the Commissioner of Financial Regulation for the State of Vermont; provided, that such submission to and approval by the proper official of such other state shall not be required unless the same are required by the laws of such foreign state. Provided, further, that the domestic insurer involved in such merger or consolidation shall not through anything contained in this section be relieved of any of the procedural requirements enumerated in the preceding sections of this subchapter.
(b) No merger, consolidation, or reinsurance between a domestic and a foreign insurer shall take effect, unless and until the surviving, new, or accepting insurer, if such is a foreign insurer, shall file with the Department a power of attorney appointing the Secretary of State and his or her successors in office, the attorney for service of said foreign insurer, upon whom all lawful process against said insurers may be served. Said power of attorney shall be irrevocable so long as said foreign insurer has outstanding in this State any contract of insurance, or other obligation whatsoever, and shall by its terms so provide. Service upon the Secretary of State shall be deemed sufficient service upon the insurer. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 4, § 10); amended 1989, No. 225 (Adj. Sess.), § 25(b); 1995, No. 180 (Adj. Sess.), § 38(a); 2011, No. 78 (Adj. Sess.), § 2, eff. April 2, 2012.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3432. Transfer of deposits

§ 3432. Transfer of deposits
If the state in which a foreign, new, surviving, or accepting insurer is incorporated or organized shall require the maintenance with any official of such state of a deposit of the legal reserve on the policies so assumed and such foreign insurer shall maintain such deposit, then the State Treasurer is authorized to deliver to the proper custodian of such funds in the state in which the said foreign insurer is incorporated or organized, such deposits as he or she may hold pertaining to the policies so assumed by the new, surviving, or accepting insurer. If a surviving, new, or accepting domestic insurer assumes all or a substantial number of the risks of a foreign insurer incorporated in a state which requires the maintenance with a state official of a deposit of the legal reserve on policies so assumed, then the State Treasurer is hereby authorized to receive from such official such deposits as he or she may hold pertaining to the policies so assumed. The amount of deposit to be maintained from time to time for each policy on which liability is assumed shall be at least equal to the amount which would be required in the state where such deposit has theretofore been maintained. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 4, § 11).)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3433. Certificates of fees and commissions paid

§ 3433. Certificates of fees and commissions paid
Whenever articles of merger, consolidation, or reinsurance are filed with the Commissioner, there shall also be filed a certificate, executed by the president or a vice president and attested by the clerk or secretary, and under the corporate seal of each of the insurers parties to the agreement of merger, consolidation, and reinsurance, verified by the affidavits of all such officers, setting forth all fees, commissions, or other compensations, or valuable considerations paid or to be paid, directly or indirectly, to any person or persons, firm or firms, corporation or corporations whomsoever, which in any manner secured, aided, promoted, or assisted in any such merger, consolidation, or reinsurance. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 4, § 12).)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3434. Fees—Penalty for receiving

§ 3434. Fees—Penalty for receiving
(a) No director, officer, or member of any such insurer or insurers except as fully expressed in the affidavits, described in section 3433 of this title, shall receive any fee, commission, other compensation, or valuable consideration whatever, direct or indirect, for in any manner aiding, promoting, or assisting in such merger, consolidation, or reinsurance.
(b) Any person violating the provisions of this section shall be deemed guilty of a misdemeanor, and upon conviction thereof, shall be punished by a fine of not less than $5,000.00 and not more than $15,000.00. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 4, § 13); amended 1995, No. 167 (Adj. Sess.), § 2.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3437. Redomestication; approval as a domestic insurer

§ 3437. Redomestication; approval as a domestic insurer
Any foreign or alien insurer may become a domestic insurer by complying with all of the requirements of law relative to the organization and licensing of a domestic insurer of the same type, and by filing with the Secretary of State its articles of association, charter, or other organization document, together with appropriate amendments thereto adopted in accordance with the laws of this State bringing such articles of association, charter, or other organizational document into compliance with the laws of this State, along with a certificate of general good issued by the Commissioner. Said domestic insurer shall be entitled to the necessary or appropriate certificates and licenses to continue its business and to transact business in this State, and shall be subject to the authority and jurisdiction of this State. In connection with any such redomestication, the Commissioner may waive any and all requirements for public hearings, including those relating to the amendment of an insurer’s articles of association and that required by section 3305 of this title. No insurer redomesticating into this State need merge, consolidate, transfer assets, or otherwise engage in any other reorganization, other than as specified in this section. (Added 1991, No. 41, § 1.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3438. Redomestication; conversion to foreign insurer

§ 3438. Redomestication; conversion to foreign insurer
Any domestic insurer may, upon the approval of and compliance with such conditions as may be imposed by the Commissioner, transfer its domicile, in accordance with the laws thereof, to any other state or jurisdiction, and upon such a transfer shall cease to be a domestic insurer, and its corporate or other legal existence in this State shall cease upon the filing of proof of such redomestication with the Secretary of State and upon payment to the Secretary of State of a filing fee in the amount of $100.00. Such insurer shall be admitted to this State if qualified as a foreign or alien insurer, upon compliance with the qualification requirements for foreign or alien insurers to the extent not waived by the Commissioner. (Added 1991, No. 41, § 2.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3439. Effects of redomestication

§ 3439. Effects of redomestication
Upon redomestication in accordance with section 3437 of this title, the foreign or alien insurer shall become a domestic insurer organized under the laws of this State and have all the rights, privileges, immunities, and powers, and be subject to all applicable laws, duties, and liabilities, of domestic insurers of the same type. Such domestic insurer shall thereupon and thereafter possess all rights that obtained prior to the redomestication to the extent permitted by the laws of this State, and thenceforth be responsible and liable for all the liabilities and obligations that obtained prior to the redomestication. The certificate of authority, agents, appointments and licenses, rates, and other items that the Commissioner of insurance allows, in his or her discretion, which are in existence at the time any insurer licensed to transact the business of insurance in this State transfers its corporate domicile to this or any other state or jurisdiction by redomestication, shall continue in full force and effect upon such transfer if such insurer remains duly qualified to transact the business of insurance in this State. All transferring insurers qualified in this State shall notify the Commissioner of the transfer of domicile and shall provide the Commissioner such information and documentation as the Commissioner may request. All outstanding policies of any transferring insurer shall remain in full force and effect. (Added 1991, No. 41, § 3.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3440. Redomestication; fees

§ 3440. Redomestication; fees
An insurer becoming a domestic insurer through the redomestication procedure specified in section 3437 of this title shall pay to the Commissioner such fees as would be payable by a like domestic insurer organizing and becoming licensed or transacting business in this State. An insurer becoming a domestic insurer pursuant to section 3437 shall pay to the Secretary of State a filing fee in the amount of $300.00 for the filing required under section 3437. (Added 1991, No. 41, § 4.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3443. Regulated as an insurance company

§ 3443. Regulated as an insurance company
(a) A stock insurance company resulting from the reorganization of a domestic mutual insurance company shall be regulated as a stock insurance company under this title and shall have all the rights, privileges, immunities, and powers of the former mutual insurance company and shall be subject to all the duties and liabilities of an insurer organized under this title.
(b) The Commissioner shall retain jurisdiction over a mutual insurance holding company and any stock insurance holding company to assure that policyholder interests are protected. A mutual insurance holding company and any stock insurance holding company are deemed to be insurers subject to chapter 145 of this title. A mutual insurance holding company and any stock insurance holding company shall automatically be a party to any proceeding under chapter 145 of this title involving a stock insurance company reorganized under this subchapter. In any proceeding under chapter 145 of this title involving a reorganized stock insurance company, the assets of the mutual insurance holding company and any stock insurance holding company are deemed to be assets of the estate of the reorganized insurance company for purposes of satisfying the claims of the reorganized insurance company’s policyholders. A mutual insurance holding company shall not dissolve or liquidate without the approval of the Commissioner or as ordered by the Superior Court pursuant to chapter 145 of this title. The Commissioner shall have jurisdiction over a stock insurance holding company as if it were a mutual insurance holding company.
(c) Acquisitions and investments by mutual insurance holding companies, including those acquisitions pursuant to subsection 3442(b) of this title, shall be subject to the procedures and standards prescribed by chapter 101, subchapter 13 of this title. Mutual insurance holding companies and stock insurance holding companies shall be considered a domestic insurer for purposes of such acquisition. (Added 1995, No. 167 (Adj. Sess.), § 29a; amended 1999, No. 86 (Adj. Sess.), § 5, eff. April 27, 2000.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3444. Demutualization of a mutual insurance holding company

§ 3444. Demutualization of a mutual insurance holding company
(a) Sections 3422 and 3423 of this title are not applicable to a reorganization or merger pursuant to section 3441 or 3442 of this title.
(b) Sections 3422 and 3423 of this title are applicable to the demutualization of a mutual insurance holding company that resulted from the reorganization of a domestic mutual insurance company pursuant to section 3441 as if it were a mutual insurance company. (Added 1995, No. 167 (Adj. Sess.), § 29a.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3445. Membership interest not a security

§ 3445. Membership interest not a security
A membership interest in a domestic mutual insurance holding company shall not constitute a security as defined by 9 V.S.A. § 4202a. (Added 1995, No. 167 (Adj. Sess.), § 29a.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3446. Filing of amended charters

§ 3446. Filing of amended charters
Upon the consummation of a reorganization or merger pursuant to this subchapter, duplicate originals of amended and restated charter documents adopted by the mutual holding company and the insurance company shall be filed in the office of the Secretary of State, and shall take effect as of the date of the filing of such originals in such office. (Added 1995, No. 167 (Adj. Sess.), § 29a.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3461a. General limitations and diversification requirements for property and casualty, financial guaranty and mortgage guaranty insurers

§ 3461a. General limitations and diversification requirements for property and casualty, financial guaranty and mortgage guaranty insurers
(a) General five percent diversification.
(1) Except as otherwise specified in this subchapter, a domestic property and casualty, financial guaranty or mortgage guaranty insurer shall not acquire directly or indirectly through an investment subsidiary an investment under this subchapter if, as a result of and after giving effect to the investment, the insurer would hold more than five percent of its admitted assets in investments of all kinds issued, assumed, accepted, insured, or guaranteed by a single person.
(2) This five percent limitation shall not apply to the aggregate amounts insured by a single financial guaranty insurer with the highest generic rating issued by a nationally recognized statistical rating organization.
(3) Asset-backed securities shall not be subject to the limitations of subdivision (1) of this subsection; however, an insurer shall not acquire an asset-backed security if, as a result of and after giving effect to the investment, the aggregate amount of asset-backed securities secured by or evidencing an interest in a single asset or single pool of assets held by a trust or other business entity then held by the insurer would exceed five percent of its admitted assets.
(b) An insurer subject to this section shall comply with applicable regulations addressing investments in lower and medium grade obligations.
(c) Canadian investments.
(1) An insurer subject to this section shall not acquire, directly or indirectly through an investment subsidiary, any Canadian investments authorized by this subchapter, if, as a result of and after giving effect to the investment, the aggregate amount of these investments then held by the insurer would exceed 40 percent of its admitted assets or if the aggregate amount of Canadian investments not acquired under subdivision 3461c(2) of this subchapter then held by the insurer would exceed 25 percent of its admitted assets.
(2) However, as to an insurer that is authorized to do business in Canada or that has outstanding insurance, annuity or reinsurance contracts on lives or risks resident or located in Canada and denominated in Canadian currency, the limitations of subdivision (1) of this subsection shall be increased by the greater of:
(A) the amount the insurer is required by Canadian law to invest in Canada or to be denominated in Canadian currency; or
(B) 125 percent of the amount of its reserves and other obligations under contracts on risks resident or located in Canada. (Added 1999, No. 84 (Adj. Sess.), § 2, eff. April 19, 2000.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3461b. General limitations and diversification requirements for life and health insurers

§ 3461b. General limitations and diversification requirements for life and health insurers
(a) General three percent diversification.
(1) Except as otherwise specified in this subchapter, a domestic life and health insurer shall not acquire, directly or indirectly through an investment subsidiary, an investment under this subchapter if, as a result of and after giving effect to the investment, the insurer would hold more than three percent of its admitted assets in investments of all kinds issued, assumed, accepted, insured or guaranteed by a single person.
(2) This three percent limitation shall not apply to the aggregate amounts insured by a single financial guaranty insurer with the highest generic rating issued by a nationally-recognized statistical rating organization.
(3) Asset-backed securities shall not be subject to the limitations of subdivision (1) of this subsection; however, an insurer shall not acquire an asset-backed security if, as a result of and after giving effect to the investment, the aggregate amount of asset-backed securities secured by or evidencing an interest in a single asset or single pool of assets held by a trust or other business entity then held by the insurer would exceed three percent of its admitted assets.
(b) An insurer subject to this section shall comply with applicable regulations addressing investments in lower and medium grade obligations.
(c) Canadian investments.
(1) An insurer subject to this section shall not acquire, directly or indirectly through an investment subsidiary, a Canadian investment authorized by this subchapter if, as a result of and after giving effect to the investment, the aggregate amount of these investments then held by the insurer would exceed 40 percent of its admitted assets or if the aggregate amount of Canadian investments not acquired under subdivision 3461c(2) of this title then held by the insurer would exceed 25 percent of its admitted assets.
(2) However, as to an insurer that is authorized to do business in Canada or that has outstanding insurance, annuity or reinsurance contracts on lives or risks resident or located in Canada and denominated in Canadian currency, the limitations of subdivision (1) of this subsection shall be increased by the greater of:
(A) the amount the insurer is required by Canadian law to invest in Canada or to be denominated in Canadian currency; or
(B) 115 percent of the amount of its reserves and other obligations under contracts on lives or risks resident or located in Canada. (Added 1999, No. 84 (Adj. Sess.), § 3, eff. April 19, 2000.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3461d. Registration or filing exemption

§ 3461d. Registration or filing exemption
Notwithstanding the provisions of any other section of subchapter 4 of this chapter, an insurer shall not be required to register or file with the SVO any security that meets and continues to meet the conditions for exemption for certain nationally recognized statistical rating organization rated securities consistent with the Purposes and Procedures Manual of the NAIC Investment Analysis Office or any successor publication. (Added 1999, No. 84 (Adj. Sess.), § 5, eff. Jan. 1, 2000; amended 2017, No. 134 (Adj. Sess.), § 4.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3462. Investments—Foreign insurers

§ 3462. Investments—Foreign insurers
The investments of a foreign or alien insurer shall be as permitted by the laws of its domicile if of a quality substantially as high as that required under this chapter for similar funds of like domestic insurers. (1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 5, art. 2).)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3463a. Valuation of investments

§ 3463a. Valuation of investments
Investments of domestic insurers shall be valued in accordance with the valuation procedures established by the National Association of Insurance Commissioners, unless the Commissioner requires or finds another method of valuation that is not inconsistent with the valuation method promulgated by the National Association of Insurance Commissioners and is reasonable under the circumstances. (Added 1991, No. 101, § 3; amended 1993, No. 12, § 11, eff. April 26, 1993.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 101 - Insurance Companies Generally › § 3465. Exemption from investment limitations

§ 3465. Exemption from investment limitations
(a) Nothing in this chapter or other statute law of the State shall be construed as denying to an insurer the right to invest its funds, operate a business, manage or deal in property, or take any other action over whatever period of time may be reasonably necessary to avoid loss on a loan or investment previously made or an obligation created in good faith, the conditions and limitations of the investment of funds in this chapter to the contrary notwithstanding.
(b) No investment limitation contained in this chapter shall prohibit an insurer from investing in or acquiring securities or other properties of another insurance company in connection with a lawful agreement of bulk reinsurance, merger, consolidation, sale of assets, or acquisition of a subsidiary under subchapter 13 of this chapter.
(c) No investment limitation contained in this chapter shall prohibit the acquisition and retention by an insurer of substitute or additional securities or property if:
(1) received as a dividend;
(2) a lawful distribution of assets;
(3) through the exercise of rights of conversion, warrants, or rights to purchase stock or preemptive rights to subscribe to stock, contained in or attached to a previously existing investment in such company;
(4) pursuant to a lawful plan of reorganization. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 5, art. 3, § 1); amended 2003, No. 163 (Adj. Sess.), § 44, eff. June 10, 2004.)