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2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 137 - Vermont Joint Underwriting Associations › § 4987. Annual statements

§ 4987. Annual statements
Each association shall adopt a fiscal year beginning on October 1 and shall file in the office of the Commissioner on or before the 15th day of November each year, or such other month specified in the plan, a statement as prescribed by the Commissioner. The statement shall contain matters and information required by the Commissioner including information with respect to its transactions, condition, operations, and affairs during the preceding year, and shall be in a form approved by the Commissioner. The Commissioner may, at any time, require an association to furnish additional information with respect to matters considered to be material to the scope, operation, and experience of the association. (Added 1985, No. 265 (Adj. Sess.), § 4, eff. June 4, 1986.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 137 - Vermont Joint Underwriting Associations › § 4988. Examination

§ 4988. Examination
The Commissioner shall make an examination into the affairs of each association annually or as often as he or she deems necessary. The Commissioner shall make an order indicating the scope of the examination and may appoint as examiners one or more competent persons not employed by any insurer or interested in any insurer except as a policyholder. The expenses of every such examination shall be borne and paid for by the association involved. (Added 1985, No. 265 (Adj. Sess.), § 4, eff. June 4, 1986.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 137 - Vermont Joint Underwriting Associations › § 4989. Immunity

§ 4989. Immunity
Any association, the Commissioner, or any other person or organization shall be immune from civil liability for any actions taken or statements made in good faith by any of them in any report, communication, or actions concerning risks insured or to be insured by the association or during any proceedings in connection therewith. Any reports and communications in connection therewith are not subject to public inspection. (Added 1985, No. 265 (Adj. Sess.), § 4, eff. June 4, 1986.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 137 - Vermont Joint Underwriting Associations › § 4990. Rules; enforcement

§ 4990. Rules; enforcement
The Commissioner may adopt reasonable rules to carry out the purposes of this chapter and may suspend or revoke, after reasonable notice and a hearing, the certificate of authority or license to transact the business of insurance in this State of any member or other person that fails to comply with the provisions of this chapter, rules adopted hereunder, or any plan. (Added 1985, No. 265 (Adj. Sess.), § 4, eff. June 4, 1986; amended 2015, No. 23, § 84.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 137 - Vermont Joint Underwriting Associations › § 4991. Appeal

§ 4991. Appeal
Any member or other person aggrieved by any action or decision of an association, or of any member as a result of its participation therein, may appeal to the board of directors. The decision of the board of directors may be appealed to the Commissioner within 30 days from the date of its decision. The Commissioner shall, after hearing held upon notice, issue an order approving or disapproving the board of directors’ decision. All final orders and decisions of the Commissioner are subject to judicial review as provided in 3 V.S.A. § 815. (Added 1985, No. 265 (Adj. Sess.), § 4, eff. June 4, 1986.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 137 - Vermont Joint Underwriting Associations › § 4992. Termination

§ 4992. Termination
The authority granted to the Commissioner to establish a joint underwriting association under this chapter shall continue indefinitely unless the authority is terminated by act of the General Assembly. In the event authority is so terminated, any association established prior to the termination date may continue to exist for a period of one year from the date it commences underwriting activities. All obligations incurred by the association or by policyholders during this period shall be honored and binding until discharged, and any association shall remain in effect for the purpose of discharging any obligations incurred. The plan of operation shall provide for the orderly dissolution of the association at its termination. Upon termination of the association and the discharge of all its liabilities and at any such other time as may be specified in the plan, any excess funds of the association shall be distributed to the policyholders of the association in an equitable manner as set forth in the plan of operation. (Added 1985, No. 265 (Adj. Sess.), § 4, eff. June 4, 1986; amended 1987, No. 20; 1987, No. 185 (Adj. Sess.), § 7, eff. May 5, 1988; 1989, No. 113, § 3.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 138 - Non-Admitted Insurers and Surplus Lines Insurance › § 5022. Definitions

§ 5022. Definitions
(a) Notwithstanding subsection (b) of this section, as used in this chapter, unless the context requires otherwise, words and phrases shall have the meaning given under Title V, Subtitle B of the Dodd-Frank Wall Street Reform and Consumer Protection Act, Pub. L. No. 111-203, as amended.
(b) As used in this chapter:
(1) “Admitted insurer” means an insurer licensed to transact business in this State. For purposes of this chapter, “admitted insurer” shall not include a domestic surplus lines insurer.
(2) “Commissioner” means the Commissioner of Financial Regulation.
(3) “Domestic insurer” means any insurer that has been chartered by, incorporated, organized, or constituted within or under the laws of this State.
(4) “Domestic risk” means a subject of insurance that is resident, located, or to be performed in this State.
(5) “Domestic surplus lines insurer” means a domestic insurer with which insurance coverage may be placed under this chapter.
(6) “To export” means to place surplus lines insurance with a non-admitted insurer.
(7) “Home state” means, with respect to an insured:
(A)(i) The state in which an insured maintains its principal place of business or, in the case of an individual, the individual’s principal residence; or
(ii) if 100 percent of the insured risk is located outside the state referred to in subdivision (A)(i) of this subsection, the state to which the greatest percentage of the insured’s taxable premium for that insurance contract is allocated.
(B) If more than one insured from an affiliated group are named insureds on a single non-admitted insurance contract, the term “home state” means the home state, as determined pursuant to subdivision (A) of this subdivision (7), of the member of the affiliated group that has the largest percentage of premium attributed to it under such insurance contract.
(8) “NAIC” means the National Association of Insurance Commissioners.
(9) “Surplus lines broker” means an individual licensed under this chapter and chapter 131 of this title.
(10) “Surplus lines insurance” means coverage not procurable from admitted insurers.
(11) “Surplus lines insurer” means a non-admitted insurer with which insurance coverage may be placed under this chapter. (Added 1979, No. 50, § 2; amended 1979, No. 197 (Adj. Sess.), § 1; 1989, No. 225 (Adj. Sess.), § 25(b); 1995, No. 180 (Adj. Sess.), § 38(a); 2011, No. 49, § 2, eff. May 26, 2011; 2011, No. 78 (Adj. Sess.), § 2, eff. April 2, 2012; 2019, No. 57, § 4.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 138 - Non-Admitted Insurers and Surplus Lines Insurance › § 5023. Surplus lines insurance; authorized

§ 5023. Surplus lines insurance; authorized
Surplus lines insurance may be procured from non-admitted insurers, if:
(1) the insurance meets the conditions specified in section 5024 of this title;
(2) the insurance is placed through a licensed surplus lines broker;
(3) the insurer meets the conditions specified in section 5026 of this title; and
(4) all other requirements of this chapter are met. (Added 1979, No. 50, § 2; amended 1979, No. 197 (Adj. Sess.), § 2; 2001, No. 97 (Adj. Sess.), § 19.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 138 - Non-Admitted Insurers and Surplus Lines Insurance › § 5023a. Domestic surplus lines insurer; authorized

§ 5023a. Domestic surplus lines insurer; authorized
(a) Surplus lines insurance may be procured from a domestic surplus lines insurer if all of the following criteria are met:
(1) The board of directors of the insurer has adopted a resolution seeking certification as a domestic surplus lines insurer and the Commissioner has approved such certification.
(2) The insurer is already eligible to offer surplus lines insurance in at least one other state besides Vermont.
(3) The insurer meets the requirements of section 5026 of this title.
(4) All other requirements of this chapter are met.
(b) The requirements of 8 V.S.A. § 80 shall not apply to domestic surplus lines insurers. A domestic surplus lines insurer shall be deemed to be a non-admitted insurer for purposes of chapter 138 of this title. (Added 2019, No. 57, § 5.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 138 - Non-Admitted Insurers and Surplus Lines Insurance › § 5024. Conditions for placement of insurance

§ 5024. Conditions for placement of insurance
(a) Insurance coverage, except as described in section 5025 of this chapter, shall not be placed with a surplus lines insurer unless the full amount of insurance required is not reasonably procurable from admitted insurers actually transacting that kind and class of insurance in this State; and the amount of insurance exported shall be only the excess over the amount procurable from admitted insurers actually transacting and insuring that kind and class of insurance.
(b) Notwithstanding any other provision of this section, the Commissioner may order eligible for export any class or classes of insurance coverage or risk for which he or she finds there to be an inadequate competitive market among admitted insurers either as to acceptance of the risk, contract terms, or premium or premium rate.
(c) The due diligence search for reasonably procurable insurance coverage required under subsection (a) of this section is not required for an exempt commercial purchaser, provided:
(1) the surplus lines broker procuring or placing the surplus lines insurance has disclosed to the exempt commercial purchaser that such insurance may be available from an admitted insurer and may provide greater protection with more regulatory oversight; and
(2) the exempt commercial purchaser has subsequently requested in writing the surplus lines broker to procure or place such insurance from a non-admitted insurer. (Added 1979, No. 50, § 2; amended 1979, No. 197 (Adj. Sess.), § 3; 2001, No. 97 (Adj. Sess.), § 19; 2011, No. 49, § 3, eff. May 26, 2011; 2019, No. 57, § 6.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 138 - Non-Admitted Insurers and Surplus Lines Insurance › § 5025. Exceptions concerning placement of insurance with non-admitted insurers; records

§ 5025. Exceptions concerning placement of insurance with non-admitted insurers; records
The provisions of this chapter controlling the placement of insurance with non-admitted insurers shall not apply to life insurance, health insurance, annuities, or reinsurance, nor to the following insurance when so placed by any licensed producer in this State:
(1) insurance on subjects whose home state is other than Vermont;
(2) insurance on the property or operations of aircraft or railroads engaged in transportation in interstate and foreign commerce; or
(3) insurance of vessels, crafts or hulls, cargoes, marine builder’s risks, marine protection and indemnity, or other risks, including strikes and war risks commonly insured under ocean or wet marine forms of policy. (Added 1979, No. 50, § 2; amended 2001, No. 97 (Adj. Sess.), § 19; 2011, No. 49, § 4, eff. May 26, 2011.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 138 - Non-Admitted Insurers and Surplus Lines Insurance › § 5026. Solvent insurers required

§ 5026. Solvent insurers required
(a) Where Vermont is the home state of the insured, surplus lines brokers shall not knowingly place or continue surplus lines insurance with surplus lines insurers who are insolvent or unsound financially, and in no event shall any surplus lines broker place any insurance with a non-admitted insurer unless such insurer:
(1) has and maintains capital and surplus or its equivalent under the laws of its domiciliary jurisdiction that equals the greater of:
(A) the minimum capital and surplus requirements under the law of this State; or
(B) $15,000,000.00; and
(2) if an alien insurer is listed on the quarterly listing of alien insurers maintained by the NAIC international insurers department.
(b) Notwithstanding the capital and surplus requirements of this section, a surplus lines insurer may receive approval upon an affirmative finding of acceptability by the Commissioner. The finding shall be based upon such factors as quality of management, capital, and surplus of any parent company, company underwriting profit and investment-income trends, market availability, and company record and reputation within the industry. In no event, however, shall the Commissioner make an affirmative finding of acceptability when the surplus lines insurer’s capital and surplus is less than $4,500,000.00.
(c) The Commissioner may from time to time publish a list of all non-admitted insurers deemed by him or her to be currently eligible surplus lines insurers under the provisions of this section, and shall mail a copy of such list to each surplus lines broker. This subsection shall not be deemed to cast upon the Commissioner the duty of determining the actual financial condition or claims practices of any non-admitted insurer; and the status of eligibility, if granted by the Commissioner, shall indicate only that the insurer appears to be sound financially and to have satisfactory claims practices, and that the Commissioner has no credible evidence to the contrary. While any such list is in effect, the surplus lines broker shall restrict to the insurers so listed all surplus lines insurance business placed by him or her. However, upon the request of a surplus lines broker or an insured, the Commissioner may deem a non-admitted insurer to be an eligible surplus lines insurer for purposes of this subsection prior to publication of the name of such surplus lines insurer on the list. (Added 1979, No. 50, § 2; amended 1979, No. 197 (Adj. Sess.), § 4; 1985, No. 236 (Adj. Sess.), § 4, eff. June 3, 1986; 1989, No. 249 (Adj. Sess.), § 1; 1993, No. 235 (Adj. Sess.), § 5, eff. June 21, 1994; 2001, No. 97 (Adj. Sess.), § 19; 2007, No. 49, § 7; 2011, No. 49, § 5, eff. May 26, 2011; 2019, No. 57, § 7.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 138 - Non-Admitted Insurers and Surplus Lines Insurance › § 5027. Evidence of the insurance; changes; penalty

§ 5027. Evidence of the insurance; changes; penalty
(a) Where Vermont is the home state of the insured, the surplus lines broker, upon placing a domestic risk with a surplus lines insurer, shall promptly deliver to the insured the policy issued by the surplus lines insurer, or if such policy is not then available, a certificate, cover note, or other confirmation of insurance, showing the description and location of the subject of the insurance, coverage, conditions and term of the insurance, the premium and rate charged and taxes collected from the insured, and the name and address of the insured and surplus lines insurer. If the risk is assumed by more than one insurer, the document or documents shall state the name and address and proportion of the entire risk assumed by each insurer.
(b) No surplus lines broker shall issue or deliver such policy or such confirmation of insurance or represent that insurance will be or has been written by any non-admitted surplus lines insurer unless he or she has written authority from the surplus lines insurer to assume the risk or has received confirmation from the surplus lines insurer in the regular course of business that such insurance has been granted.
(c) If, after delivery of any such document, there is any change in the identity of the insurers, the proportion of the risk assumed by any insurer, or any other material change in coverage evidenced by an appropriate document, the surplus lines broker shall promptly deliver to the insured an appropriate substitute for, or endorsement of the original document, accurately showing the current status of the coverage and the insurers responsible thereunder. The document as modified and issued must conform to all the requirements of this chapter, and any such change resulting in a violation of this chapter is prohibited.
(d) As soon as reasonably possible, and in no event later than 60 days after placement of any such insurance, the surplus lines broker shall procure from the insurer a full and properly executed policy and deliver it to the insured to replace any confirmation previously issued. The word “policy,” as used in this section, shall include a certificate of insurance or cover note bound under a fully executed and effective contract from a bona fide intermediary or general agent for a surplus lines insurer, provided that it contains or has attached to it all insuring agreements, clauses, conditions, endorsements, exclusions, or any other material provisions that would regularly be included in such a policy.
(e) Any surplus lines broker who fails to comply with the requirements of this section shall be subject to the penalties provided in this chapter. (Added 1979, No. 50, § 2; amended 1979, No. 197 (Adj. Sess.), § 5; 2001, No. 97 (Adj. Sess.), § 19; 2011, No. 49, § 6, eff. May 26, 2011.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 138 - Non-Admitted Insurers and Surplus Lines Insurance › § 5028. Information required on contract

§ 5028. Information required on contract
Where Vermont is the home state of the insured, each surplus lines broker through whom a surplus lines insurance coverage is procured shall endorse on the outside of the policy and on any confirmation of the insurance, his or her name, address and license number, and the name and address of the producer, if any, through whom the business originated. Where such coverage is placed with an eligible surplus lines insurer there shall be stamped or written conspicuously in no smaller than 10-point boldface type of a contrasting color upon the first page of the policy and the confirmation of insurance, if any, “The company issuing this policy is a surplus lines insurer and the rates charged have not been approved by the Commissioner of Financial Regulation. Any default on the part of the insurer is not covered by the Vermont Insurance Guaranty Association.” (Added 1979, No. 50, § 2; amended 1979, No. 197 (Adj. Sess.), § 6; 2001, No. 97 (Adj. Sess.), § 19; 2011, No. 49, § 7, eff. May 26, 2011; 2019, No. 57, § 9.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 138 - Non-Admitted Insurers and Surplus Lines Insurance › § 5029. Surplus lines insurance valid

§ 5029. Surplus lines insurance valid
(a) Insurance contracts procured as surplus lines insurance from surplus lines insurers in accordance with this chapter shall be valid and enforceable to the same extent as insurance contracts procured from admitted insurers.
(b) The insurance trade practices provisions of sections 4723 and 4724(1)-(7) and (9)-(18) of this title, and the cancellation provisions of sections 3879-3883 (regarding fire and casualty policies) and 4711-4715 (regarding commercial risk policies) of this title shall apply to surplus lines insurers, both domestic and foreign.
(c) Other provisions of this title not specifically applicable to surplus lines insurers shall not apply. (Added 1979, No. 50, § 2; amended 1979, No. 197 (Adj. Sess.), § 7; 2019, No. 57, § 10.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 138 - Non-Admitted Insurers and Surplus Lines Insurance › § 5030. Liability of surplus lines insurer for losses and unearned premiums

§ 5030. Liability of surplus lines insurer for losses and unearned premiums
If a surplus lines insurer has assumed a surplus lines coverage through the intervention of a licensed surplus lines broker of this State, and if the premium for that coverage has been received by that broker, then in all questions thereafter arising under the coverage as between the insurer and the insured, the insurer shall be deemed to have received that premium and the insurer shall be liable to the insured for losses covered by such insurance and for any return premiums due on that insurance to the insured whether or not the broker is indebted to the insurer for such insurance or for any other cause. (Added 1979, No. 50, § 2; amended 2019, No. 57, § 11.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 138 - Non-Admitted Insurers and Surplus Lines Insurance › § 5031. Licensing of surplus lines brokers

§ 5031. Licensing of surplus lines brokers
After written application on a form supplied by the Commissioner, any licensed producer who is deemed by the Commissioner to be trustworthy and competent may be licensed as a surplus lines broker, pursuant to the provisions of chapter 131 of this title. (Added 1979, No. 50, § 2; amended 1979, No. 197 (Adj. Sess.), § 8; 1981, No. 42, § 3; 2001, No. 97 (Adj. Sess.), § 19.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 138 - Non-Admitted Insurers and Surplus Lines Insurance › § 5032. Surplus lines broker may accept business from other producers

§ 5032. Surplus lines broker may accept business from other producers
(a) A licensed surplus lines broker may originate surplus lines business himself or herself or may accept such business from any other originating producer duly licensed as to the kind or kinds of insurance involved and may compensate such producer therefor.
(b) No originating producer shall knowingly misrepresent to the surplus lines broker any material fact involved in any such insurance transaction or in the eligibility of the risk for placement with a surplus lines broker. (Added 1979, No. 50, § 2; amended 1979, No. 197 (Adj. Sess.), § 9; 2001, No. 97 (Adj. Sess.), § 19.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 138 - Non-Admitted Insurers and Surplus Lines Insurance › § 5033. Records of surplus lines broker

§ 5033. Records of surplus lines broker
(a) Where Vermont is the home state of the insured, each surplus lines broker shall keep in his or her office a full and true record of each surplus lines insurance contract covering a domestic risk placed by or through him or her with a surplus lines insurer, including a copy of the daily report, if any, and showing such of the following items as may be applicable:
(1) amount of the insurance and perils insured;
(2) brief description of property insured and its locations;
(3) gross premium charged;
(4) any return premium paid;
(5) rate of premium charged upon the several items of property;
(6) effective date of the contract and its terms;
(7) name and post office address of the insured;
(8) name and post office address of the insurer;
(9) name and post office address of brokerage house, if applicable, and name of licensed individual producer with whom business was placed;
(10) amount collected from the insured; and
(11) other information as may be required by the Commissioner.
(b) The record of each contract shall be kept open to examination by the Commissioner without notice until three years next following termination of the contract. (Added 1979, No. 50, § 2; amended 1979, No. 197 (Adj. Sess.), § 10; 2001, No. 97 (Adj. Sess.), § 19; 2011, No. 49, § 8, eff. May 26, 2011.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 138 - Non-Admitted Insurers and Surplus Lines Insurance › § 5034. Quarterly reports; summary of exported business

§ 5034. Quarterly reports; summary of exported business
On or before the end of each month next following each calendar quarter, each surplus lines broker shall file with the Commissioner of Taxes, on forms prescribed by him or her, a verified report of all surplus lines insurance transacted during the preceding calendar quarter. (Added 1979, No. 50, § 2; amended 2001, No. 97 (Adj. Sess.), § 19; 2019, No. 51, § 36, eff. June 10, 2019.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 138 - Non-Admitted Insurers and Surplus Lines Insurance › § 5035. Surplus lines tax

§ 5035. Surplus lines tax
(a) Where Vermont is the home state of the insured, gross premiums charged, less any return premiums, for surplus lines coverages placed with surplus lines insurers are subject to a premium receipts tax of three percent, which shall be collected from the insured by the surplus lines broker at the time of delivery of policy or other confirmation of insurance, in addition to the full amount of the gross premium charged by the insurer for the insurance. The tax on any portion of the premium unearned at termination of insurance shall be returned to the policyholder by the surplus lines broker. Nothing contained in this section will preclude a surplus lines broker from charging a fee to the purchaser of the contract sufficient to recover the amount of this tax.
(b) At the time of filing his or her quarterly report with the Commissioner of Taxes, each surplus lines broker shall remit the premium tax due thereon to the Commissioner of Taxes.
(c) The Commissioner of Taxes shall collect the tax imposed by this section. All administrative provisions of 32 V.S.A. chapter 151, including those relating to the collection and enforcement of the income tax by the Commissioner of Taxes, shall apply to this section. (Added 1979, No. 50, § 2; amended 1981, No. 42, § 4; 2001, No. 97 (Adj. Sess.), § 19; 2011, No. 49, § 9, eff. May 26, 2011; 2019, No. 51, § 37, eff. June 10, 2019; 2019, No. 57, § 12.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 138 - Non-Admitted Insurers and Surplus Lines Insurance › § 5036. Direct placement of insurance

§ 5036. Direct placement of insurance
(a) Every insured and every self-insurer in this State for whom this is their home state who procures or causes to be procured or continues or renews insurance from any non-admitted insurer, covering a subject located or to be performed within this State, other than insurance procured through a surplus lines broker pursuant to this chapter, shall, before March 1 of the year after the year in which the insurance was procured, continued or renewed, file a written report with the Commissioner of Taxes on forms prescribed and furnished by the Commissioner of Taxes. The report shall show:
(1) the name and address of the insured or insureds;
(2) the name and address of the insurer or insurers;
(3) the subject of the insurance;
(4) a general description of the coverage;
(5) the amount of premium currently charged for it;
(6) such additional pertinent information as may be reasonably requested by the Commissioner of Taxes.
(b) Any insurance, where this State is the home state of the insured, or for which premium in whole or in part is remitted directly or indirectly from within this State, shall be deemed insurance subject to subsection (a) of this section.
(c) A tax at the rate of three percent of the gross amount of premium, less any return premium, shall be levied upon an insured who procures insurance subject to subsection (a) of this section. Before March 1 of the year after the year in which the insurance was procured, continued, or renewed, the insured shall remit to the Commissioner of Taxes the amount of the tax.
(d) All administrative provisions of 32 V.S.A. chapter 151, including those relating to the collection and enforcement of the income tax by the Commissioner of Taxes, shall apply to this section. (Added 1979, No. 50, § 2; amended 1979, No. 197 (Adj. Sess.), § 11; 2011, No. 49, § 10, eff. May 26, 2011; 2019, No. 51, § 38, eff. June 10, 2019; 2019, No. 57, § 13.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 138 - Non-Admitted Insurers and Surplus Lines Insurance › § 5037. Suspension, revocation, or refusal of surplus lines broker’s license

§ 5037. Suspension, revocation, or refusal of surplus lines broker’s license
The Commissioner may suspend, revoke, or refuse to renew the license of a surplus lines broker after notice and hearing as provided under 3 V.S.A. chapter 25, upon any one or more of the following grounds:
(1) failure to make accounts and records relating to domestic risks from this State available to the Commissioner during the period when such accounts and records are required to be maintained under section 5033 of this title;
(2) closing of the surplus lines broker’s office for a period of more than 30 consecutive days, unless permission is granted by the Commissioner;
(3) failure to make and file required quarterly reports;
(4) failure to transmit required tax on surplus lines premiums;
(5) suspension, revocation, or refusal to renew any other license issued by the Commissioner;
(6) lack of qualifications as for an original surplus lines broker’s license;
(7) material violation of any provision of this chapter; or
(8) for any other cause for which a license could be denied, revoked, suspended, or renewal refused under section 4804 of this title. (Added 1979, No. 50, § 2; amended 1979, No. 197 (Adj. Sess.), § 12; 2001, No. 97 (Adj. Sess.), § 19; 2011, No. 49, § 11, eff. May 26, 2011.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 138 - Non-Admitted Insurers and Surplus Lines Insurance › § 5038. Actions against insurer; service of process

§ 5038. Actions against insurer; service of process
(a) A non-admitted insurer may be sued upon any cause of action arising in this State under any surplus lines insurance contract made by it or certificate, cover note, or other confirmation of such insurance issued or delivered by the surplus lines broker pursuant to the procedure provided in chapter 101, subchapter 2 of this title.
(b) Each surplus lines insurer that assumes a surplus lines coverage shall be deemed thereby to have subjected itself to this chapter.
(c) The remedies provided in this chapter are in addition to any other methods provided by law for service of process upon insurers. (Added 1979, No. 50, § 2; amended 2019, No. 57, § 14.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 138 - Non-Admitted Insurers and Surplus Lines Insurance › § 5039. Penalties

§ 5039. Penalties
In addition to any other penalty provided for in this chapter or otherwise provided by law, including any suspension, revocation, or refusal to renew a license, any person, firm, association, or corporation violating any provision of this chapter shall be liable for an administrative penalty not exceeding $1,000.00 for the first offense and not exceeding $2,500.00 for each succeeding offense. (Added 1979, No. 50, § 2; amended 1995, No. 167 (Adj. Sess.), § 22.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 138 - Non-Admitted Insurers and Surplus Lines Insurance › § 5040. Separability of provisions

§ 5040. Separability of provisions
If any provision of this chapter, or the application of such provision to any person or circumstances, shall be held invalid, the remainder of the chapter and the application of such provision to persons or circumstances other than those as to which it is held invalid, shall not be affected thereby. (Added 1979, No. 50, § 2.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 139 - Health Maintenance Organization › § 5101. Definitions

§ 5101. Definitions
As used in this chapter:
(1) “Commissioner” means the Commissioner of Financial Regulation.
(2) “Health maintenance organization” means any person who furnishes, either directly or through arrangements with others, comprehensive health care services to an enrolled member in return for periodic payments; the amounts of said payments are agreed upon prior to the time during which the health care services may be furnished; and who is obligated to the member to arrange for or to provide directly available and accessible health care services.
(3) “Person” includes individuals, partnerships, associations, trusts, and corporations.
(4) “Health care services” means physician, hospitalization, laboratory, x-ray service, and medical equipment and supplies, which may include: medical, surgical, and dental care; psychological, obstetrical, osteopathic, optometric, optic, podiatric, chiropractic, nursing, physical therapy services, and pharmaceutical services; health education; preventive medical, rehabilitative, and home health services; inpatient and outpatient hospital services, extended care, nursing home care, convalescent institutional care, laboratory and ambulance services, appliances, drugs, medicines, and supplies; and any other care, service, or treatment of disease or conditions, or the maintenance of the physical and mental well-being of members.
(5) “Member” means any individual who has entered into a contract with a health maintenance organization for health care services or for services related to but not limited to processing, administering, or the payment of claims for health care services or on whose behalf such an arrangement has been made.
(6) “Evidence of coverage” means any certificate, agreement, or contract issued to a member setting out the coverage to which the member is entitled and the rates for that coverage.
(7) “Provider” means any physician, hospital, or other institution, organization, or other person who furnishes health care services.
(8) “Grievance” means a written complaint submitted to the Department or to the health maintenance organization in accordance with the health maintenance organization’s formal grievance procedure by or on behalf of a member regarding any aspect of the health maintenance organization relative to the member.
(9) “Uncovered expenditures” mean the costs to the health maintenance organization for health care services that are the obligation of the health maintenance organization, for which a member may also be liable in the event of the health maintenance organization’s impairment or insolvency, and for which no alternative arrangements for payment have been made that are acceptable to the Commissioner. (Added 1979, No. 117 (Adj. Sess.); amended 1989, No. 225 (Adj. Sess.), § 25; 1993, No. 30, §§ 1, 2, eff. May 21, 1993; 1995, No. 180 (Adj. Sess.), § 38 2011, No. 78 (Adj. Sess.), § 2, eff. April 2, 2012; 2013, No. 96 (Adj. Sess.), § 21; 2021, No. 105 (Adj. Sess.), § 238, eff. July 1, 2022.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 139 - Health Maintenance Organization › § 5102a. Grievance procedures

§ 5102a. Grievance procedures
A health maintenance organization shall establish and maintain a grievance or complaint handling procedure that has been approved by the Commissioner to provide for the resolution of grievances and complaints initiated by members. The organization shall respond in writing to any grievance or complaint within 15 days, advising the complainant of the resolution of the grievance or complaint or that a resolution is in process and that a response will be furnished in a timely manner. The health maintenance organization shall maintain records on all grievances received under this section until the Department has filed a report of examination on the grievances but no longer than seven years from the date of the grievance. Members shall be provided with a copy of the grievance procedures upon enrollment. (Added 1993, No. 30, § 6, eff. May 21, 1993.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 139 - Health Maintenance Organization › § 5103. Precertificate activities

§ 5103. Precertificate activities
The Commissioner, in his or her discretion, may permit an applicant to contact potential members prior to the issuance of a certificate of authority, to discuss the health care services the applicant proposes to offer and the proposed evidences of coverage. (Added 1979, No. 117 (Adj. Sess.).)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 139 - Health Maintenance Organization › § 5104. Filing and approval of rates and forms; supplemental orders

§ 5104. Filing and approval of rates and forms; supplemental orders
(a)(1) A health maintenance organization that has received a certificate of authority under section 5102 of this title shall file and obtain approval of all policy forms and rates as provided in sections 4062 and 4062a of this title. This requirement shall include the filing of administrative retentions for any business in which the organization acts as a third party administrator or in any other administrative processing capacity. The Commissioner or the Green Mountain Care Board, as appropriate, may request and shall receive any information that the Commissioner or the Board deems necessary to evaluate the filing. In addition to any other information requested, the Commissioner or the Board shall require the filing of information on costs for providing services to the organization’s Vermont members affected by the policy form or rate, including Vermont claims experience, and administrative and overhead costs allocated to the service of Vermont members. Prior to approval, there shall be a public comment period pursuant to section 4062 of this title. A health maintenance organization shall file a summary of rate filings pursuant to section 4062 of this title.
(2) The Commissioner or the Board shall refuse to approve the form of evidence of coverage, filing, or rate if it contains any provision that is unjust, unfair, inequitable, misleading, or contrary to the law of the State or plan of operation, or if the rates are excessive, inadequate, or unfairly discriminatory, fail to protect the organization’s solvency, or fail to meet the standards of affordability, promotion of quality care, and promotion of access pursuant to section 4062 of this title. No evidence of coverage shall be offered to any potential member unless the person making the offer has first been licensed as an insurance agent in accordance with chapter 131 of this title.
(b) In connection with a rate decision, the Board may also make reasonable supplemental orders and may attach reasonable conditions and limitations to such orders as the Board finds, on the basis of competent and substantial evidence, necessary to ensure that benefits and services are provided at reasonable cost under efficient and economical management of the organization. The Commissioner and, except as otherwise provided by 18 V.S.A. §§ 9375 and 9376, the Green Mountain Care Board shall not set the rate of payment or reimbursement made by the organization to any physician, hospital, or health care provider. (Added 1979, No. 117 (Adj. Sess.); amended 1991, No. 166 (Adj. Sess.), § 15; 1993, No. 30, § 8, eff. May 21, 1993; 1993, No. 235 (Adj. Sess.), § 10b; 2011, No. 48, § 15d, eff. Jan. 1, 2012; 2011, No. 171 (Adj. Sess.), § 25a, eff. May 16, 2012; 2013, No. 79, § 5k, eff. Jan. 1, 2014.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 139 - Health Maintenance Organization › § 5105. Examinations

§ 5105. Examinations
(a) The Commissioner shall make an examination of the affairs of any health maintenance organization organized or holding a certificate of authority as a health maintenance organization in this State as often as the Commissioner deems it necessary, but not less frequently than once in every three years to ensure that the financial and contractual obligations of the health maintenance organization are being met in accordance with Vermont law. The Commissioner may enlarge this three-year period to five years, provided the health maintenance organization is subject to a comprehensive annual audit during such period of a scope satisfactory to the Commissioner, by independent auditors approved by the Commissioner. The Commissioner shall examine a health maintenance organization that is organized in another state as if it were organized in this State. In lieu of such examination, the Commissioner may accept an examination report on the company as prepared by the insurance department of the company’s state of domicile. Prior to accepting an examination report from any foreign jurisdiction, the Commissioner shall determine that the examination was performed in a manner and using methods and criteria that are as stringent as those established for Vermont examinations. Nothing in this section shall restrict the Commissioner’s power to examine a health maintenance organization when the Commissioner deems it to be in the best interests of members or policyholders.
(b) All financial and market conduct examinations shall be conducted pursuant to and in conformity with sections 3573, 3574, 3575, and 3576 of this title at the expense of the health maintenance organization and shall be conducted in accordance with guidelines, principles, manuals, instructions, and other procedures promulgated by the National Association of Insurance Commissioners, including the use of statutory accounting principles for financial examinations, together with any useful or necessary modifications or adaptation thereof required or approved by the Commissioner. Every health maintenance organization shall provide the Commissioner with all books and records relating to its operation, including books and records of any affiliate or subsidiary as defined in section 3681 of this title. For the purpose of examinations, the Commissioner may issue subpoenas, administer oaths to, and examine any person and the officers and agents of the health maintenance organization. (Added 1979, No. 117 (Adj. Sess.); amended 1993, No. 30, § 9, eff. May 21, 1993; 1999, No. 38, § 3, eff. May 20, 1999; 2009, No. 42, § 12; 2021, No. 105 (Adj. Sess.), § 240, eff. July 1, 2022.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 139 - Health Maintenance Organization › § 5106. Annual report to the Commissioner

§ 5106. Annual report to the Commissioner
(a) Every organization subject to this chapter, annually, within 90 days of the close of its fiscal year, shall file a report with the Commissioner, said report verified by an appropriate official of the organization, showing its financial condition on the last day of the preceding fiscal year. The report shall be prepared in accordance with the National Association of Insurance Commissioners’ Accounting Practices and Procedures Manual for health maintenance organizations and shall be in such general form and context, as approved by, and shall contain any other information required by the National Association of Insurance Commissioners together with any useful or necessary modifications or adaptations thereof required, approved, or accepted by the Commissioner for the type of organization to be reported upon, and as supplemented by additional information required by the Commissioner.
(b) A health maintenance organization shall, when determining liabilities, include an amount estimated in the aggregate to provide for any unearned premium and for the payment of all claims for health care expenditures that have been incurred, whether reported or unreported, which are unpaid and for which such organization is or may be liable, and to provide for the expense of adjustment or settlement of such claims. (Added 1979, No. 117 (Adj. Sess.); amended 1993, No. 30, § 10, eff. May 21, 1993; 2011, No. 171 (Adj. Sess.), § 29, eff. May 16, 2012.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 139 - Health Maintenance Organization › § 5108. Prohibited practices

§ 5108. Prohibited practices
Section 4724 of this title relating to unfair trade practices shall be construed to apply to health maintenance organizations, except to the extent that the Commissioner determines that the nature of health maintenance organizations renders such section clearly inappropriate. (Added 1979, No. 117 (Adj. Sess.).)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 139 - Health Maintenance Organization › § 5109. Sanctions

§ 5109. Sanctions
Upon satisfactory evidence that any health maintenance organization has violated any law or regulation or in any way has failed in meeting its financial and contractual obligations to its members, including quality assurance as provided by 18 V.S.A. § 9414, the Commissioner may, in the Commissioner’s discretion, pursue any one or more of the following courses of action:
(1) Suspend the certificate of authority to operate as a health maintenance organization under this chapter. During the period of suspension, the organization shall not enroll any additional members except new employees of any employer whose employees are enrolled in the health maintenance organization by virtue of their employment, newborn children, or other newly acquired dependents of existing members and shall not engage in any advertising or solicitation whatever.
(2) Revoke the certificate of authority to operate as a health maintenance organization under this chapter. When the certificate of authority is revoked, the organization shall proceed under the supervision of the Commissioner, immediately following the effective date of the order of revocation, to wind up its affairs, and shall conduct no further business except as may be essential to the orderly conclusion of the affairs of the organization. It shall engage in no further advertising or solicitation whatsoever. The Commissioner may, by written order, permit such further operation of the organization as the Commissioner may find to be in the best interests of members to the end that members will be afforded the greatest practical opportunity to obtain continuing health care coverage.
(3) Impose an administrative penalty of not more than $5,000.00 for each and every unlawful act committed; each violation shall constitute a separate fineable offense.
(4) Issue an administrative order requiring the health maintenance organization: to cease or modify inappropriate conduct or practices by it or any of the personnel employed or associated with it; to fulfill its contractual and financial obligations to its members.
(5) When the Commissioner has cause to believe that grounds for the denial of an application for a certificate of authority exist or that grounds for the suspension or revocation of a certificate of authority exist, the Commissioner shall notify the health maintenance organization in writing specifically stating the grounds for denial, suspension, or revocation and fixing a time of at least 30 days thereafter for a hearing on the matter. (Added 1979, No. 117 (Adj. Sess.); amended 1993, No. 30, § 12, eff. May 21, 1993; 1995, No. 167 (Adj. Sess.), § 23; 2021, No. 105 (Adj. Sess.), § 242, eff. July 1, 2022.)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 139 - Health Maintenance Organization › § 5110. Name of health maintenance organization

§ 5110. Name of health maintenance organization
No health maintenance organization, unless licensed as an insurer, may use in its name, evidences of coverage, contracts, or literature, any of the words “insurance,” “casualty,” “surety,” “mutual,” or any other words descriptive of the insurance, casualty, or surety business or deceptively similar to the name or description of any insurance or surety corporation doing business in this State. (Added 1979, No. 117 (Adj. Sess.).)
2023 Vermont Statutes › Title 8 - Banking and Insurance › Chapter 139 - Health Maintenance Organization › § 5111. Rules

§ 5111. Rules
The Commissioner may, after notice and hearing, adopt reasonable rules under 3 V.S.A. chapter 25 as are necessary or proper to carry out the provisions of this chapter. (Added 1979, No. 117 (Adj. Sess.); amended 2015, No. 23, § 86.)