Chapter 10 VA Personal Lines State Laws

Fiduciary Responsibilities

A fiduciary is one who is entrusted to care for, or act on behalf of, another. The integrity and fidelity of a fiduciary must be absolute because fiduciary responsibility is the highest standard of care and conduct imposed by ethics and law. Virginia insurance law requires all premiums, return premiums, and other funds received by an agent or a surplus lines broker be held in a fiduciary capacity and be accounted for by the agent or surplus lines broker. The agent or broker must, in the ordinary course of business, pay the funds to the party entitled to the payment.

Loss Payable Clause

if a policy has a Loss Payable Clause as an endorsement, a third party will receive the loss payment instead of the named insured or beneficiary. The third party is also referred to as the payee or loss payee. In the event a named insured commits a fraudulent act or omission, the loss payee's interest must not become invalid, unless the loss results from the insured's conversion, secretion, or embezzlement of the covered auto. The insurer holds the right to cancel the policy as permitted by policy terms. The insurer will give the same advance notice of cancellation to the loss payee as the named insured. When the insurer pays the loss payee they must, to the extent of the payment, be subrogated to the loss payee's right of recovery.

Each standard property policy must include the following provisions, conditions, stipulations, and agreements:

Concealment or fraud Uninsurable and excepted property Perils not included Other insurance Conditions suspending or restricting insurance Other perils or subjects Added provisions Waiver provisions Cancellation of policy Mortgagee interests and obligations Pro rata liability Requirement in case loss occurs Appraisal Company's options Abandonment When loss payable Suit Subrogation No change can be made to the sequence of the words and paragraphs of the standard provisions, conditions, stipulations, and agreements listed. The order and line number for each provision must be retained.

When cancelling a personal auto policy (PAP), insurers must give written notice of at least:

10 days for a new policy in effect for 60 days or less (not a renewal) 15 days if for nonpayment of premium on a policy in effect for over 60 days 45 days' notice in all other cases

Cancelation by the Insured (Dwelling)

A policy may be cancelled at anytime by the insured by giving the insurer a 5-day notice of cancellation. The insurer must refund excess premium above the customary short rates for the expired time.

Property Laws

Standard Insuring Agreement for Fire Insurance Policies

to act as an agent means to:

sell, solicit, or negotiate insurance contracts on behalf of a licensed Virginia insurer Receive or share any commission or other valuable consideration in connection with the sale, solicitation, or negotiation of any insurance contract

Personal Line Laws

Financial Responsibility Every motor vehicle owner's policy must designate by description which vehicles are covered under the policy. The policy must cover the named insured listed in the policy and any other person using or responsible for the use of such vehicles with permission of the named insured. The Commissioner must require the owner of a motor vehicle involved in any accident of which a report is made to provide information certifying their financial responsibility;

Provisions for Certain Risks

Homeowners policies that provide for the full replacement cost of property insured must also permit the insured the option to file the claim for the actual cash value of the property. This option must be without prejudice to their right to file the claim for the difference between actual cash value and full replacement value, so long as the claim is made within 6 months of the last date on which the insured received a payment for the actual cash value.

Information Security Program

Insurance companies and agents must implement an information security program to protect against anticipated threats or hazards to the security or integrity of information, ensure the confidentiality of policyholder information, and protect against unauthorized access to or use of information that could result in substantial harm to policyholders.

Special Provisions- Dwelling

Perils Insured Against The insurer will cover windstorm or hail damage to canoes and rowboats stored outside the covered building. Coverage C Property not covered includes: --Accounts, bills, bullion, currency, deeds, evidences of debt, manuscripts, money, and securities --Aircrafts and parts --Motor vehicles or all other motorized land conveyances, including camera instruments, accessories, antennas, tapes, wires, records, discs, and other mediaVehicles used to service the insured property or designated to assist people with disabilities are covered --Property of roomers and boarders not related to the insured --Business property in storage or held as a sales sample or away from the described location The following special limits of liability are included: $100 on bank notes, coins, gold other than goldware or gold-plated ware, platinum and silver other than silverware or silver-plated ware $500 on letters of credit, notes other than bank notes, passports, tickets and stamps

Other Powers and Duties of the Association

The Association may: Employ or retain persons necessary to perform its duties Borrow funds necessary to function in accordance with the plan of operation Sue or be sued Negotiate and become a party to insurance contracts covered by the Association Perform any other necessary and proper acts If a member insurer fails to pay an assessment when due, or fails to comply with the plan of operation, the Commission may: Suspend or revoke the insurer's license to transact insurance in Virginia Levy a fine up to 5% of the unpaid assessment per month, subject to a minimum fine of $100 per month

Optional Coverages

Water Sewer Backup Any insurer who issues or delivers a new or renewal Homeowner's insurance policy in Virginia must offer as an option a provision insuring against loss caused or resulting from water that backs up through sewers or drains. Ordinance or Law Any insurer that issues or delivers in Virginia a new or renewal contract or policy of Standard Fire insurance, or a new or renewal contract or policy of Standard Fire insurance in combination with other insurance coverages, must offer in writing as an option a provision that property will be repaired or replaced in accordance with applicable ordinances or laws that regulate construction, repair or demolition.

Unfair Discrimination

---Permitting individuals of the same class and hazard to be charged different insurance rates for the same coverage—unless the rate difference is based on sound actuarial principles or related to actual experience ----Refusing to insure or renew insurance for an individual, or charging an individual a different rate for coverage, based solely on blindness or mental or physical impairments—unless the action is based on sound actuarial principles ---Discriminating between individuals or risks of the same class and hazard by refusing to issue or renew insurance, or cancelling or limiting the amount of insurance, based solely on the geographical location of an individual or a risk—unless the action is based on a legitimate business purpose or required by law ---Discriminating between individuals or risks of the same class and hazards by refusing to insure or renew, or cancelling or limiting the amount of insurance, on residential property based solely on the age of the property—unless the action is based on a legitimate business reason or required by law ---Using the status of a victim of domestic violence as an element in any decision concerning a policy's underwriting, pricing, renewal, extent of coverage, or payment of claims

Exceptions to Licensing

--Officers, directors, or employees of an insurer or insurance producer employed in executive, administrative, managerial, and/or clerical capacities --Employment related to underwriting, loss control, or claims functions --Employees who act as special agents or agency supervisors whose activities are limited to providing technical advice and assistance that does not include the sales, solicitation, or negotiation of insurance --Any person who secures and furnishes information for group insurance for the purpose of enrolling individuals in plans, issuing plan certificates, or assisting with the administration of plans --Any person who performs administrative services in connection with mass marketed property and casualty insurance --An employer or association engaged in the administration of its own employee benefits plan so long as no person connected to the employer or association is compensated by the insurer --A nonresident who sells, solicits, or negotiates commercial lines insurance to an insured with risks located in multiple states, so long as that nonresident is licensed to sell, solicit, or negotiate insurance in the state where its principal place of business is located

Nonrenewal

A Homeowners policy cannot be terminated by an insurer by refusal to renew except at the expiration of the stated policy period or term and unless written notice is mailed to the named insured or delivered electronically to the address provided by the named insured.

Business Entity

A business entity is defined as a partnership, limited partnership, limited liability company, corporation, or other legal entity other than a sole proprietorship. Business entities must be legally established before being licensed and appointed to act as insurance agents. Before obtaining an insurance license, they must submit certification containing: ---The name under which business will be conducted or transacted ---The names of each person, partnership, limited liability company, or corporation owning the business entity, along with their post office and residence addresses ---The date the business entity was registered to transact business in Virginia (if a foreign entity) A business entity acting as an insurance producer must obtain an insurance producer license; before obtaining the license, the business entity must submit the required application and pay the appropriate fees. Business entities must designate a licensed producer to be responsible for the business entity's compliance with Virginia insurance laws, rules, and regulations.

Disciplinary Actions (probation, suspension, revocation, or denial)

A license remains in force unless terminated, suspended, or revoked. If the Commission refuses to grant or revokes or suspends a license, any appointments of the licensee will also be revoked or suspended. The State Corporation Commission may place on probation, suspend, revoke, refuse, or nonrenew any person's license for one or more of the following reasons: Providing materially false, misleading, or incomplete information in a license application or any other document filed with the Commission Violating any insurance laws, regulations, subpoenas, or orders Obtaining, or attempting to obtain, an insurance license through fraud or misrepresentation Rebating Twisting Improperly withholding, embezzling, or stealing any money or property received in the course of doing business Misrepresenting intentionally the terms of an existing or proposed insurance application or contract Admitting to, or having been found to have committed, fraud or any insurance unfair trade practice Failure to provide a criminal history record report Being convicted of a felony Using fraudulent, coercive, or dishonest practices Demonstrating incompetence or untrustworthiness in the conduct of business Demonstrating financial irresponsibility when handling funds of any applicant, policyholder, agency, or insurer Having an insurance producer license denied, suspended, or revoked in any jurisdiction Forging an insurance application or any document related to an insurance transaction Using notes or reference materials improperly when completing an insurance license exam Knowingly accepting insurance business from an individual who is not licensed Failing to comply with a court or administrative order imposing a child support obligation Failing to pay state income tax or comply with any order directing its payment The Commission may refuse to issue an applicant's license if it believes the applicant does not have a reputation for being honest and of good character. When proposing to deny, suspend, or revoke a license, the Commission must provide at least 10 days' notice. If a license is denied, suspended, or revoked, the applicant or licensee is prohibited from applying for another license for at least 5 years from the date of the Commission's order. The Commission may deny, suspend, or revoke a business entity's license after notice and the opportunity for a hearing if any individual licensee acting on behalf of the business, at its direction or with its permission, committed a violation of insurance laws if: ---One or more of the business' partners, officers, or managers knew the violation took place ---The business failed to take corrective action or report the violation to the Commission

resident insurance agent (producer)

A licensed agent represents an insurer that issued the insurance sold, solicited, or negotiated by the agent. A person may not claim to be a representative, authorized agent, agent, or other term implying an appointed relationship with a particular insurer unless they are appointed by the insurer. A premium payment made by an insured to an agent, where the insurer acknowledged insurance for a specific policy period by the issuance of a policy, is considered payment to the insurer. The insurer will be liable to the insured for any covered losses and the return of any unearned premium amount due to the insured. For notice of claim or suit, the agent of record is deemed to be the agent of the insurer. Unless authorized by the Commission, no individual whose license was revoked or voluntarily surrendered is permitted to own, operate, or be employed by an insurance agent or agency during the time such person is unlicensed

Underinsured Motorist Coverage (UIM)

A motor vehicle is underinsured when the total amount of bodily injury and property damage liability insurance, bonds, and deposits of money or securities that apply to the loss is less than the total amount of uninsured motors coverage in place on any injured person. If an injured person is entitled to Underinsured Motorists coverage (UIM) under more than one policy, the following order of priority applies: --The policy insuring the motor vehicle occupied by the injured person --The policy of the injured person, if they are a named insured on a policy insuring a vehicle that was not involved in the accident If the injured person is not a named insured on any policy, the policy covering the injured person as an insured (for example, the policy of a family member) If more than one insurer provides UM coverage under multiple policies, each insurer's liability will be proportioned based on its respective UIM coverages.

Cancellation

A policy or contract written to insure homeowners (owner-occupied dwellings) cannot be cancelled by an insurer unless written notice is mailed or delivered to the named insured at the address stated in the policy, or is delivered electronically to the address provided by the named insured. Insurers may not cancel an insurance policy unless it is for one of the following reasons: --Nonpayment of premium --Conviction of a crime related to acts that increase the likelihood of loss --Fraud or material misrepresentation --A physical inspection reveals that willful or reckless acts or omissions increase the likelihood of loss --A physical inspection reveals physical changes in the property have rendered it uninsurable The property was sold in foreclosure An insurer may not refuse to renew a policy solely because of one or more of the following factors: --Lawful occupation, including military service --Credit information contained in a consumer report --Any claim resulting primarily from natural causes --Any inquiry from an insured about their coverage or policy provisions --For the insured having a foster child on the insured property

Trust Accounts

A separate fiduciary account, also called a trust account, must be maintained and kept separate from any other personal or business account. Commingling client premiums and funds with any of the agent's personal or other business funds is expressly prohibited. Client monies must be kept separate from personal funds. Funds deposited into the separate fiduciary account may not be commingled or combined with other funds except for the purpose of: ---Advancing premiums ---Establishing reserves for the payment of return premiums; or ---Guaranteeing the account has sufficient funds to make all required payments An accurate record and itemization of all money deposited into the account must be maintained. The commission portion of any premiums deposited into the separate account may be withdrawn at the discretion of the agent or surplus lines broker. If a licensed business entity maintains a separate fiduciary account, individual agents and surplus lines brokers acting on behalf of that entity may use the business' fiduciary account; they are not required to establish their own separate fiduciary accounts. In addition, if a duly appointed agent has entered into a written contract with an insurer that contains provisions addressing the remittance of funds, or is contractually authorized, the appointed agent is not required to establish a separate fiduciary account for the funds addressed in the contract. Misappropriating funds held in a fiduciary capacity may result in suspension or revocation of a license.

Surplus Line Broker

A surplus lines broker's license may be issued to any individual or business entity actively licensed as a resident property and casualty insurance agent for procuring insurance from eligible nonadmitted insurers. Before obtaining a license, the applicant must file an application and certification that they have and will continue to keep a $25,000 bond. Surplus lines licenses are renewable annually upon filing a renewal application and paying the annual nonrefundable fee. If an individuals property and casualty license is terminated, the surplus lines license will also be terminated. A person licensed in their home state as a surplus lines broker may receive a nonresident surplus lines broker's license if they meet the requirement

Notice and Review (Dwelling)

A written notice of cancellation or refusal to renew a policy written to cover owner-occupied dwellings must state the proposed termination date of the policy or contract, which must be a minimum of 30 days after the mailing or delivery of the notice of cancellation or refusal to renew. When the policy is being terminated for nonpayment of premium, the proposed termination date must be at least 10 days from the date of mailing or delivery of the notice. The notice must state the specific reason(s) for nonrenewal or cancellation, and inform the insured of possible eligibility for coverage through the Virginia Property Insurance Association (FAIR Plan). The Mortgagee Clause requires insurers to notify the mortgagee at least 10 days before the effective date for cancellation and at least 30 days before the effective date for nonrenewal. The insured must be advised of the right to submit, within 10 days of receiving notice, a written request to the Commissioner for a review of the insurer's compliance with law that pertains to the mailing of the notice. If the insured requests a review as specified, the policy will continue in force during the Commissioner's review, unless the reason for cancellation is nonpayment. If the Commissioner finds the insurer did not comply with law when sending notice of nonrenewal or cancellation, they must notify all parties to whom notice was required to be sent that the nonrenewal or cancellation is not effective.

Agent Regulation

Acting for an Unlicensed Insurer A person may not sell, solicit, or negotiate contracts of insurance on behalf of any insurer unless they are licensed to transact insurance business. However, nothing prohibits any person from obtaining insurance on their own life or property from an unlicensed insurer. Any person in violation of this law will be guilty of a misdemeanor and punished for each offense. They will also be held liable on any claim against an unlicensed insurer that arises out of a contract or policy sold, solicited, or negotiated by that person. Record Retention All insurance licensees are required to retain all records relative to their insurance transactions, including records of applications on issued policies, accounting records of premiums paid, and files of policies cancelled mid-term. Records of premium quotations not accepted by the proposed insured are not required to be kept. Records must be maintained for a minimum of the 3 previous calendar years. The records must be made available promptly to the Commission upon request. The State Corporation Commission has the authority to examine records at any time during normal business hours, without advance notice.

Uninsured/Underinsured Motorists Coverage (UM/UIM)

All Auto Liability insurance policies issued in Virginia that provide Motor Vehicle Liability coverage, including coverage on motorcycles, must include a provision or endorsement obligating the insurer to pay all sums the insured is legally entitled to recover from the owner or operator of an uninsured motor vehicle. In order for coverage to apply, the uninsured driver must be at fault. The limits for Uninsured Motorist coverage can be no less than the minimum limits required by law as follows: --$30,000 per person for bodily injury or death in any one accident --$60,000 per accident for the total of two or more persons for bodily injury or death in any one accident --$20,000 per accident for all damage or destruction of property The policy may provide an exclusion of the first $200 of the loss or damage that is the result of any one accident involving an unidentified owner or operator of an uninsured motor vehicle. The named insured is entitled to purchase Uninsured/Underinsured coverage limits equal to the liability limits provided by the policy. The insurer is required to provide notice to the insured that the increase in coverage will be provided at an additional premium charge. The notice must state that the premium will increase unless the named insured notifies the agent or insurer to reduce the limits. The named insured has the right to reject additional coverage and reduce the limits of the Uninsured/Underinsured Motorist coverage to less than the liability limits on the policy, but no lower than the required financial responsibility limits. The insurer may require that the request to reduce the UM/UIM liability coverage be in writing. The insured must communicate the desire to reduce coverage within 20 days of the mailing of the policy or premium notice. The election to reduce coverage is binding to all insureds in the policy. Later, if the insured decides to increase their limits, they must make a special request in writing.

Notice Regarding Earthquake Exclusion

All insurers issuing new or renewal Standard Fire insurance policies or Standard Fire insurance in combination with other coverages, which exclude coverage for damage to earthquake, must provide written notice that: --Explicitly states that earthquake coverage is "excluded unless purchased by endorsement" --States that information regarding earthquake insurance is available from the insurer or agent, if that is the case

Selected Endorsements

Amendment of Policy Provisions The insurer will provide Collision coverage and Other Than Collision coverage according to what is shown in the Declarations page. If there is a loss to a non-owned auto, the insurer will provide the broadest coverage applicable to any of the covered auto shown in the policy. Supplementary Payments Virginia's amendment adds the following supplementary payments: --Up to $250 for bail bonds required because of an accident that results in bodily injury or property damage --Premiums on appeal bonds and bonds to release attachments in any suit the insurer defends --Up to $200 per day for loss of earnings caused by attendance at hearings or trials the insurer requests --Other reasonable expenses incurred at the insurer's request --General average and salvage charges for which an insurer becomes legally responsible because of an auto being transported --Prejudgement interest awarded against the insured. If the insurer makes an offer to pay the limit of liability, the insurer will not pay any prejudgement interest after the offer. These supplementary payments do not reduce the limit of liability. Part B - Medical Payments Part B does not apply to auto policies in Virginia. Medical Payments must be added by endorsement. Part D - Coverage for Damage to Your Auto Transportation Expenses are not covered. Transportation Expenses must be added by endorsement. Coverage is included for a total loss to a vehicle due to the destruction or confiscation by governmental or civil authorities. Coverage is included for a trailer, camper body, and the attached facilities and equipment, if the insured notifies the insurer and requests insurance within 30 days of becoming the owner. These two coverages were previously excluded. Coverage for the diminution in market value of a vehicle is excluded. Payment of Loss Provision The insurer may pay for loss in money or repair or replace the damaged or stolen property. The insurer may, at its own expense, return any stolen property to the named insured or the address shown in the policy. If stolen property is returned, the insurer will pay for any damage resulting from the theft. The insurer may keep all or part of the property at an agreed or appraised value. If the insurer pays for loss in money, the payment will include the applicable state and local sales and use taxes for the damaged or stolen property at the time of loss as well as titling and license transfer fees incurred in obtaining a replacement vehicle in the event of a total loss. This is in addition to the limit of liability. In the event of a total loss, the insurer will satisfy any applicable salvage or disposal charges.

Appointment Procedures

An appointment issued to an agent by an insurer, unless terminated, suspended, or revoked, authorizes the appointee to act as an agent for that insurer and to be compensated by that insurer. Agent's Contract versus Agent's Appointment Every licensed agent may sell policies and solicit applications for insurance on behalf of the insurer as long as they have a contract and are licensed in that line of authority even if they have not yet been validly appointed, subject to the following: ---An insurer must, within 30 days of the date of execution of the first insurance application submitted by a contracted but not yet appointed agent, either reject the application or file a notice of appointment with the Commission ----The insurer must, within the same 30 days, provide verification to the agent that the notice of appointment has been filed with the Commission ---Upon receipt of notice of appointment, the Commission will verify that the agent holds a valid license and the appointment was properly submitt Solicitation Prior to Appointment Within 5 calendar days of receiving the notice of appointment, the Commission must notify the insurer whether the appointment is valid or invalid. If an agent sells or solicits insurance on behalf of the insurer after being notified the appointment is invalid, the agent will be violating insurance law and will be subject to penalties. Fees and Penalties Insurers are required to pay a fee for the appointment/renewal of each agent's appointment. Fees are billed quarterly by the Commission to insurers. Each quarterly billing will include charges for appointment notifications submitted to the Commission during the preceding quarter, regardless of the current status of the appointment. A penalty of $50 per day will be charged to each insurer for overdue appointment fees. The appointment fee will not be considered paid until the appropriate fee and all penalties are paid in full. Duration of Appointment A valid appointment authorizes the agent to act for the insurer as long as the appointing insurer is licensed in this state unless the appointment is otherwise terminated, suspended, or revoked. The insurer has the authority to terminate an agent's authority at any time. Termination Notification The agent or agency must immediately cease selling or soliciting on behalf of an insurer no later than 10 calendar days after notice of termination, suspension, or revocation of appointment. An insurer that terminates the appointment, employment, contract, or business relationship must notify the Commission within 30 calendar days following the effective date of the termination if the reason for termination is grounds for probation, refusal to renew, suspension, or revocation of license. The insurer must promptly notify the Commission if, upon further review, they discover additional information that would have been reportable to the Commission had they known. The insurer must mail a copy to the agent to their last known address within 15 days of notifying the Commission. An individual will not be held liable for furnishing information, without actual malice, that results in an agent's termination.

Proof of Residency

An individual is considered a resident of Virginia, provided that the individual: ---Maintains a principal place of residence ---Declares themselves as a Virginia resident on their federal tax return ---Pays Virginia income tax and personal property tax The Commissioner may also consider other documentation such as a valid Virginia driver's license or voter registration card as additional proof of residency. An individual who is unable to show proof of residency will not be deemed a resident of Virginia, except for individuals residing outside of Virginia whose principal place of business is in Virginia, who are able to demonstrate that the laws of their home state prevent them from obtaining a resident agent license in that state, and who affirmatively chooses to qualify as and be treated as a resident of Virginia.

Nonresident licence

An individual or business entity who is not a resident of Virginia will receive a nonresident license if: ---The applicant presents satisfactory proof that they are currently licensed as a resident and is in good standing in their home state ---The applicant has submitted the proper request and paid the required fees ---The applicant has submitted the application for licensure through their home state or a Uniform Application The applicant's home state issues nonresident agent licenses to residents of Virginia on the same basis The Commissioner may enter into a reciprocal agreement with any other state, territory, or province of Canada if required for Virginia residents to be similarly licensed as a nonresident in that state, territory, or province. Nonresident licenses will be terminated at any time that the individual's resident license is terminated, suspended, or revoked

Insurance Consultant

An insurance consultant is an individual or business entity licensed to act as an independent contractor for the client in exchange for a fee or other compensation. The fee is not paid by an insurer, an agent, or a surplus lines broker. The consultant offers advice to the client about property and casualty insurance. The following persons are not insurance consultants: ---Licensed attorneys acting in their professional capacity ----Bank trust officers acting in the normal course of their employment ---Actuaries and certified public accountants (CPAs) who consult during the normal course of their businesses ---Risk managers who only consult for their employers If a person is not licensed as an insurance consultant, that person is not permitted to: ---Provide planning or consulting services outside the scope of the activities of a licensed insurance agent ---Charge or receive, in any manner, compensation in exchange for offering insurance advice—other than commissions received as a licensed insurance agent or surplus lines broker in exchange for the sale, solicitation, or negotiation of insurance as permitted by the license Applicants for an insurance consultant license must meet the following requirements: ----Submit their license applications within 183 calendar days after passing the licensing exam (applicants holding active property and casualty insurance agent licenses are exempt from the exam requirements) ---If acting as an insurance consultant as an officer, director, principal, or employee of a business entity, hold an individual insurance consultant license If a licensed insurance consultant does not sell, solicit, or negotiate insurance as part of the services provided, the consultant must contract in writing with a client before acting as an insurance consultant and before the client purchases any insurance. The contract must include: ---The amount of the consulting fee ---The specifics of the services provided The duration of the employment ---Details about the payment of any commissions, bonuses, or form of compensation paid, in addition to the consulting fee, in exchange for the services provided Insurance consultant licenses renew every 2 years. Business entities acting as consultants must submit a renewal application before May 1 biennially.

Notice of Information Practices

An insurance institution or agent must provide a notice of insurance information practices to all applicants or policyholders in connection with an insurance transaction. The notice must be in writing, unless the policyholder agrees to an electronic format. The notice must include the following: ---If personal information can be collected from persons other than the insurance applicant ---Types of personal information that may be collected Types of sources and investigative methods that may be used to collect information ---Types of disclosures and the circumstances under which the disclosures may be made without prior authorization ---A description of the insurance applicant or policyholder's rights and how they may be exercised If an application for insurance is taken, the notice must be provided no later than: --Time of delivery of the policy when personal information is collected from only the applicant or from public records T--ime of collection of personal information when received from a source other than the applicant or public records Upon policy renewal, the notice must be provided no later than the policy renewal date, unless the personal information was collected from the applicant or public records or the notice was provided within the previous 24 months. If a policy is being reinstated or there is a change in benefits, the notice must be provided no later than the date the request for reinstatement or change in benefits is received by the insurance institution. The notice is not required if the information was provided by the applicant or public records.

Cancellation and Nonrenewal of Personal Auto Policies

An insurer may not refuse to renew or cancel a personal auto policy solely because of one or more of the following factors: Age, sex, race, color, creed, national origin, residence, ancestry, material status, sexual orientation, or gender identify Lawful occupation, including military service Number of years of driving experience Lack of supporting business 1 or more accidents or violations that occurred more than 48 months immediately preceding the policy anniversary 1 or more claims submitted under the Uninsured Motorist coverage where the uninsured motorist has been identified A single claim submitted under the Medical Expense coverage due to an accident in which the insured was neither wholly or partially at fault 1 or more claims submitted under the comprehensive or towing coverages 2 or fewer motor vehicle accidents within a 3-year period, unless the accident was caused either wholly or partially by an insured

Notice Regarding Flood Exclusion

Any insurer that issues or delivers a new or renewal Standard Fire insurance policy that excludes coverage for damage due to flood, surface water, waves, tidal water, or any other overflow of a body of water must provide written notice that: --Explicitly states that flood insurance is excluded --States that information regarding flood insurance is available from the insurer, agent, or National Flood Insurance Program --Advises the policyholder that contents coverage may be available with the flood policy for an additional premium

Penalties

Any person that knowingly or willfully violates any of Virginia's insurance laws or regulations is subject to a penalty up to $5,000 for each violation. Unintentional violations are subject to a penalty up to $1,000 for each violation with a maximum aggregate of $10,000 for all violations. The Commission may require restitution to be made for any of the following: --Charging a rate in excess of the rate permitted by statute or filed by the insurer ---Charging a premium that is unfairly discriminatory --Failing to pay a claim according to the insurance contract if the insurer did not dispute the claim --Improperly withholding, embezzling, or stealing any money or property received in the course of doing business If any person submits insurance business without a required insurance agent's license, the penalty will be a sum that equals the first year commission for the placement of that business, in addition to the penalties stated previously.

Referrals

Any person who refers a customer seeking to purchase any insurance product to a licensed agent and receives compensation for the referral of a customer is exempt from licensing, provided that: ---The referral does not include a discussion of specific insurance policy terms and conditions ---The compensation is in the form of a one-time nominal fee of a fixed dollar amount for each referral ---The compensation does not depend on whether the referral results in the purchase of insurance by the customer

FAIR Plan Basic Property Insurance

Basic property insurance is insurance that provides coverage for direct loss to covered property if it is caused by the perils defined by the Standard Fire policy and in the Extended Coverage endorsement approved by the Commission. In addition, additional lines of insurance and forms of coverage may be included if recommended by the FAIR Plan and approved by the Commission. Qualified property is all real property, such as a home or building, and tangible personal property at a fixed location in Virginia. To be qualified property, the property: -- Cannot be used for manufacturing purposes --Must comply with state laws and regulations, and local building codes and ordinances --Cannot be commonly owned or controlled, or combinable with property insured elsewhere --Cannot violate public policy based on ownership, condition, or occupancy --Automobiles and other vehicles are not considered real property Residual market facility means any Commission-approved organization that distributes fairly the responsibility to provide basic property insurance on qualified property among licensed insurers, such as the Virginia Property Insurance Association/FAIR Plan.

Binders

Binders are temporary insurance contracts that may be made and used for up to 60 days or the issuance of the policy, whichever is sooner. Binders may be oral or written. Unless expressly provided, the contract must include the usual provisions, stipulations, and agreements used in Virginia's Standard Fire policy. A binder may not waive or be inconsistent with any provision required by law.

Unfair Trade Practices

Boycott, Coercion, and Intimidation No person may enter into any agreement to commit any act of boycott, coercion, or intimidation resulting in or tending to result in unreasonable restraint of, or monopoly in, the business of insurance. Defamation No person may publish, circulate, or make any oral or written statement that is false, maliciously critical, or derogatory to any person, including an insurance company, with respect to the business of insurance or to any person in the insurance business if the statement is intended to injure. Rebating Unless specifically permitted by law, no person may: Knowingly enter into any insurance agreement that is not stated clearly in the insurance policy or contract Pay, allow, give, or offer any of the following as an inducement for the purchase of a policy if it is not stated in the policy:Premium rebateSpecial favor or advantage in the policy's dividends or other benefitsAny valuable consideration Give, sell, purchase, or offer any of the following as an inducement for the purchase of a policy if it is not stated in the policy:Stocks, bonds, or other securities of any companyDividends or profits accrued on any stocks, bonds, or other securities of any companyAnything of value Receive or accept any of the following as an inducement for the purchase of a policy if it is not stated in the policy:Premium rebateSpecial favor or advantage in the policy's dividends or other benefitsAny valuable consideration The following activities are not considered rebating: Readjustment of premiums for group insurance based on loss experience Insurers allowing their employees to receive premium discounts on insurance written on their own lives and property and on the lives and property of their spouses and dependent children Paying commissions and compensation to agents and brokers who are licensed appropriately The payment of dividends Misrepresentation No person may make, issue, or circulate an estimate, illustration, statement, sales presentation, omission, or comparison that misrepresents any element of an insurance policy. Making misleading or false statements about the coverage provided under a policy or projected dividends is considered misrepresentation. Twisting No person may engage in twisting, which is using misrepresentation by making an incomplete comparison to encourage or induce an insured to cancel an existing insurance policy and purchase a new policy, known as replacement. False Advertising No person may knowingly make, publish, circulate, or place before the public any advertisement, announcement, or statement that contains an untrue, deceptive, or misleading statement pertaining to the business of insurance or any person conducting the business of insurance. This includes information presented in any way, including in pamphlets, notices, letters, posters, and advertisements made over the radio or on television. Advertising that an agent is licensed in a particular line of authority when that is not the case is considered false advertising.

Selected Endorsements Special Provisions (Dwelling)

Coverage D and Coverage E No deductible applies to Fair Rental Value coverage or Additional Living Expense coverage. Other Coverages The following have been added to Other Coverages: Property Removed is covered for up to 30 days for all forms Fire Department Service Charge -The insurer will cover up to $500 for the insured liability for fire department service charges; however, property located within the limits of a city, municipality, or protection district is excluded. In this case, the insurer will pay up to $250 for fire department service charges incurred when a volunteer fire department is called. No deductible applies to this coverage. Conditions The following have been added to Conditions: Loss Payment - Loss will be payable 30 days after the insurer receives proof of loss and all of the following:An agreement is reached between the insurer and the insuredThere is an entry of a final judgmentAn appraisal award has been filed with the insurer Suit Against Us - No action may be brought against the insurer unless the policy provisions have been complied with and the action is started within 2 years after the date of loss Personal Property Replacement Cost Loss Settlement If the cost to repair or replace the property is more than $500, the insurer will pay no more than the actual cash value of the loss until the repair or replacement is complete. An insured may make a claim for the actual cash value and then make claim for any additional liability so long as the insured notifies the insurer within 180 days of the loss.

Coverage _personal auto insurance

Coverage must be provided against loss from any liability imposed by law for damages due to bodily injury, including death of any person, and the destruction of property caused by an accident arising out of the ownership, use, or operation of motor vehicles within the Commonwealth, United States, or Canada. The minimum required limits for personal auto insurance in Virginia are: $30,000 per person for bodily injury or death in any one accident $60,000 per accident for the total of two or more persons for bodily injury or death in any one accident $20,000 per accident for all damage or destruction of property

An uninsured motor vehicle is a motor vehicle for which: There is no bodily injury and property damage liability insurance at the required minimum limits in place Insurance is in place, but the insurer denies coverage for any reason, including failure or refusal of the insured to cooperate with the insurer There is no bond or deposit of money or securities in lieu of insurance The owner has not qualified as a self-insurer The owner or operator is immune from liability for negligence in Virginia or the United States The owner or operator is unknown, such as a hit and run UM coverage is also provided for both bodily injury and property damage losses caused by the operation or use of an underinsured motor vehicle, but only to the extent the vehicle is underinsured.

Definition of Uninsured Motorist

Maintaining A License

Duration and Termination A license is issued to an individual agent or business entity authorizing them to act as an agent until the license is otherwise terminated, suspended, or revoked. The license authority of any licensed resident agent will terminate immediately when the agent has moved their residence from the Commonwealth, whether or not the Commission has been notified of the move. The discontinuance of a partnership, limited liability company, or corporation that formed a business entity will automatically terminate all licenses issued to the business entity within 90 calendar days of notification of the discontinuance. Each business entity acting as an insurance producer must notify the Commission within 30 days of the removal of the designated licensed producer responsible for the business entity's compliance with insurance laws, rules, and regulations. The business entity must designate a new designated licensed producer within 30 calendar days following the removal of the terminated licensed producer. Address/Name Changes Each agent must report any change in residence or name to the Commission and every insurer for which they are appointed within 30 calendar days of the change. Assumed Names Any individual or business entity doing business under an assumed or fictitious name must notify the Bureau of Insurance of any such name if planning to conduct insurance business under that name. Notice must be included on the license application or within 30 calendar days from the date the name is adopted. If business is no longer conducted under the assumed or fictitious name, the individual or business entity must notify the Bureau within 30 calendar days from the date use of the name ceases and pay a $10 fee. Requirement to Report Felony Convictions and Administrative Actions Each licensed agent convicted of a felony must report the facts and circumstances of the criminal conviction to the Commission within 30 calendar days. If administrative action has been taken against an agent in another jurisdiction or governmental agency within the Commission, the licensed agent must report to the Commission within 30 calendar days of final disposition. The report must include a copy of the order, consent to order, or other relevant legal documents.

Standard Insuring Agreement for Fire Insurance Policies

Each policy must provide space for listing the amount of insurance, rates, and premiums for coverages provided in the policy and endorsements. The policy must include the agency address and name and address of the issuing insurer. Each policy must include an insuring agreement that includes the following: Insurance covering the amount of actual cash value of the property at the time of loss, but not exceeding the amount which it would cost to repair or replace the property with material of like kind and quality within a reasonable time after such loss No allowance for any increased cost of repair or reconstruction by reason of any ordinance or law regulating construction or repair No compensation for loss resulting from interruption of business or manufacture No coverage for more than the insured's interest Coverage against all direct loss by fire, lightning, and by removal from premises endangered by the perils insured against in this policy Coverage for the damage to the property of others must have a $500 limit of liability Coverage C special limit for watercraft is $1,000 Any insured building vacant for more than 30 days will be excluded from coverage

Aftermarket Parts Regulation

If an insurer's repair estimate includes any aftermarket part not made by the original manufacturer, the insurer must include the following written notice within the estimate or in a separate document attached to the estimate:

Cease and Desist

If the Commission suspects any person has violated any Virginia insurance laws, rules, regulations, or orders, it may serve a notice upon the person that: ---Includes a statement of the charges, along with a notice of a hearing that includes the date, time, and place of the hearing; the hearing must be held at least 10 days after the date the order is served ---Requires the person to show cause why a cease and desist order should not be imposed If the Commission finds the person has violated insurance laws, it may issue a cease and desist order and any other appropriate order based on the circumstances. If any person violates a cease and desist order, the punishment will be: ---The suspension or revocation of the insurance license ---Up to $5,000 per violation for knowing and willful violations ---Up to $1,000 per violation for unintentional violations, up to a maximum of $10,000

Medical Payments Limits of Liability

If the insured has 4 or less insured vehicles, the maximum limit of liability is the sum of the limits shown in the Declarations for each person applicable. If the insured has more than 4 vehicles insured, the maximum liability is the sum of the four highest limits of liability shown in the Declarations.

Continuing Education

In order to maintain and renew an insurance license, life/health/property/and casualty agents, insurance consultants, and title agents must complete continuing education (CE) courses related to their licensed class of insurance on a biennial basis, or every 2 years. The Virginia continuing education program is administered by the VA Continuing Education Board. The Board is responsible for approving CE courses, instructors, and programs of instruction for insurance agents. Agents holding one license, must complete 16 hours of approved continuing education courses. Agents who hold two or more licenses are required to complete 24 hours of relevant continuing education, with a minimum of 8 hours in each class of insurance. Of the total required credits, 3 hours of continuing education in each biennium must address the topic of ethics, which may include Virginia insurance laws and regulations. Agents are prohibited from receiving more than 75% of their required continuing education credits from courses provided by insurers or insurance agencies. Each agent subject to these requirements must complete all continuing education courses or waiver requirements and must submit proof of compliance to the Board or its administrator. Proof must be submitted biennially, corresponding with the license renewal. All CE fees specified by the Board are nonrefundable. Continuing Education Waivers A licensed agent who is unable to comply with the continuing education requirements due to military service or other extenuating circumstances, including long-term illness, may request a continuing education (CE) waiver. The request for a waiver of CE requirements with all documentation, forms, and fees must be made to the Board no later than the last day of the agent's 2-year license period. Agents who failed to complete the CE requirements after the 2-year period may request a waiver within a 12-month reinstatement period. The Board will make a decision regarding the waiver within 30 days of the request. The waiver will only be valid for the biennium for which it was applied. Failure to complete the CE course or waiver requirements, furnish proof of compliance, pay any applicable fees, or complete the license renewal requirements will result in administrative termination of each license held by the agent. Neither the Board, its administrator, nor the Commission have the power to grant an agent additional time for completing their CE credits. If a license is terminated by the Commission for failure to comply with continuing education requirements, an agent may appeal the termination within 30 days following the expiration of the license period. If a license has been terminated for failure to meet the requirements, or voluntarily surrendered by the licensee who has not provided proof of compliance, the license may be applied for, providing the agent successfully completed the licensing requirements as a new agent. For continuing education purposes, if an insurance consultant obtains a new license within 12 months of the previous license's expiration, they will be considered to have renewed the original license in a timely manner.

Activities of Unlicensed Individuals

In this context, "enrolling individuals" refers to the process of informing individuals of the availability of coverages, calculating the insurance charge, assisting with completion of the enrollment application, preparing and delivering the certificate of insurance, answering questions regarding the coverages, and assisting the individual in making an informed decision whether or not enrollment under the group insurance plan is to be elected. An unlicensed person may discuss, in general, insurance matters regarding both coverage and rates. An unlicensed person may also list available products and services in response to an inquiry made by an existing policyholder with regard to the existing policy. If such discussion develops into an explanation of the ramifications of options, how choosing one option or another will affect coverage, or similar negotiation discussion, then insurance knowledge is necessary and licensure is required. A licensed agent is not prohibited from using an unlicensed person in a clerical capacity under their direct supervision, nor does the Code of Virginia prohibit the unlicensed person from receiving or passing on to the agent any insurance inquiries or requests of a particular nature, or from taking the necessary steps to implement changes that an existing policyholder has requested be made to an existing policy.

Payment and Sharing of Commissions

Insurers are not permitted to pay any type of commission or other valuable consideration to any agent or surplus lines broker unless the person is appointed by the insurer and holds a valid insurance license for the class of insurance being written. Commissions may be paid to a trade name, as long as it has been filed by a licensed agent to the Bureau of Insurance. Similarly, only licensed and appointed agents or surplus lines brokers may accept commission or other valuable consideration from an insurer. Licensed agents are permitted to share commissions only with another agent who holds a similar license. An exception exists for the payment and receipt of renewal or deferred commissions to an unlicensed person who was appropriately appointed and licensed at the time the insurance was sold. The State Commission may suspend a license if an agent shares commission with an unlicensed person.

Records (Dwelling)

Insurers must keep copies of all nonrenewal and cancellation notices they send by mail or delivered electronically, along with evidence of electronic transmittal or proof of mailing. All records must be maintained for at least 1 year from either date of transmittal or cancellation. In addition, the insurer must send a copy of all nonrenewal and cancellation notices to any lienholder afforded right of notice by the policy.

Uninsured Private Watercraft Coverage

Insurers selling liability policies for private watercraft must, on each policy, offer the option to buy coverage for loss caused by uninsured watercrafts, up to liability limits.

Types of Insurance Licenses Virginia

Life and annuities insurance agent Health agent Property and casualty insurance agent Personal lines agent Limited lines credit insurance agent Limited lines life and health insurance agent Limited lines property and casualty insurance agent Motor vehicle rental contract insurance agent Restricted nonresident property and casualty insurance agent Restricted nonresident personal lines agent Public adjuster Surplus lines broker Title insurance agent Variable contract agent Viatical settlement broker A resident producer in Virginia may obtain a limited lines license without taking an examination.

Medical Expense and Loss of Income Benefits

Medical Expense and Loss of Income Benefits The Virginia Medical Expense and Loss of Income Benefits endorsement extends the definition of insured to mean the named insured, their spouse, and resident family members, as well as any other person who sustains bodily injury while occupying a covered auto, as a passenger in a non-owned vehicle an insured operates, or while occupying any auto or trailer which is being used as a temporary substitute. These coverages are available by endorsement on both commercial and personal auto policies. Insureds must be able to buy either or both coverages or to decline both coverages. Loss of Income Benefits - The following minimum coverages must be offered: Up to $2,000 per person for all reasonable and necessary medical, chiropractic, hospital, dental, surgical, ambulance, prosthetic, and rehabilitation services, including funeral costs Coverage only applies where services are incurred within 3 years of the accident The insured may choose to purchase a different limit of coverage Up to $100 per week for loss of income if the injured person is usually employed Coverage begins on the first date of lost work and continues for 1 year, until the injured person resumes their usual occupation, or dies

Charging of Fees

No person is permitted to charge or receive any fee, compensation, or consideration for insurance or for obtaining insurance unless it is stated in the policy. Written disclosure to an applicant regarding administrative fees or charges must be provided prior to services rendered. Written consent of administrative charges is required by a consumer in all instances. Insurance policies in Virginia must state all the fees, premiums, and other amounts charged for the insurance unless one of the following exceptions apply: ---The policy is fidelity, surety, title, or group insurance ---Charges are made lawfully by an insurance consultant ---Service charges are billed for premiums paid in installments, so long as the service charges are disclosed to the insured in writing

After a PAP has been in effect for 60 days, the insurer can only cancel it for one of these reasons:

Nonpayment of premium (15 days) The insured moves to another state During the policy period, or in case of renewal, during the last 90 days of the prior period, the license of any of the following persons is revoked or suspended:The insuredAny driver who lives with the insuredAny customary driver of the auto An insurer who cancels must refund pro rata unearned premium to the insured. If the insured cancels, the insurer is only required to refund 90% of the pro rata unearned premium. The named insured has the right, within 15 days of receiving notice, to submit a written request to the Commissioner for a review of the insurer's compliance with law that pertains to the mailing of notice: --If the insured requests a review as specified, the policy will continue in force during the Commissioner's review, unless the reason for cancellation is nonpayment --If the Commissioner finds the insurer did not comply with law when sending notice of nonrenewal or cancellation, they must notify all parties to whom notice was required to be sent that the nonrenewal or cancellation is not effective --This procedure is not a review of the underwriting decision made by the insurer—it only pertains to the insurer's compliance with requirements when sending notice of nonrenewal or cancellation

Nonrenewal

Nonrenewal requires the insurer provide notice at least 45 days before the end of the policy period. The insurer can only nonrenew a policy at the following points in time: --At the end of the policy period, for policies between 6 months and 1 year long --On the anniversary of the original effective date, where the policy period is over 1 year long --6 months after the effective date and every 6 months after, for policies shorter than 6 months If the insurer offers to renew and the insured does not pay the required renewal premium on time, the policy will automatically terminate at the end of the policy period. These requirements do not apply if: --The named insured, in any way, has notified the insurer that they do not wish to renew the policy or wants to cancel the policy --The named insured refuses to accept the insurer's offer of renewal --an affiliate of the insurer offers to provide substantially the same coverage at a lower premium Insurers must keep copies of all notices (including electronic transmittals) for at least 1 year.

Personal VS Privileged Information

Personal information is any individually identifiable information collected in connection with an insurance transaction from which judgments can be made about that individual's finances, general reputation, credit, health, and other personal characteristics. This includes the individual's name, address, and information contained in medical records. Personal information does not include privileged information or information that is publicly available. Privileged information is any individually identifiable information related to an insurance claim or a legal proceeding that is collected in connection with an individual if a reasonable expectation exists that a future claim or legal proceeding will involve that individual

Virginia Automobile Insurance Plan (Assigned Risk Pool) Powers of the Commission

Powers of the Commission The State Corporation Commission will make reasonable regulations for the assignment of risks to insurance carriers. The Commission will establish rate classifications, rating schedules, rates, and regulations to be used by insurance carriers issuing Assigned Risk policies. After reviewing information available from its records, or the records of the Department, the Commission may: --Refuse to assign an application --Approve the rejection of an application by an insurance carrier --Approve the cancellation of a policy of motor vehicle liability, physical damage, and medical payments by an insurer --Refuse to approve the renewal or reassignment of an expiring policy Any information filed with the Commission by an insurance carrier in connection with an assigned risk, including reasons for refusal to assign or renew a policy, will be confidential and solely for use by the Commission and will not be disclosed to any person, including an applicant, policyholder, and any other insurance carrier

Rental Reimbursement and Transportation Coverage

Rental Reimbursement Coverage For any policy providing comprehensive or collision coverage, insurers must also offer the option to purchase rental reimbursement coverage. Transportation Expenses Coverage There are two options in this endorsement. Option 1 provides coverage for temporary transportation expenses incurred as a result of a loss to a your covered auto and expenses incurred as a result of a loss to a non-owned auto. Coverage provided is up to the limit of liability stated in the Declarations, but must be at least $600. Option 2 provides coverage for temporary transportation expenses incurred from a loss to a covered auto up to the limit of liability stated in the Declarations, but at least $600, and expenses incurred as a result of a loss to a non-owned auto for up to 30 days

Exemptions from Continuing Education Requirements

Resident or nonresident agents who have been issued a license during the last 12 months of the biennium in which the licenses are issued will be exempt from fulfilling CE requirements for that license and only for that biennium. The following licensees are exempt from fulfilling the CE requirements: ---Insurance consultants (LH/PC) who are also licensed as insurance agents and have satisfied the CE requirements for their agent's license ---Nonresident agents who furnish evidence of their current good standing in their home state, provided their home state grants a similar exemption to VA resident agents ---Agents who have received a permanent exemption from the CE course requiremrnyd

Examination of Books and Records

The Commission has the authority to conduct an examination of insurers and investigate any person licensed to transact insurance business in Virginia to determine if the person is or has engaged in any prohibited unfair method of competition or unfair or deceptive act or practice. This authority includes: ---- Gathering information about trade practices to ensure they serve the public interest fairly and adequately -- Enforcing and imposing penalties if a person fails to provide information to the Commission in a timely manner --When necessary to protect the interests of Virginia residents, examining the affairs of any person subject to insurance regulation in Virginia --Examining every insurer licensed in Virginia at least once every 5 years --Examining foreign and alien insurers, and any other foreign persons, in cooperation with insurance regulators in other states The Commission may investigate insurance agents to determine if they are violating insurance code. The Commission has the right to examine all records that pertain to the writing of insurance. Penalties for failure to comply with this examination include the denial, suspension, or revocation of the insurance license

Standards for Content of Fire Policies

The Commission may establish standards for the content of any policy, rider, endorsement, supplemental agreement, or provision used in connection with any policy written to insure owner-occupied dwellings in Virginia. An insurer may not issue or renew a policy to insure an owner-occupied dwelling unless the form has been filed with the Commission. No policy may be more restrictive than any form designated as standard by the Commission. An insurer may issue policies with coverages, terms, and conditions which are broader and more favorable to the insured than the standards established by the Commission.

Financial Responsibility for Certain Offenses

The Department will not issue or reinstate a driver's license or learner's permit to any person for a period of 3 years until proof of financial responsibility in the future is provided that meets no less than double the minimum limits of liability, or $60,000/$120,000/$40,000, if such person is convicted of any of the following: Causing the serious bodily injury of another while driving while intoxicated in a manner so gross, wanton, and culpable as to show reckless disregard for life and unintentionally causing another serious bodily harm Driving while: Having a blood alcohol concentration of .08% or higher Under the influence of alcohol Under the influence of any narcotic and/or self-administered intoxicant or drug of any kind that impairs the individual's ability to drive or operate a motor vehicle safely Under the influence of a combination of alcohol and drugs that impairs the individual's ability to drive or operate a motor vehicle safely Driving after the driver's license was suspended or revoked for convictions pertaining to: Refusing to submit to a blood and/or breath test Driving while intoxicated Voluntary or involuntary manslaughter Leaving the scene of an accident that resulted in injury or death The terms of a restricted license

General Powers/Rules and Regulations, Orders

The State Corporation Commission (SCC) may also be referred to as the Commission, State Commission, or Bureau of Insurance. The SCC carries out all insurance laws in the Commonwealth of Virginia. The Commission regulates all companies that transact insurance in Virginia and has the authority to issue any rules and regulations required to administer and enforce insurance laws, and to issue certificates of authority to insurers.

Virginia Property Insurance Association (FAIR Plan)

The Virginia Property Insurance Association was formed to provide basic dwelling and commercial property insurance to individuals and businesses in the Commonwealth who are unable to obtain coverage through the voluntary insurance market. The FAIR Plan is made up of all insurers in the commonwealth that are licensed to write basic property insurance or similar coverages and is governed by a board of 15 directors. Under Virginia law, the FAIR plan is not an insurer. The FAIR Plan has the authority to: ---Hire and employ individuals and organizations necessary for carrying out its duties --Acquire, own, and sell real and personal property --Borrow funds, as needed, to carry out its duties in accordance with its plan of operation --Negotiate and become a party to contracts, as needed, to carry out its duties ---Purchase directors and officers liability insurance and indemnify its directors, officers, board of directors, employees, and agents for actions other than gross negligence and willful misconduct --Perform other activities as needed to carry out its duties

Exam and Application Fees

The examination fee will fall between $20-$100 and is due when the applicant registers for the exam. The applicant has to complete the exam within 90 days from their registration, or this fee will be forfeited. If an individual fails to pass the exam three times, they must wait 30 days before retaking the exam. Application The application for a license must be completed within 183 calendar days after passing the state licensing examination. The applicant must submit an application to the Commission in the form containing the information prescribed and pay a nonrefundable application processing fee of $10-$20 for each line of authority. At the time of application, the applicant must submit a full set of fingerprints for a background check through the FBI criminal database. Failing to submit the application appropriately will require the applicant to re-satisfy all prelicensing requirements, including examination, before re-applying for a license. If a nonresident producer becomes a resident of Virginia, they are not required to take an examination so long as they submit their application within 90 days of their previous license being cancelled. The applicant's home state must certify the applicant was in good standing at the time of cancellation. The Commission may also check the NAIC Producer Database records for indication that the producer's license was in good standing for the line of authority requested.

Licensing Requirements

The primary purpose of licensing insurance agents is to protect the public. To qualify for a producer's license, an applicant must be: At least 18 years old Of good character and have a reputation for honesty Compliant with residency and other requirements

Privacy Protection

These laws are in regard to the collection, use, and disclosure of information collected in connection with insurance transactions in personal lines of insurance. The purpose of these laws is to: ---Maintain a balance between the insurance industry's need for information and the public's need for fairness and minimal intrusion ---Enable individuals to understand what information can be, or has been, collected and provide them with access to information to verify or dispute that information ---Limit the disclosure of information ---Enable applicants and policyholders to obtain reasons for any adverse underwriting decisions Virginia laws pertaining to insurance information and privacy protection should not be interpreted to modify, limit, or replace the Fair Credit Reporting Act (FCRA)—which is federal legislation regulating the collection, use, and disclosure of consumer information.

Exemptions (Dwelling)

These laws concerning renewal, nonrenewal, and cancellation do not apply to: --Any policy covering an owner-occupied dwelling that was in force for fewer than 90 days on the date the nonrenewal or cancellation notice was sent --Any policy for which the insurer has issued a renewal policy, certificate of insurance, or other written offer to renew --Any policy for which:The insured has requested, verbally or in writing, that it be cancelled or nonrenewedThe insured refuses to accept the insurer's offer of renewal --Any policy written by the Virginia Property Insurance Association or any residual market facility in Virginia --Any policy for which an affiliate of the insurer is willing to provide coverage at a lower premium for the same coverages In Virginia, all personal lines property policies must contain, at the least, the precise provisions of the Standard Fire policy.

Towing and Labor Coverage

This endorsement provides towing and on-site labor coverage, up to the limit shown in the Declarations, but no less than $25 per disablement. This will pay up to the towing limit for each occurrence for covered autos or any non-owned auto.

Virginia Automobile Insurance Plan (Assigned Risk Pool)

Virginia Automobile Insurance Plan (VAIP) is an assigned risk pool that offers Automobile insurance through the residual market. It was formed to provide auto insurance to consumers in the commonwealth who are unable to obtain coverage through the voluntary insurance market. Every person unable to obtain a Motor Vehicle policy will have the right to apply to the State Corporation Commission to have their risk assigned to an insurance carrier licensed to write Motor Vehicle Liability insurance, which will meet the minimum required limits of $30,000/$60,000/$20,000. All insurers licensed to write auto insurance in Virginia must participate in the VAIP and risks are distributed equitably among the insurers. Consumers who hold a valid Virginia driver's license and own a motor vehicle registered in Virginia are eligible to be assigned coverage through VAIP if they have been unable to obtain auto insurance in the ordinary market. In addition, applicants who were not provided medical payments or physical damage coverage on their auto policies have the right to apply to have their auto insurance policy assigned through the VAIP. Once an Assigned Risk policy has been issued to an insured, the insurer must offer optional medical payments and disability income upon request of the insured and payment of premium. Coverage must be provided to the named insured, spouse, and relatives while living in the insured's household, and to persons occupying the insured motor vehicle. When licensed insurance agents submit applications for assignment through the VAIP, they will be randomly assigned and distributed to insurance companies based on a calculation that involves the amount of auto insurance business each insurer writes voluntarily in this state. The assignment of risks must also be available to nonresidents who are unable to obtain motor vehicle liability, physical damage, and medical payments insurance with respect to motor vehicles registered and used in the commonweal

Virginia Property and Casualty Insurance Guaranty Association

a nonprofit organization that consists of all licensed property and casualty (P&C) insurers in Virginia. Its purpose is to reduce the financial loss to residents in the event an insurance company becomes insolvent. Insurers must become and remain members of the Association as a condition of being able to obtain and maintain their licenses to transact insurance in Virginia. Operating Accounts The Association uses three separate operating accounts: ---Workers' Compensation insurance account ---Automobile insurance account ---Account for all other insurance Duties and Powers of the Association The Association is required to pay covered claims that existed before insolvency. Claims are covered up to 90 days after the determination of insolvency was made. Limits of Coverage The requirement to pay is satisfied when the Association pays the full amount of a Workers' Compensation claim, or up to $300,000 per claimant for all other covered claims. The Association is only required to pay unearned premiums in excess of $50. The Association assumes all the rights, duties, and obligations of an insolvent insurer and, in fact, is considered the insurer for those purposes. Assessments The assessment of each member insurer will be based on the ratio of that insurer's net direct written premiums to the net direct written premiums of all member insurers.

adverse underwriting decision

any of the following actions taken in response to an insurance transaction for an individually underwritten personal lines risk: --Refuse to issue a policy --Termination of insurance coverage --Failure of an agent to apply for insurance with a specific insurer, as requested by an applicant --Placement of insurance in the residual market or surplus lines market --Charge a higher rate based on information that is different from the information provided by the applicant/policyholder The following actions are not adverse underwriting decisions: --Terminating an individual policy form on a statewide basis or for an entire class of business --Declining coverage because it is not available on a statewide basis or as a class of business --Rescinding a policy (cancelling it on its effective date)

Notice of Information Practices Disclosure Limitations and Conditions

n insurance institution or agent cannot disclose medical records or privileged information about an individual that was collected or received in connection with an insurance transaction without written authorization from the individual. The authorization must be dated, signed by the individual, and obtained within 2 years prior to the date of the disclosure. An insurance institution or agent can disclose personal or privileged information about an individual received in connection with an insurance transaction without written authorization if the disclosure is reasonably necessary to: ---Determine an individual's eligibility for an insurance benefit or payment ---Detect or prevent criminal activity, fraud, material misrepresentation, or material nondisclosure in connection with an insurance transaction ---Verify insurance coverage --Inform an individual of a medical problem they may not be aware of Information may be disclosed without written authorization from the individual to an insurance regulatory authority, law enforcement, or other government authority to protect the interests of the insurance institution or agent in preventing or prosecuting the perpetration of fraud or if it is reasonably believed that the individual has conducted illegal activities.