ch 8 state laws

Notice Regarding Earthquake Exclusion

All insurers issuing new or renewal fire insurance policies or 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

Address/name change

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.

appointment of agents

Every licensed agent may sell policies and solicit applications for insurance as long as they have a contract and are licensed in that line of authority on behalf of the insurer even if they have not yet been validly appointed

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)

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.

records

must be retained from 1 year of transmittal or cancellation

if license revoked, suspended, denied must

wait 5 years from date of commissions order to reapply

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.

Penalties (same for cease and desist)

$5000 for each willful violation, unintentional violations $1000 each, max of $10,000 each (cease and desist have hearing 10 days after date served)

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

operating accounts

The Association uses three separate operating accounts: Workers' Compensation insurance account Automobile insurance account Account for all other insurance

Other Powers and Duties

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

minimal number of years available for inspection by state corp commission

3 years

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

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.

activities of unlicensed individuals

A license isn't required of a person whose employment responsibilities include enrolling individuals under a group insurance policy, provided that the person receives no commission or other valuable consideration for such enrollments, and that such compensation is not contingent upon the number of individuals enrolled or the amount of premium generated by such enrollments. 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.

probation, suspension, revocation, 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.

insurance consultant

An insurance consultant is an individual or business entity acting 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 as such Actuaries and CPAs who consult during the normal course of their businesses risk managers who only consult for their employees

disclosure limitation and conditions

An insurance institution or agent cannot disclose medical-record 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

appointment of agentsnsubject to

An insurer must, within 30 days of the date of execution of the first insurance application submitted by a licensed 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 submitted

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.

assumed names

Any individual or business entity conducting business under an assumed or fictitious name must notify the Bureau of Insurance of the name either at the time of application or within 30 calendar days from the date the assumed or fictitious name is adopted. When the insurance business is no longer conducted under an assumed or fictitious name, notification to the Bureau is required within 30 calendar days from when the assumed or fictitious name ceases to be used.

Notice Regarding Flood Exclusion

Any insurer that issues or delivers a new or renewal 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

ordinance or law

Any insurer that issues or delivers in Virginia a new or renewal contract or policy of fire insurance, or a new or renewal contract or policy of 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.

referrals

Any person who refers a customer who seeks 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

exemptions

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 nonrenewed The 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

Standard 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

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.

FAIR plan has 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

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.

Standard Property (Fire) Insurance Provisions

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

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.

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

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

can't cancel insurance policy unless it's for

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

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

Nonpayment of premium 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 insured Any driver who lives with the insured Any 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.

continuing education waivers

The Board may waive the requirements for the number of course hours to be completed within a biennium for "good cause," such as a long-term illness, or an emergency that prevents an agent from satisfying requirements. Requests for waivers must be submitted within 90 calendar days before the end of the applicable biennium.

examinations

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

Investigations

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.

State Corporation Commission/Commissioner of Insurance

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.

va automobile insurance plan (assigned risk pool)

The 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 $25,000/$50,000/$20,000. 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. 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.

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."

Virginia Property and Casualty Insurance Guaranty Association

The Virginia Property and Casualty Insurance Guaranty Association is a non-profit organization that consists of all licensed P&C insurers in Virginia. Its purpose is to reduce the financial loss to residents in the event an insurance company becomes insolvent. Member 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.

Licensing Requirements

The primary purpose of licensing insurance agents is to protect the public. An applicant must be: At least 18 years old Of good character and have a reputation for honesty Compliant with residency and other requirements The applicant must submit an application to the Commission in the form containing the information prescribed and pay a nonrefundable application processing fee. The application for a license must be completed within 183 calendar days after passing the state licensing examination. Failing to submit the application appropriately will require the applicant to re-satisfy all prelicensing requirements, including examination, before re-applying for a license.

uninsured motorist coverage

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

towing and labor costs coverage

This endorsement provides towing and on-site labor coverage of at least $25 per disablement.

qualified property

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

any Commission-approved organization that distributes fairly the responsibility to provide basic property insurance on qualified property among licensed insurers (i.e., the Virginia Property Insurance Association/FAIR Plan).

transportation expenses coverage

This endorsement covers expenses incurred due to loss to a covered auto, including temporary transportation expenses, with a required minimum limit of $600. This endorsement can be written to provide minimum $600 in transportation expenses, as well as 30 days of other incurred expenses.

Non-renewal notice

45 days before policy ends; can only renew 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

Nonresident License

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 are 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 submitted to their home state or a Uniform Application The applicant's home state issues nonresident agent licenses to residents of Virginia on the same basis

Twisting

A form of misrepresentation in which an agent persuades an insured/owner to cancel, lapse, or switch policies, even when it's to the insured's disadvantage.

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.

duration of the 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.

notice and review

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.

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.

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

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.

Rental Reimbursement

For any policy providing comprehensive or collision coverage, insurers must also offer the option to purchase rental reimbursement coverage.

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

Uninsured Private Watercraft Coverage

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

Exceptions to licensing

Officers, directors, or employees of an insurer or insurance producer employed in executive, administrative, managerial, and/or clerical capacities Employment that relates 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 non-resident is licensed to sell, solicit, or negotiate insurance in the state where its principal place of business is located

unfair discrimination

Permitting individuals of the same class and hazards 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 hazards 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

if not licenses as insurance consultant, 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

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

consultant must contract in writing with client and 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 (renew every year)

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.

state corp commission can probate, suspend, revoke, refuse or non renew because of these:

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 (using misrepresentation to induce an insured to terminate an existing policy and purchase a new policy) 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

not 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

to act as an agent means

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

insurance consultants must

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

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.

uninsured motorist coverage

The limits for uninsured motorist coverage can be no less than the minimum limits required by law as follows: $25,000 per person for bodily injury or death in any one accident $50,000 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 insured must communicate the desire to reduce coverage within 20 days of the mailing of the policy or premium notice.

financial responsibility

The minimum required limits for personal auto insurance in Virginia are $25,000 per person for bodily injury or death in any one accident $50,000 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

business entity 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

Underinsured Motorist Coverage

The policy insuring the motor vehicle occupied by the injured person The policy of the injured person, if he/she is 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 (i.e., the policy of a family member)

privacy protection

These laws are in regards 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.

medical expense and loss of income benefits

Virginia auto insurers must have two types of coverage for the occupants of an insured vehicle available for purchase: medical expense coverage and loss of income coverage. These coverages are available by endorsement on both commercial and personal auto policies. On personal policies, such coverage only applies to the named insured, spouse, and relatives residing in the same household while occupying, entering, or exiting the vehicle, or if struck by another motor vehicle as a pedestrian. Insureds must be able to buy one coverage and decline the other, or to decline both coverages. 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, or until the injured person resumes their usual occupation, or dies

omnibus clause

Virginia insurance law requires all liability policies insuring private passenger motor vehicles, aircraft, or private pleasure watercraft to contain an omnibus clause, extending coverage as a result of negligence of any operator with permission (expressed or implied) of the named insured to use the insured auto.

Fiduciary Responsibilities

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. A separate fiduciary account (i.e., 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. Misappropriating funds held in a fiduciary capacity may result in suspension or revocation of a license.

Cancellation and Nonrenewal of Personal Auto Policies

When cancelling a personal auto policy, 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

commission, compensation, fees

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 The State Commission may suspend a license if an agent shares commission with an unlicensed person

Resident Insurance Agent (Producer)

all applicants must pass test, after 3 failed attempts must wait 30 days, after failure to take test after 90 days its withdrawn. can't be agent without license. applicants must submit the license applications by 183 days after passing exam

aftermarket parts regulation

an insurer's repair estimate includes any aftermarket auto part (meaning 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:

personal information

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 medical-record information. Personal information does NOT include privileged information or information that is publicly available.

privileged information

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.

Continuing Education

complete licensing course every 2 years, administered by VA Continuing Education Board, 16 hours of approved continuing education course. agents who have more than one category required to complete 24 hours of relevant education 8 hours each class of insurance, 3 hours in each biennium must address topics of ethics. prohibited from more than 75% from insurers or agencies. required to show proof of compliance no later tha Dec 31 all CE fees non refundable( late penalty of $100) failure to provide means termination of license . failure to receive CE written notifications not grounds for contesting license termination (30 days). may apply for new license as non resident after 180 days in new state by 1 year

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 (or 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; and Failed to take corrective action or report the violation to the Commission

A nonresident agent or consultant who moves from one state to another must

file a change of address and provide a certification from the new home state within 30 calendar days of the change of legal residence. No fee or license application is required.

proof of residency

individual is considered a resident of Virginia provided 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 be deemed not to be 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

Adverse Underwriting Decision

is any of the following actions taken in response to an insurance transaction for an individually underwritten personal lines risk: Refusing 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 Charging a higher rate based on information that is different from the information provided by the applicant/policyholder

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.

powers of the commission

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

Rebating

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, 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, dividends)Receive or accept any of the following as an inducement for the purchase of a policy if it is not stated in the policy:

financial responsibility for certain offenses

not reinstate license or permit for 3 years until is double max limits of liability, $50,000/$100,000/$40,000, or driving at .08 blood alcohol content, under influence of drugs which makes impairment, suspended or revoked license

in 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

cancellation by insured

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.

Notice of Information Practices

provide notice in writing for insurance practices. must include 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

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

surplus lines licensing

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. 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 requirements.

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.