38.2-1229 - Impaired reciprocals. - Virginia Statutes

§ 38.2-1229. Impaired reciprocals.

A. If (i) the assets of a domestic reciprocal are at any time insufficient tosettle the sum of its liabilities, except those on account of fundscontributed by the attorney or other parties, and its required surplus topolicyholders, and (ii) the deficiency is not cured from other sources, itsattorney shall levy an assessment upon subscribers made subject to assessmentby the terms of their policies for the amount needed to make up thedeficiency. However, the assessment shall be subject to § 38.2-1212.

B. If the attorney fails to make the assessment within thirty days after theCommission orders him to do so, or if the deficiency is not fully made upwithin sixty days after the date the assessment was made, delinquencyproceedings may be instituted and conducted against the insurer as providedin Chapter 15 of this title.

C. If liquidation of the reciprocal is ordered, an assessment shall be leviedupon the subscribers for the amount the Commission or the court, as the casemay be, determines to be necessary to discharge all liabilities of thereciprocal. This assessment shall exclude any funds contributed by theattorney or other persons, but shall include the reasonable cost of theliquidation. However, the assessment shall be subject to § 38.2-1212.

(1952, c. 317, § 38.1-718; 1986, c. 562.)