- Comments on Virginia's Insurance Holding Company Rulemaking Due By November 20, 2014
- October 30, 2014
- Law Firm: Colodny Fass P.A. - Fort Lauderdale Office
Rulemaking is underway on Virginia regulations governing insurance holding companies after the enactment of House Bill 109, which conforms Virginia law to the National Association of Insurance Commissioners' Insurance Holding Company Model Act.
Written requests by those seeking to submit comments or have a public hearing scheduled must be received by November 20, 2014 by Virginia's State Corporation Commission ("SCC"), which oversees the Virginia Bureau of Insurance.
The proposed Rules, which would amend Chapter 260, Title 14 of Virginia's Administrative Code, would add a related form and two new Rules, as well as revise existing forms. The proposed effective date is January 1, 2015.
Enacted March 27, 2014, HB 109 expands insurance regulators' examination authority to ascertain the financial condition of an insurer. The bill (i) requires the ultimate controlling person of an insurance holding company system to submit a confidential Enterprise Risk filing; (ii) requires the parent company seeking to divest its interest in an insurance company subsidiary to provide notice to the domestic regulator prior to the divestiture; (iii) requires the insurer's board of directors to make statements regarding the corporate governance and internal control responsibilities within the registration statement; (iv) subjects the cost-sharing services and management agreements among affiliated entities to minimum reporting requirements; and (v) adds confidentiality protections for information shared.
HB 109 also authorizes the SCC to participate in supervisory colleges, which will be used by regulators to coordinate supervision of an insurance holding company system that has national and international operations.
The measure also makes dental and optometric services plans subject to the new insurance holding company provisions, and dental plan organizations subject to risk-based capital requirements.
Of note, Virginia's insurance holding company requirements in effect as of June 30, 2014 will continue to apply to any insurance holding company transaction commenced prior to January 1, 2015, unless otherwise provided.