Virginia Code 38.2-2606: Reserves required
A home protection company licensed in this Commonwealth shall maintain reserves in an amount sufficient to provide for its liability to furnish appropriate indemnity, repairs, and replacement services under its issued and outstanding contracts. The reserve account shall be calculated according to sound actuarial principles, but shall equal at a minimum fifty percent of the premiums received from all contracts in force in this Commonwealth, net of applicable reinsurance and any amounts paid on account of liabilities incurred under the contracts. To receive credit for reinsurance on home protection contracts, the reinsurance contract or policy shall be issued by a solvent insurer licensed in this Commonwealth or any other state having standards of solvency at least equal to those required in this Commonwealth.
Terms Used In Virginia Code 38.2-2606
- Home protection company: means any person who performs, or arranges to perform, services pursuant to a home protection insurance contract. See Virginia Code 38.2-2600
- Insurer: means an insurance company. See Virginia Code 38.2-100
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- State: means any commonwealth, state, territory, district or insular possession of the United States. See Virginia Code 38.2-100
1981, c. 530, § 38.1-936; 1986, c. 562.