State Codes and Statutes
Statutes > Virginia > Title-36 > Chapter-1-2 > 36-55-36-1§ 36-55.36:1. Power to create insurance funds and form corporations for thepurpose of insuring HDA mortgage loans.
HDA shall have the power to create one or more insurance funds and to formone or more corporations for the purpose of providing replacement mortgageguaranty insurance, upon such terms and conditions as HDA shall prescribe, onmortgage loans made or financed by HDA pursuant to this chapter for which (i)mortgage guaranty insurance is being provided by a company which, subsequentto the provision of such coverage, has experienced a drop in rating by anationally recognized credit rating service which could result in a ratingfor the bonds which would be in nonconformance with the rating covenants ofthe related bond indenture; and (ii) the executive director of HDA executesan affidavit stating that HDA was unable, after diligent effort, to procurereplacement mortgage guaranty insurance in a form and premium acceptable toHDA from another insurer licensed in this Commonwealth to transact mortgageguaranty insurance business. For purposes of this section, "diligenteffort" means a good faith search by HDA for mortgage guaranty insuranceamong admitted insurers resulting in declinations of coverage, by threeunaffiliated insurers licensed and authorized in this Commonwealth to writethe mortgage guaranty insurance coverage sought, at a premium equal to orless than the premium in force for the loans made or financed by HDA. HDAmay provide financing and other funding to any such fund or corporation andmay exercise all necessary or convenient rights and powers and perform allrequisite duties and obligations relating thereto. Any such fund orcorporation shall be subject to the direction and control of thecommissioners of HDA and shall have such powers and duties as thecommissioners of HDA shall prescribe. Any such fund or corporation maycharge such premiums and may establish such reserves as HDA shall specify.HDA may specify that any such reserves shall be assets of such fund orcorporation and shall not be subject to the claims of creditors of HDA. Anysuch fund or corporation, its directors, officers and employees, its assetsand operations, and its policies of insurance and the premiums therefor shallnot be subject to the provisions of Title 38.2 and rules and regulationsissued pursuant thereto. The property of any such fund or corporation andits income and operations shall be exempt from taxation or assessments ofevery kind by the Commonwealth and all municipalities and other politicalsubdivisions thereof. The provisions of § 36-55.36 shall not be applicableto mortgage guaranty insurance provided under this section.
(1990, c. 956.)
