A. Every domestic insurer subject to the provisions of this chapter shall atall times have and maintain free and unencumbered admitted assets in anamount equal to the sum total of its reserve liabilities and minimum capitaland surplus, and no such insurer shall pledge, hypothecate, or otherwiseencumber its assets in an amount in excess of the amount of its surplus topolicyholders; nor shall such insurer pledge, hypothecate or otherwiseencumber more than five percent of its admitted assets. However, theCommission, upon written application, may approve the hypothecation orencumbrance of any of the assets of such an insurer in any amount upon adetermination that such hypothecation or encumbrance will not adverselyaffect the solvency of such insurer.
B. Any such insurer which pledges, hypothecates, or otherwise encumbers anyof its assets shall within ten days thereafter report in writing to theCommission the amount and identity of the assets so pledged, hypothecated, orencumbered and the terms and conditions of such transaction. In addition,each such insurer shall annually, or more often if required by theCommission, file with the Commission a statement sworn to by an executiveofficer of the insurer that (i) title to assets in an amount equal to thereserve liability and minimum capital and surplus of the insurer that are notpledged, hypothecated or otherwise encumbered is vested in the insurer, (ii)the only assets of the insurer that are pledged, hypothecated or otherwiseencumbered are as identified and reported in the sworn statement and no otherassets of the insurer are pledged, hypothecated or otherwise encumbered, and(iii) the terms and limitations of any such transaction of pledge,hypothecation or encumbrance are as reported in the sworn statement.
C. Any person who accepts a pledge, hypothecation or encumbrance of any assetof a domestic insurer as security for a debt or other obligation of suchinsurer not in accordance with the terms and limitations of this articleshall be deemed to have accepted such asset subject to a superior,preferential and automatically perfected lien in favor of claimants; however,such superior, preferential and automatically perfected lien in favor ofclaimants shall not apply to assets of a company in receivership pursuant toChapter 15 (§ 38.2-1500 et seq.) of this title, if the receiver approves thepledge, hypothecation or encumbrance of such assets.
D. In the event of involuntary or voluntary liquidation of any domesticinsurer subject to this chapter, claimants of such insurer shall have a priorand preferential claim against all assets of the insurer except those thathave been pledged, hypothecated or encumbered in accordance with the termsand limitations of this article. All claimants shall have equal status andtheir prior and preferential claim shall be superior to any claim or cause ofaction against the insurer by any person, corporation, association or legalentity.
A. Every domestic insurer subject to the provisions of this chapter shall atall times have and maintain free and unencumbered admitted assets in anamount equal to the sum total of its reserve liabilities and minimum capitaland surplus, and no such insurer shall pledge, hypothecate, or otherwiseencumber its assets in an amount in excess of the amount of its surplus topolicyholders; nor shall such insurer pledge, hypothecate or otherwiseencumber more than five percent of its admitted assets. However, theCommission, upon written application, may approve the hypothecation orencumbrance of any of the assets of such an insurer in any amount upon adetermination that such hypothecation or encumbrance will not adverselyaffect the solvency of such insurer.
B. Any such insurer which pledges, hypothecates, or otherwise encumbers anyof its assets shall within ten days thereafter report in writing to theCommission the amount and identity of the assets so pledged, hypothecated, orencumbered and the terms and conditions of such transaction. In addition,each such insurer shall annually, or more often if required by theCommission, file with the Commission a statement sworn to by an executiveofficer of the insurer that (i) title to assets in an amount equal to thereserve liability and minimum capital and surplus of the insurer that are notpledged, hypothecated or otherwise encumbered is vested in the insurer, (ii)the only assets of the insurer that are pledged, hypothecated or otherwiseencumbered are as identified and reported in the sworn statement and no otherassets of the insurer are pledged, hypothecated or otherwise encumbered, and(iii) the terms and limitations of any such transaction of pledge,hypothecation or encumbrance are as reported in the sworn statement.
C. Any person who accepts a pledge, hypothecation or encumbrance of any assetof a domestic insurer as security for a debt or other obligation of suchinsurer not in accordance with the terms and limitations of this articleshall be deemed to have accepted such asset subject to a superior,preferential and automatically perfected lien in favor of claimants; however,such superior, preferential and automatically perfected lien in favor ofclaimants shall not apply to assets of a company in receivership pursuant toChapter 15 (§ 38.2-1500 et seq.) of this title, if the receiver approves thepledge, hypothecation or encumbrance of such assets.
D. In the event of involuntary or voluntary liquidation of any domesticinsurer subject to this chapter, claimants of such insurer shall have a priorand preferential claim against all assets of the insurer except those thathave been pledged, hypothecated or encumbered in accordance with the termsand limitations of this article. All claimants shall have equal status andtheir prior and preferential claim shall be superior to any claim or cause ofaction against the insurer by any person, corporation, association or legalentity.
A. Every domestic insurer subject to the provisions of this chapter shall atall times have and maintain free and unencumbered admitted assets in anamount equal to the sum total of its reserve liabilities and minimum capitaland surplus, and no such insurer shall pledge, hypothecate, or otherwiseencumber its assets in an amount in excess of the amount of its surplus topolicyholders; nor shall such insurer pledge, hypothecate or otherwiseencumber more than five percent of its admitted assets. However, theCommission, upon written application, may approve the hypothecation orencumbrance of any of the assets of such an insurer in any amount upon adetermination that such hypothecation or encumbrance will not adverselyaffect the solvency of such insurer.
B. Any such insurer which pledges, hypothecates, or otherwise encumbers anyof its assets shall within ten days thereafter report in writing to theCommission the amount and identity of the assets so pledged, hypothecated, orencumbered and the terms and conditions of such transaction. In addition,each such insurer shall annually, or more often if required by theCommission, file with the Commission a statement sworn to by an executiveofficer of the insurer that (i) title to assets in an amount equal to thereserve liability and minimum capital and surplus of the insurer that are notpledged, hypothecated or otherwise encumbered is vested in the insurer, (ii)the only assets of the insurer that are pledged, hypothecated or otherwiseencumbered are as identified and reported in the sworn statement and no otherassets of the insurer are pledged, hypothecated or otherwise encumbered, and(iii) the terms and limitations of any such transaction of pledge,hypothecation or encumbrance are as reported in the sworn statement.
C. Any person who accepts a pledge, hypothecation or encumbrance of any assetof a domestic insurer as security for a debt or other obligation of suchinsurer not in accordance with the terms and limitations of this articleshall be deemed to have accepted such asset subject to a superior,preferential and automatically perfected lien in favor of claimants; however,such superior, preferential and automatically perfected lien in favor ofclaimants shall not apply to assets of a company in receivership pursuant toChapter 15 (§ 38.2-1500 et seq.) of this title, if the receiver approves thepledge, hypothecation or encumbrance of such assets.
D. In the event of involuntary or voluntary liquidation of any domesticinsurer subject to this chapter, claimants of such insurer shall have a priorand preferential claim against all assets of the insurer except those thathave been pledged, hypothecated or encumbered in accordance with the termsand limitations of this article. All claimants shall have equal status andtheir prior and preferential claim shall be superior to any claim or cause ofaction against the insurer by any person, corporation, association or legalentity.
