§ 6.2-887 Insurance business of controlled subsidiary
A. In addition to the types of business authorized in § 6.2-885, a controlled subsidiary corporation that is a domestic or foreign corporation, the majority of the voting stock of which is owned, directly or indirectly, by (i) a bank or banks organized under the laws of the United States, (ii) a bank or banks organized under the laws of the Commonwealth, (iii) a bank or banks organized under the laws of another state, or (iv) a bank holding company owning a bank or banks in the Commonwealth or in another state, may be formed to:
1. Transact the type of insurance business specified in § 38.2-120 and other insurance normally written under the coverage known as financial institution blanket bonds;
2. Underwrite insurance indemnifying the bank, its holding companies or its affiliates, and their directors and officers against liability; and
3. Underwrite reinsurance of mortgage guaranty insurance, subject to such conditions as the Commission may impose, on loans secured by real estate made or purchased by such controlled reinsurance subsidiary’s affiliates or by a bank owning such controlled subsidiary.
B. Any such controlled subsidiary corporation shall (i) transact only the insurance business specifically permitted by this section and (ii) be subject to the further provisions of Title 38.2 otherwise applicable to insurance companies transacting a comparable business.
C. The investment of any bank in the stock, services, or other obligations of such a controlled subsidiary shall not exceed two percent of such bank’s capital, surplus, and undivided profits.
History
This law was first created in 1976. The record of its establishment is cataloged in chapter 340 of that year’s edition of “Acts of Assembly,” the annual state publication listing all changes made to the Code of Virginia in that year. Unfortunately, the 1976 “Acts” aren’t available online. It has been modified 4 times. Those modifications are cataloged by “The Acts of Assembly,” a state publication, by year and chapter. Those modifications that can be read on the General Assembly’s website will be linked accordingly. Those modifications are as follows: in 1977, chapter 190; in 1986, chapter 638; in 1998, chapter 48; in 2010, chapter 794.
1976, c. 340, § 6.1-58.2; 1977, c. 190; 1986, c. 638; 1998, c. 48; 2010, c. 794.