{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/38.2-1316.4.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/38.2-1316.4.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/38.2-1316.4.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/38.2-1316.4.html"}],"law_id":83595,"edition_id":1,"section_id":83595,"structure_id":15089,"section_number":"38.2-1316.4","catch_line":"Credit allowed any ceding insurer","history":"1991, c. 264; 2012, c. 539; 2017, c. 477; 2020, c. 208.","full_text":"Credit shall be allowed any ceding insurer under the following conditions:\n\n1\n\nCredit shall be allowed when reinsurance is ceded to an assuming insurer not meeting the requirements of § 38.2-1316.2 but only with respect to the insurance of risks located in jurisdictions where such reinsurance is required by applicable law or regulation of that jurisdiction.2\n\nCredit, in the form of a reduction from liability for reinsurance ceded to an assuming insurer not meeting the requirements of § 38.2-1316.2, shall be allowed in an amount not exceeding the liabilities carried by the ceding insurer and attributable to the reinsurance, provided that the Commission may adopt by regulation pursuant to subsection B of § 38.2-1316.7 specific additional requirements relating to or setting forth any one or more of the following: (i) the valuation of assets or reserve credits, (ii) the amount and forms of security supporting reinsurance arrangements described in subsection B of § 38.2-1316.7, and (iii) the circumstances pursuant to which credit will be reduced or eliminated. Additionally, such reduction shall not exceed the amount of funds held by or on behalf of the ceding insurer, including funds held in trust for the ceding insurer, under a reinsurance contract with such assuming insurer as security for the payment of obligations thereunder, if such security is (a) held in the United States subject to withdrawal solely by, and under the exclusive control of, the ceding insurer or (b) in the case of a trust, held in a qualified United States financial institution. The required security may be in the form of:\n\t\t\ta. Cash.\n\t\t\tb. Securities listed by the Securities Valuation Office of the NAIC, including those deemed exempt from filing as defined by the Purposes and Procedures Manual of the Investment Analysis Office, and qualifying as admitted assets with adequate liquidity and readily determinable market value.\n\t\t\tc. Clean, irrevocable, unconditional letters of credit issued or confirmed by a qualified United States financial institution, as defined in this article, no later than December 31 in respect of the year for which filing is being made, and in the possession of the ceding insurer on or before the filing date of its annual statement. Letters of credit meeting applicable standards of insurer acceptability as of the dates of their issuance (or confirmation) shall, notwithstanding the issuing (or confirming) institution’s subsequent failure to meet applicable standards of insurer acceptability, continue to be acceptable as security until their expiration, extension, renewal, modification or amendment, whichever first occurs.\n\t\t\td. Any other form of security acceptable to the Commission.","order_by":null,"text":{"0":{"id":299561,"text":"Credit shall be allowed any ceding insurer under the following conditions:","type":"section","prefixes":[""],"prefix":"","entire_prefix":"","prefix_anchor":"","level":1,"next_prefix":"1"},"1":{"id":299562,"text":"Credit shall be allowed when reinsurance is ceded to an assuming insurer not meeting the requirements of § 38.2-1316.2 but only with respect to the insurance of risks located in jurisdictions where such reinsurance is required by applicable law or regulation of that jurisdiction.","type":"section","prefixes":["1"],"prefix":"1","entire_prefix":"1","prefix_anchor":"1","level":1,"prior_prefix":"","next_prefix":"2"},"2":{"id":299563,"text":"Credit, in the form of a reduction from liability for reinsurance ceded to an assuming insurer not meeting the requirements of § 38.2-1316.2, shall be allowed in an amount not exceeding the liabilities carried by the ceding insurer and attributable to the reinsurance, provided that the Commission may adopt by regulation pursuant to subsection B of § 38.2-1316.7 specific additional requirements relating to or setting forth any one or more of the following: (i) the valuation of assets or reserve credits, (ii) the amount and forms of security supporting reinsurance arrangements described in subsection B of § 38.2-1316.7, and (iii) the circumstances pursuant to which credit will be reduced or eliminated. Additionally, such reduction shall not exceed the amount of funds held by or on behalf of the ceding insurer, including funds held in trust for the ceding insurer, under a reinsurance contract with such assuming insurer as security for the payment of obligations thereunder, if such security is (a) held in the United States subject to withdrawal solely by, and under the exclusive control of, the ceding insurer or (b) in the case of a trust, held in a qualified United States financial institution. The required security may be in the form of:\n\t\t\ta. Cash.\n\t\t\tb. Securities listed by the Securities Valuation Office of the NAIC, including those deemed exempt from filing as defined by the Purposes and Procedures Manual of the Investment Analysis Office, and qualifying as admitted assets with adequate liquidity and readily determinable market value.\n\t\t\tc. Clean, irrevocable, unconditional letters of credit issued or confirmed by a qualified United States financial institution, as defined in this article, no later than December 31 in respect of the year for which filing is being made, and in the possession of the ceding insurer on or before the filing date of its annual statement. Letters of credit meeting applicable standards of insurer acceptability as of the dates of their issuance (or confirmation) shall, notwithstanding the issuing (or confirming) institution’s subsequent failure to meet applicable standards of insurer acceptability, continue to be acceptable as security until their expiration, extension, renewal, modification or amendment, whichever first occurs.\n\t\t\td. Any other form of security acceptable to the Commission.","type":"section","prefixes":["2"],"prefix":"2","entire_prefix":"2","prefix_anchor":"2","level":1,"prior_prefix":"1"}},"ancestry":[{"id":15089,"edition_id":1,"name":"Reinsurance","identifier":"3.1","label":"article","depth":3,"order_by":1,"parent_id":13289,"metadata":{},"date_created":"2026-06-26 03:52:05","date_modified":"2026-06-26 03:52:05","permalink":{"id":211525,"object_type":"structure","relational_id":15089,"identifier":"3.1","token":"38.2\/13\/3.1","url":"\/38.2\/13\/3.1\/","edition_id":1,"permalink":0,"preferred":1}},{"id":13289,"edition_id":1,"name":"Reports, Reserves and Examinations, Insurance Holding Companies, Reinsurance Intermediaries, and Managing General Agents","identifier":"13","label":"chapter","depth":2,"order_by":1,"parent_id":12698,"metadata":{},"date_created":"2026-06-26 03:44:35","date_modified":"2026-06-26 03:44:35","permalink":{"id":211347,"object_type":"structure","relational_id":13289,"identifier":"13","token":"38.2\/13","url":"\/38.2\/13\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12698,"edition_id":1,"name":"Insurance","identifier":"38.2","label":"title","depth":1,"order_by":1,"parent_id":null,"metadata":{},"date_created":"2026-06-26 03:43:49","date_modified":"2026-06-26 03:43:49","permalink":{"id":210661,"object_type":"structure","relational_id":12698,"identifier":"38.2","token":"38.2","url":"\/38.2\/","edition_id":1,"permalink":0,"preferred":1}}],"structure_contents":[{"id":80624,"structure_id":15089,"section_number":"38.2-1316.1","catch_line":"Definitions","url":"\/38.2-1316.1\/","token":"38.2\/13\/3.1\/38.2-1316.1","metadata":false},{"id":57510,"structure_id":15089,"section_number":"38.2-1316.2","catch_line":"Credit allowed a domestic ceding insurer","url":"\/38.2-1316.2\/","token":"38.2\/13\/3.1\/38.2-1316.2","metadata":false},{"id":75917,"structure_id":15089,"section_number":"38.2-1316.3","catch_line":"Repealed","url":"\/38.2-1316.3\/","token":"38.2\/13\/3.1\/38.2-1316.3","metadata":false},{"id":83595,"structure_id":15089,"section_number":"38.2-1316.4","catch_line":"Credit allowed any ceding insurer","url":"\/38.2-1316.4\/","token":"38.2\/13\/3.1\/38.2-1316.4","metadata":false},{"id":60844,"structure_id":15089,"section_number":"38.2-1316.5","catch_line":"Repealed","url":"\/38.2-1316.5\/","token":"38.2\/13\/3.1\/38.2-1316.5","metadata":false},{"id":86117,"structure_id":15089,"section_number":"38.2-1316.7","catch_line":"Rules and regulations","url":"\/38.2-1316.7\/","token":"38.2\/13\/3.1\/38.2-1316.7","metadata":false},{"id":79104,"structure_id":15089,"section_number":"38.2-1316.8","catch_line":"Reinsurance agreements affected","url":"\/38.2-1316.8\/","token":"38.2\/13\/3.1\/38.2-1316.8","metadata":false}],"previous_section":{"id":75917,"structure_id":15089,"section_number":"38.2-1316.3","catch_line":"Repealed","url":"\/38.2-1316.3\/","token":"38.2\/13\/3.1\/38.2-1316.3","metadata":false},"next_section":{"id":60844,"structure_id":15089,"section_number":"38.2-1316.5","catch_line":"Repealed","url":"\/38.2-1316.5\/","token":"38.2\/13\/3.1\/38.2-1316.5","metadata":false},"metadata":false,"official_url":"https:\/\/law.lis.virginia.gov\/vacode\/38.2-1316.4\/","history_text":"

This law was first created in 1991. The record of its establishment is cataloged in chapter 264 of that year\u2019s edition of \u201cActs of Assembly,\u201d the annual state publication listing all changes made to the Code of Virginia in that year. Unfortunately, the 1991 \u201cActs\u201d aren\u2019t available online. It has been modified 3 times. Those modifications are cataloged by \u201cThe Acts of Assembly,\u201d a state publication, by year and chapter. Those modifications that can be read on the General Assembly\u2019s website will be linked accordingly. Those modifications are as follows: in 2012, chapter 539<\/a>; in 2017, chapter 477<\/a>; in 2020, chapter 208<\/a>.<\/p>","references":[{"id":80624,"section_number":"38.2-1316.1","catch_line":"Definitions","order_by":null,"url":"\/38.2-1316.1\/"},{"id":57510,"section_number":"38.2-1316.2","catch_line":"Credit allowed a domestic ceding insurer","order_by":null,"url":"\/38.2-1316.2\/"},{"id":67639,"section_number":"59.1-590","catch_line":"Conditions for a benefits consortium","order_by":null,"url":"\/59.1-590\/"},{"id":67346,"section_number":"6.2-952","catch_line":"Conditions for a benefits consortium","order_by":null,"url":"\/6.2-952\/"}],"refers_to":[{"id":57510,"section_number":"38.2-1316.2","catch_line":"Credit allowed a domestic ceding insurer","order_by":null,"url":"\/38.2-1316.2\/"},{"id":86117,"section_number":"38.2-1316.7","catch_line":"Rules and regulations","order_by":null,"url":"\/38.2-1316.7\/"}],"permalink":{"id":211539,"object_type":"law","relational_id":83595,"identifier":"38.2-1316.4","token":"38.2\/13\/3.1\/38.2-1316.4","url":"\/38.2-1316.4\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/38.2-1316.4\/","token":"38.2\/13\/3.1\/38.2-1316.4","dublin_core":{"Title":"Credit allowed any ceding insurer","Type":"Text","Format":"text\/html","Identifier":"\u00a7 38.2-1316.4","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

Credit<\/span> shall be allowed any ceding insurer<\/span> under the following conditions:<\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> Credit<\/span> shall be allowed when reinsurance is ceded to an assuming insurer<\/span> not meeting the requirements of § 38.2-1316.2<\/a> but only with respect to the insurance<\/span> of risks located in jurisdictions<\/span> where such reinsurance is required by applicable law<\/span> or regulation of that jurisdiction<\/span>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> Credit<\/span>, in the form of a reduction from liability for reinsurance ceded to an assuming insurer<\/span> not meeting the requirements of § 38.2-1316.2<\/a>, shall be allowed in an amount not exceeding the liabilities carried by the ceding insurer<\/span> and attributable to the reinsurance, provided that the Commission<\/span> may adopt by regulation pursuant to subsection B of § 38.2-1316.7<\/a> specific additional requirements relating to or setting forth any one or more of the following: (i) the valuation of assets<\/span> or reserve credits<\/span>, (ii) the amount and forms of security supporting reinsurance arrangements described in subsection B of § 38.2-1316.7<\/a>, and (iii) the circumstances pursuant to which credit<\/span> will be reduced or eliminated. Additionally, such reduction shall not exceed the amount of funds held by or on behalf of the ceding insurer<\/span>, including funds held in trust for the ceding insurer<\/span>, under a reinsurance contract<\/span> with such assuming insurer<\/span> as security for the payment of obligations thereunder, if such security is (a) held in the United States<\/span> subject to withdrawal solely by, and under the exclusive control of, the ceding insurer<\/span> or (b) in the case of a trust, held in a qualified United States<\/span> financial institution. The required security may be in the form of:\n\t\t\ta. Cash.\n\t\t\tb. Securities listed by the Securities Valuation Office of the NAIC<\/span>, including those deemed exempt from filing as defined by the Purposes and Procedures Manual of the Investment Analysis Office, and qualifying as admitted assets<\/span> with adequate liquidity and readily determinable market value.\n\t\t\tc. Clean, irrevocable, unconditional letters of credit<\/span> issued or confirmed by a qualified United States<\/span> financial institution, as defined in this article, no later than December 31 in respect of the year for which filing is being made, and in the possession<\/span> of the ceding insurer<\/span> on or before the filing date of its annual statement. Letters of credit<\/span> meeting applicable standards of insurer<\/span> acceptability as of the dates of their issuance (or confirmation) shall, notwithstanding the issuing (or confirming) institution’s subsequent failure to meet applicable standards of insurer<\/span> acceptability, continue to be acceptable as security until their expiration, extension, renewal, modification or amendment, whichever first occurs.\n\t\t\td. Any other form of security acceptable to the Commission<\/span>. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nCREDIT ALLOWED ANY CEDING INSURER (\u00a7 38.2-1316.4)\n\nCredit shall be allowed any ceding insurer under the following conditions:\n\n1. Credit shall be allowed when reinsurance is ceded to an assuming insurer not\nmeeting the requirements of § 38.2-1316.2 but only with respect to the\ninsurance of risks located in jurisdictions where such reinsurance is required\nby applicable law or regulation of that jurisdiction.\n\n2. Credit, in the form of a reduction from liability for reinsurance ceded to an\nassuming insurer not meeting the requirements of § 38.2-1316.2, shall be\nallowed in an amount not exceeding the liabilities carried by the ceding insurer\nand attributable to the reinsurance, provided that the Commission may adopt by\nregulation pursuant to subsection B of § 38.2-1316.7 specific additional\nrequirements relating to or setting forth any one or more of the following: (i)\nthe valuation of assets or reserve credits, (ii) the amount and forms of\nsecurity supporting reinsurance arrangements described in subsection B of §\n38.2-1316.7, and (iii) the circumstances pursuant to which credit will be\nreduced or eliminated. Additionally, such reduction shall not exceed the amount\nof funds held by or on behalf of the ceding insurer, including funds held in\ntrust for the ceding insurer, under a reinsurance contract with such assuming\ninsurer as security for the payment of obligations thereunder, if such security\nis (a) held in the United States subject to withdrawal solely by, and under the\nexclusive control of, the ceding insurer or (b) in the case of a trust, held in\na qualified United States financial institution. The required security may be in\nthe form of:\n\t\t\ta. Cash.\n\t\t\tb. Securities listed by the Securities Valuation Office of the NAIC,\nincluding those deemed exempt from filing as defined by the Purposes and\nProcedures Manual of the Investment Analysis Office, and qualifying as admitted\nassets with adequate liquidity and readily determinable market value.\n\t\t\tc. Clean, irrevocable, unconditional letters of credit issued or confirmed by\na qualified United States financial institution, as defined in this article, no\nlater than December 31 in respect of the year for which filing is being made,\nand in the possession of the ceding insurer on or before the filing date of its\nannual statement. Letters of credit meeting applicable standards of insurer\nacceptability as of the dates of their issuance (or confirmation) shall,\nnotwithstanding the issuing (or confirming) institution’s subsequent\nfailure to meet applicable standards of insurer acceptability, continue to be\nacceptable as security until their expiration, extension, renewal, modification\nor amendment, whichever first occurs.\n\t\t\td. Any other form of security acceptable to the Commission.\n\nHISTORY: 1991, c. 264; 2012, c. 539; 2017, c. 477; 2020, c. 208.","edition":{"id":1,"name":"2025","slug":"2025","date_created":"2026-06-21 22:39:22","date_modified":"2026-06-21 22:39:22","current":1,"order_by":1,"last_import":null}}