{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/38.2-1904.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/38.2-1904.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/38.2-1904.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/38.2-1904.html"}],"law_id":68129,"edition_id":1,"section_id":68129,"structure_id":13456,"section_number":"38.2-1904","catch_line":"Rate standards","history":"1973, c. 504, \u00a7 38.1-279.33; 1975, c. 155; 1977, c. 415; 1981, c. 243; 1982, c. 226; 1986, c. 562; 1987, c. 697; 1991, c. 104; 1993, c. 985; 1996, c. 250; 2002, c. 145; 2015, cc. 502, 503.","full_text":"A\n\nRates for the classes of insurance to which this chapter applies shall not be excessive, inadequate, or unfairly discriminatory. All rates and all changes and amendments to rates to which this chapter applies for use in this Commonwealth shall consider loss experience and other factors within Virginia if relevant and actuarially sound, provided that other data, including countrywide, regional, or other state data, may be considered where such data is relevant and where a sound actuarial basis exists for considering data other than Virginia-specific data.1\n\nNo rate shall be held to be excessive unless it is unreasonably high for the insurance provided and a reasonable degree of competition does not exist in the area with respect to the classification to which the rate applies.2\n\nNo rate shall be held inadequate unless it is unreasonably low for the insurance provided and (i) continued use of it would endanger solvency of the insurer or (ii) use of the rate by the insurer has or, if continued, will have the effect of destroying competition or creating a monopoly.3\n\nNo rate shall be unfairly discriminatory if a different rate is charged for the same coverage and the rate differential (i) is based on sound actuarial principles or (ii) is related to actual or reasonably anticipated experience.B\n\n1. In determining whether rates comply with the standards of subsection A, separate consideration shall be given to (i) past and prospective loss experience within and outside this Commonwealth, (ii) conflagration or catastrophe hazards, (iii) a reasonable margin for underwriting profit and contingencies, (iv) dividends, savings or unabsorbed premium deposits allowed or returned by insurers to their policyholders, members or subscribers, (v) past and prospective expenses both countrywide and those specifically applicable to this Commonwealth, (vi) the loss reserving practices, standards and procedures utilized by the insurer, (vii) investment income earned or realized by insurers from their unearned premium and loss reserve and the Commission may give separate consideration to investment income earned on surplus funds, and (viii) all other relevant factors within and outside this Commonwealth. When actual experience or data does not exist, the Commission may consider estimates.2\n\nIn the case of fire insurance rates, consideration shall be given to the experience of the fire insurance business during a period of not less than the most recent five-year period for which such experience is available.3\n\nIn the case of workers’ compensation insurance rates for volunteer firefighters or volunteer emergency medical services personnel, the rates shall be calculated based upon the combined experience of both volunteer firefighters or volunteer emergency medical services personnel and paid firefighters or paid emergency medical services personnel, so that the resulting rate is the same for both volunteer and paid members, but in no event shall resulting premiums be less than $40 per year for any volunteer firefighter or volunteer emergency medical services personnel.4\n\nIn the case of uninsured motorist coverage required by subsection A of § 38.2-2206, consideration shall be given to all sums distributed by the Commission from the Uninsured Motorists Fund in accordance with the provisions of Chapter 30 (§ 38.2-3000 et seq.).C\n\nFor the classes of insurance to which this chapter applies, including insurance against contingent, consequential and indirect losses as defined in § 38.2-133 (i) the systems of expense provisions included in the rates for use by any insurer or group of insurers may differ from those of other insurers or groups of insurers to reflect the requirements of the operating methods of any such insurer or group for any class of insurance, or with respect to any subdivision or combination of insurance for which separate expense provisions are applicable, and (ii) risks may be grouped by classifications for the establishment of rates and minimum premiums. Classification rates may be modified to produce rates for individual risks in accordance with rating plans that establish standards for measuring variations in hazards, expense provisions, or both. The standards may measure any difference between risks that can be demonstrated to have a probable effect upon losses or expenses. Notwithstanding any other provision of this subsection, except as permitted by § 38.2-1908, each member of a rate service organization shall use the uniform classification system, uniform experience rating plan, and uniform statistical plan of its designated rate service organization in the provision of insurance defined in § 38.2-119.D\n\nNo insurer shall use any information pertaining to any motor vehicle conviction or accident to produce increased or surcharged rates above their filed manual rates for individual risks for a period longer than 36 months. This period shall begin no later than 12 months after the date of the conviction or accident.E\n\nEach authorized insurer subject to the provisions of this chapter may file with the Commission an expense reduction plan that permits variations in expense provisions. Such filing may contain provisions permitting agents to reduce their commission resulting in an appropriate reduction in premium. Nothing in this section shall be construed to require an agent to reduce a commission, nor may an insurer unreasonably refuse to reduce a premium due to a commission reduction as permitted by its filed expense reduction plan.","order_by":null,"text":{"0":{"id":246623,"text":"Rates for the classes of insurance to which this chapter applies shall not be excessive, inadequate, or unfairly discriminatory. All rates and all changes and amendments to rates to which this chapter applies for use in this Commonwealth shall consider loss experience and other factors within Virginia if relevant and actuarially sound, provided that other data, including countrywide, regional, or other state data, may be considered where such data is relevant and where a sound actuarial basis exists for considering data other than Virginia-specific data.","type":"section","prefixes":["A"],"prefix":"A","entire_prefix":"A","prefix_anchor":"A","level":1,"next_prefix":"A1"},"1":{"id":246624,"text":"No rate shall be held to be excessive unless it is unreasonably high for the insurance provided and a reasonable degree of competition does not exist in the area with respect to the classification to which the rate applies.","type":"section","prefixes":["A","1"],"prefix":"1","entire_prefix":"A1","prefix_anchor":"A1","level":2,"prior_prefix":"A","next_prefix":"A2"},"2":{"id":246625,"text":"No rate shall be held inadequate unless it is unreasonably low for the insurance provided and (i) continued use of it would endanger solvency of the insurer or (ii) use of the rate by the insurer has or, if continued, will have the effect of destroying competition or creating a monopoly.","type":"section","prefixes":["A","2"],"prefix":"2","entire_prefix":"A2","prefix_anchor":"A2","level":2,"prior_prefix":"A1","next_prefix":"A3"},"3":{"id":246626,"text":"No rate shall be unfairly discriminatory if a different rate is charged for the same coverage and the rate differential (i) is based on sound actuarial principles or (ii) is related to actual or reasonably anticipated experience.","type":"section","prefixes":["A","3"],"prefix":"3","entire_prefix":"A3","prefix_anchor":"A3","level":2,"prior_prefix":"A2","next_prefix":"B"},"4":{"id":246627,"text":"1. In determining whether rates comply with the standards of subsection A, separate consideration shall be given to (i) past and prospective loss experience within and outside this Commonwealth, (ii) conflagration or catastrophe hazards, (iii) a reasonable margin for underwriting profit and contingencies, (iv) dividends, savings or unabsorbed premium deposits allowed or returned by insurers to their policyholders, members or subscribers, (v) past and prospective expenses both countrywide and those specifically applicable to this Commonwealth, (vi) the loss reserving practices, standards and procedures utilized by the insurer, (vii) investment income earned or realized by insurers from their unearned premium and loss reserve and the Commission may give separate consideration to investment income earned on surplus funds, and (viii) all other relevant factors within and outside this Commonwealth. When actual experience or data does not exist, the Commission may consider estimates.","type":"section","prefixes":["B"],"prefix":"B","entire_prefix":"B","prefix_anchor":"B","level":1,"prior_prefix":"A3","next_prefix":"B2"},"5":{"id":246628,"text":"In the case of fire insurance rates, consideration shall be given to the experience of the fire insurance business during a period of not less than the most recent five-year period for which such experience is available.","type":"section","prefixes":["B","2"],"prefix":"2","entire_prefix":"B2","prefix_anchor":"B2","level":2,"prior_prefix":"B","next_prefix":"B3"},"6":{"id":246629,"text":"In the case of workers’ compensation insurance rates for volunteer firefighters or volunteer emergency medical services personnel, the rates shall be calculated based upon the combined experience of both volunteer firefighters or volunteer emergency medical services personnel and paid firefighters or paid emergency medical services personnel, so that the resulting rate is the same for both volunteer and paid members, but in no event shall resulting premiums be less than $40 per year for any volunteer firefighter or volunteer emergency medical services personnel.","type":"section","prefixes":["B","3"],"prefix":"3","entire_prefix":"B3","prefix_anchor":"B3","level":2,"prior_prefix":"B2","next_prefix":"B4"},"7":{"id":246630,"text":"In the case of uninsured motorist coverage required by subsection A of § 38.2-2206, consideration shall be given to all sums distributed by the Commission from the Uninsured Motorists Fund in accordance with the provisions of Chapter 30 (§ 38.2-3000 et seq.).","type":"section","prefixes":["B","4"],"prefix":"4","entire_prefix":"B4","prefix_anchor":"B4","level":2,"prior_prefix":"B3","next_prefix":"C"},"8":{"id":246631,"text":"For the classes of insurance to which this chapter applies, including insurance against contingent, consequential and indirect losses as defined in § 38.2-133 (i) the systems of expense provisions included in the rates for use by any insurer or group of insurers may differ from those of other insurers or groups of insurers to reflect the requirements of the operating methods of any such insurer or group for any class of insurance, or with respect to any subdivision or combination of insurance for which separate expense provisions are applicable, and (ii) risks may be grouped by classifications for the establishment of rates and minimum premiums. Classification rates may be modified to produce rates for individual risks in accordance with rating plans that establish standards for measuring variations in hazards, expense provisions, or both. The standards may measure any difference between risks that can be demonstrated to have a probable effect upon losses or expenses. Notwithstanding any other provision of this subsection, except as permitted by § 38.2-1908, each member of a rate service organization shall use the uniform classification system, uniform experience rating plan, and uniform statistical plan of its designated rate service organization in the provision of insurance defined in § 38.2-119.","type":"section","prefixes":["C"],"prefix":"C","entire_prefix":"C","prefix_anchor":"C","level":1,"prior_prefix":"B4","next_prefix":"D"},"9":{"id":246632,"text":"No insurer shall use any information pertaining to any motor vehicle conviction or accident to produce increased or surcharged rates above their filed manual rates for individual risks for a period longer than 36 months. This period shall begin no later than 12 months after the date of the conviction or accident.","type":"section","prefixes":["D"],"prefix":"D","entire_prefix":"D","prefix_anchor":"D","level":1,"prior_prefix":"C","next_prefix":"E"},"10":{"id":246633,"text":"Each authorized insurer subject to the provisions of this chapter may file with the Commission an expense reduction plan that permits variations in expense provisions. Such filing may contain provisions permitting agents to reduce their commission resulting in an appropriate reduction in premium. Nothing in this section shall be construed to require an agent to reduce a commission, nor may an insurer unreasonably refuse to reduce a premium due to a commission reduction as permitted by its filed expense reduction plan.","type":"section","prefixes":["E"],"prefix":"E","entire_prefix":"E","prefix_anchor":"E","level":1,"prior_prefix":"D"}},"ancestry":[{"id":13456,"edition_id":1,"name":"Regulation of Rates Generally","identifier":"19","label":"chapter","depth":2,"order_by":1,"parent_id":12698,"metadata":{},"date_created":"2026-06-26 03:44:55","date_modified":"2026-06-26 03:44:55","permalink":{"id":212945,"object_type":"structure","relational_id":13456,"identifier":"19","token":"38.2\/19","url":"\/38.2\/19\/","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":66229,"structure_id":13456,"section_number":"38.2-1900","catch_line":"Purposes of chapter","url":"\/38.2-1900\/","token":"38.2\/19\/38.2-1900","metadata":false},{"id":57539,"structure_id":13456,"section_number":"38.2-1901","catch_line":"Definitions","url":"\/38.2-1901\/","token":"38.2\/19\/38.2-1901","metadata":false},{"id":74191,"structure_id":13456,"section_number":"38.2-1902","catch_line":"Scope of chapter","url":"\/38.2-1902\/","token":"38.2\/19\/38.2-1902","metadata":false},{"id":70651,"structure_id":13456,"section_number":"38.2-1903","catch_line":"Exemptions","url":"\/38.2-1903\/","token":"38.2\/19\/38.2-1903","metadata":false},{"id":86657,"structure_id":13456,"section_number":"38.2-1903.1","catch_line":"Exemptions of large commercial risks","url":"\/38.2-1903.1\/","token":"38.2\/19\/38.2-1903.1","metadata":false},{"id":68129,"structure_id":13456,"section_number":"38.2-1904","catch_line":"Rate standards","url":"\/38.2-1904\/","token":"38.2\/19\/38.2-1904","metadata":false},{"id":57802,"structure_id":13456,"section_number":"38.2-1905","catch_line":"Motor vehicle insurer not to charge points or increase premiums in certain instances","url":"\/38.2-1905\/","token":"38.2\/19\/38.2-1905","metadata":false},{"id":80697,"structure_id":13456,"section_number":"38.2-1905.1","catch_line":"Repealed","url":"\/38.2-1905.1\/","token":"38.2\/19\/38.2-1905.1","metadata":false},{"id":70804,"structure_id":13456,"section_number":"38.2-1906","catch_line":"Filing and use of rates","url":"\/38.2-1906\/","token":"38.2\/19\/38.2-1906","metadata":false},{"id":54809,"structure_id":13456,"section_number":"38.2-1906.1","catch_line":"Misquote of premium","url":"\/38.2-1906.1\/","token":"38.2\/19\/38.2-1906.1","metadata":false},{"id":67605,"structure_id":13456,"section_number":"38.2-1907","catch_line":"Filings open to inspection","url":"\/38.2-1907\/","token":"38.2\/19\/38.2-1907","metadata":false},{"id":61334,"structure_id":13456,"section_number":"38.2-1908","catch_line":"Rate making and delegation of filing obligation","url":"\/38.2-1908\/","token":"38.2\/19\/38.2-1908","metadata":false},{"id":76329,"structure_id":13456,"section_number":"38.2-1909","catch_line":"Review of rates by Commission","url":"\/38.2-1909\/","token":"38.2\/19\/38.2-1909","metadata":false},{"id":64325,"structure_id":13456,"section_number":"38.2-1910","catch_line":"Disapproval of rates","url":"\/38.2-1910\/","token":"38.2\/19\/38.2-1910","metadata":false},{"id":63878,"structure_id":13456,"section_number":"38.2-1911","catch_line":"Special restrictions on individual insurers","url":"\/38.2-1911\/","token":"38.2\/19\/38.2-1911","metadata":false},{"id":77322,"structure_id":13456,"section_number":"38.2-1912","catch_line":"Delayed effect of rates; certification of reinsurance with affiliated company","url":"\/38.2-1912\/","token":"38.2\/19\/38.2-1912","metadata":false},{"id":76016,"structure_id":13456,"section_number":"38.2-1912.1","catch_line":"Approval of prospective loss costs and supplementary rate information; \u00a7 38.2-119 rate filings","url":"\/38.2-1912.1\/","token":"38.2\/19\/38.2-1912.1","metadata":false},{"id":73514,"structure_id":13456,"section_number":"38.2-1913","catch_line":"Operation and control of rate service organizations","url":"\/38.2-1913\/","token":"38.2\/19\/38.2-1913","metadata":false},{"id":68776,"structure_id":13456,"section_number":"38.2-1914","catch_line":"Licensing of rate service organizations","url":"\/38.2-1914\/","token":"38.2\/19\/38.2-1914","metadata":false},{"id":77780,"structure_id":13456,"section_number":"38.2-1915","catch_line":"Joint underwriting or joint reinsurance organizations","url":"\/38.2-1915\/","token":"38.2\/19\/38.2-1915","metadata":false},{"id":82148,"structure_id":13456,"section_number":"38.2-1916","catch_line":"Certain conduct by insurers and rate service organizations prohibited","url":"\/38.2-1916\/","token":"38.2\/19\/38.2-1916","metadata":false},{"id":75759,"structure_id":13456,"section_number":"38.2-1916.1","catch_line":"Investigation by Attorney General of suspected violations; investigative demand to witnesses; access to business records, etc.; penalties","url":"\/38.2-1916.1\/","token":"38.2\/19\/38.2-1916.1","metadata":false},{"id":54431,"structure_id":13456,"section_number":"38.2-1916.2","catch_line":"Penalties; injunctive relief; restitution","url":"\/38.2-1916.2\/","token":"38.2\/19\/38.2-1916.2","metadata":false},{"id":64311,"structure_id":13456,"section_number":"38.2-1917","catch_line":"Injunctive relief","url":"\/38.2-1917\/","token":"38.2\/19\/38.2-1917","metadata":false},{"id":64825,"structure_id":13456,"section_number":"38.2-1918","catch_line":"Agreements for equitable apportionment of insurance","url":"\/38.2-1918\/","token":"38.2\/19\/38.2-1918","metadata":false},{"id":62231,"structure_id":13456,"section_number":"38.2-1919","catch_line":"Collection of experience data; uniformity; compilations available to insurers and rate service organizations","url":"\/38.2-1919\/","token":"38.2\/19\/38.2-1919","metadata":false},{"id":72323,"structure_id":13456,"section_number":"38.2-1919.1","catch_line":"Interchange of rating data and information","url":"\/38.2-1919.1\/","token":"38.2\/19\/38.2-1919.1","metadata":false},{"id":60173,"structure_id":13456,"section_number":"38.2-1920","catch_line":"Excess rate for a specific risk","url":"\/38.2-1920\/","token":"38.2\/19\/38.2-1920","metadata":false},{"id":81510,"structure_id":13456,"section_number":"38.2-1921","catch_line":"Combination policies","url":"\/38.2-1921\/","token":"38.2\/19\/38.2-1921","metadata":false},{"id":61464,"structure_id":13456,"section_number":"38.2-1921.1","catch_line":"Professional employer organization workers' compensation rating","url":"\/38.2-1921.1\/","token":"38.2\/19\/38.2-1921.1","metadata":false},{"id":54416,"structure_id":13456,"section_number":"38.2-1922","catch_line":"No rule prohibiting or regulating payment of dividends, etc., to be adopted","url":"\/38.2-1922\/","token":"38.2\/19\/38.2-1922","metadata":false},{"id":73419,"structure_id":13456,"section_number":"38.2-1923","catch_line":"Person aggrieved by application of rating system to be heard; appeal to Commission","url":"\/38.2-1923\/","token":"38.2\/19\/38.2-1923","metadata":false},{"id":56103,"structure_id":13456,"section_number":"38.2-1924","catch_line":"Cooperation among rate service organizations, or among rate service organizations and insurers, authorized; review by Commission","url":"\/38.2-1924\/","token":"38.2\/19\/38.2-1924","metadata":false},{"id":77979,"structure_id":13456,"section_number":"38.2-1925","catch_line":"Examination of rate service organizations and joint underwriting and joint reinsurance organizations","url":"\/38.2-1925\/","token":"38.2\/19\/38.2-1925","metadata":false},{"id":67284,"structure_id":13456,"section_number":"38.2-1926","catch_line":"Action of Commission upon request for hearing on order or decision made without a hearing","url":"\/38.2-1926\/","token":"38.2\/19\/38.2-1926","metadata":false},{"id":62597,"structure_id":13456,"section_number":"38.2-1927","catch_line":"Withholding information; giving false or misleading information","url":"\/38.2-1927\/","token":"38.2\/19\/38.2-1927","metadata":false},{"id":73884,"structure_id":13456,"section_number":"38.2-1928","catch_line":"Violations of chapter","url":"\/38.2-1928\/","token":"38.2\/19\/38.2-1928","metadata":false}],"previous_section":{"id":86657,"structure_id":13456,"section_number":"38.2-1903.1","catch_line":"Exemptions of large commercial risks","url":"\/38.2-1903.1\/","token":"38.2\/19\/38.2-1903.1","metadata":false},"next_section":{"id":57802,"structure_id":13456,"section_number":"38.2-1905","catch_line":"Motor vehicle insurer not to charge points or increase premiums in certain instances","url":"\/38.2-1905\/","token":"38.2\/19\/38.2-1905","metadata":false},"metadata":false,"official_url":"https:\/\/law.lis.virginia.gov\/vacode\/38.2-1904\/","history_text":"

This law was first created in 1973. The record of its establishment is cataloged in chapter 504 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 1973 \u201cActs\u201d aren\u2019t available online. It has been modified 11 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 1975, chapter 155; in 1977, chapter 415; in 1981, chapter 243; in 1982, chapter 226; in 1986, chapter 562; in 1987, chapter 697; in 1991, chapter 104; in 1993, chapter 985; in 1996, chapter 250<\/a>; in 2002, chapter 145<\/a>; in 2015, chapters 502<\/a> and 503<\/a>.<\/p>","references":[{"id":70804,"section_number":"38.2-1906","catch_line":"Filing and use of rates","order_by":null,"url":"\/38.2-1906\/"},{"id":61334,"section_number":"38.2-1908","catch_line":"Rate making and delegation of filing obligation","order_by":null,"url":"\/38.2-1908\/"},{"id":76329,"section_number":"38.2-1909","catch_line":"Review of rates by Commission","order_by":null,"url":"\/38.2-1909\/"},{"id":64325,"section_number":"38.2-1910","catch_line":"Disapproval of rates","order_by":null,"url":"\/38.2-1910\/"},{"id":63878,"section_number":"38.2-1911","catch_line":"Special restrictions on individual insurers","order_by":null,"url":"\/38.2-1911\/"},{"id":76016,"section_number":"38.2-1912.1","catch_line":"Approval of prospective loss costs and supplementary rate information; \u00a7 38.2-119 rate filings","order_by":null,"url":"\/38.2-1912.1\/"},{"id":62231,"section_number":"38.2-1919","catch_line":"Collection of experience data; uniformity; compilations available to insurers and rate service organizations","order_by":null,"url":"\/38.2-1919\/"},{"id":73902,"section_number":"38.2-2126","catch_line":"Insurance credit score disclosure; use of credit information","order_by":null,"url":"\/38.2-2126\/"},{"id":55969,"section_number":"38.2-2213.1","catch_line":"Certain action prohibited when motor vehicle owner fails to allow access to recorded data from recording device","order_by":null,"url":"\/38.2-2213.1\/"},{"id":83935,"section_number":"38.2-2234","catch_line":"Insurance credit score disclosure; use of credit information","order_by":null,"url":"\/38.2-2234\/"},{"id":74863,"section_number":"38.2-2608","catch_line":"Home protection contracts; filing; form and contents; application or agreement to purchase; regulation of rates and charges","order_by":null,"url":"\/38.2-2608\/"},{"id":65425,"section_number":"38.2-5020.1","catch_line":"Credits against malpractice insurance premiums","order_by":null,"url":"\/38.2-5020.1\/"}],"refers_to":[{"id":85493,"section_number":"38.2-133","catch_line":"Contingent and consequential losses","order_by":null,"url":"\/38.2-133\/"},{"id":61334,"section_number":"38.2-1908","catch_line":"Rate making and delegation of filing obligation","order_by":null,"url":"\/38.2-1908\/"},{"id":76965,"section_number":"38.2-2206","catch_line":"Uninsured motorist insurance coverage","order_by":null,"url":"\/38.2-2206\/"},{"id":68536,"section_number":"38.2-3000","catch_line":"Supervision and control of Fund by Commission; payments from Fund","order_by":null,"url":"\/38.2-3000\/"}],"permalink":{"id":212967,"object_type":"law","relational_id":68129,"identifier":"38.2-1904","token":"38.2\/19\/38.2-1904","url":"\/38.2-1904\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/38.2-1904\/","token":"38.2\/19\/38.2-1904","dublin_core":{"Title":"Rate standards","Type":"Text","Format":"text\/html","Identifier":"\u00a7 38.2-1904","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

A.<\/span> Rates<\/span><\/span> for the classes of insurance<\/span> to which this chapter applies shall not be excessive, inadequate, or unfairly discriminatory. All rates<\/span><\/span> and all changes and amendments to rates<\/span><\/span> to which this chapter applies for use in this Commonwealth shall consider loss experience and other factors within Virginia if relevant and actuarially sound, provided that other data, including countrywide, regional, or other state<\/span> data, may be considered where such data is relevant and where a sound actuarial basis exists for considering data other than Virginia-specific data. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> No rate<\/span> shall be held to be excessive unless it is unreasonably high for the insurance<\/span> provided and a reasonable degree of competition does not exist in the area with respect to the classification<\/span> to which the rate<\/span> applies. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> No rate<\/span> shall be held inadequate unless it is unreasonably low for the insurance<\/span> provided and (i) continued use of it would endanger solvency of the insurer<\/span> or (ii) use of the rate<\/span> by the insurer<\/span> has or, if continued, will have the effect of destroying competition or creating a monopoly. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

3.<\/span> No rate<\/span> shall be unfairly discriminatory if a different rate<\/span> is charged for the same coverage and the rate<\/span> differential (i) is based on sound actuarial principles or (ii) is related to actual or reasonably anticipated experience. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

B.<\/span> 1. In determining whether rates<\/span><\/span> comply with the standards of subsection A, separate consideration shall be given to (i) past and prospective loss experience within and outside this Commonwealth, (ii) conflagration or catastrophe hazards, (iii) a reasonable margin for underwriting profit and contingencies, (iv) dividends, savings or unabsorbed premium deposits allowed or returned by insurers<\/span> to their policyholders, members or subscribers, (v) past and prospective expenses both countrywide and those specifically applicable to this Commonwealth, (vi) the loss reserving practices, standards and procedures utilized by the insurer<\/span>, (vii) investment income earned or realized by insurers<\/span> from their unearned premium and loss reserve and the Commission<\/span> may give separate consideration to investment income earned on surplus funds, and (viii) all other relevant factors within and outside this Commonwealth. When actual experience or data does not exist, the Commission<\/span> may consider estimates. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> In the case of fire insurance<\/span> rates<\/span><\/span>, consideration shall be given to the experience of the fire insurance<\/span> business during a period of not less than the most recent five-year period for which such experience is available. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

3.<\/span> In the case of workers’ compensation insurance<\/span> rates<\/span><\/span> for volunteer firefighters or volunteer emergency medical services personnel, the rates<\/span><\/span> shall be calculated based upon the combined experience of both volunteer firefighters or volunteer emergency medical services personnel and paid firefighters or paid emergency medical services personnel, so that the resulting rate<\/span> is the same for both volunteer and paid members, but in no event shall resulting premiums be less than $40 per year for any volunteer firefighter or volunteer emergency medical services personnel. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

4.<\/span> In the case of uninsured motorist coverage required by subsection A of § 38.2-2206<\/a>, consideration shall be given to all sums distributed by the Commission<\/span> from the Uninsured Motorists Fund in accordance with the provisions of Chapter 30 (§ 38.2-3000<\/a> et seq.). <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

C.<\/span> For the classes of insurance<\/span> to which this chapter applies, including insurance<\/span> against contingent, consequential and indirect losses as defined in § 38.2-133<\/a> (i) the systems of expense provisions included in the rates<\/span><\/span> for use by any insurer<\/span> or group of insurers<\/span> may differ from those of other insurers<\/span> or groups of insurers<\/span> to reflect the requirements of the operating methods of any such insurer<\/span> or group for any class of insurance<\/span>, or with respect to any subdivision or combination of insurance<\/span> for which separate expense provisions are applicable, and (ii) risks may be grouped by classifications<\/span> for the establishment of rates<\/span><\/span> and minimum premiums. Classification rates<\/span><\/span> may be modified to produce rates<\/span><\/span> for individual risks in accordance with rating plans that establish standards for measuring variations in hazards, expense provisions, or both. The standards may measure any difference between risks that can be demonstrated to have a probable effect upon losses or expenses. Notwithstanding any other provision of this subsection, except as permitted by § 38.2-1908<\/a>, each member of a rate service organization<\/span> shall use the uniform classification system<\/span>, uniform experience rating<\/span> plan, and uniform statistical plan<\/span> of its designated rate service organization<\/span> in the provision of insurance<\/span> defined in § 38.2-119<\/a>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

D.<\/span> No insurer<\/span> shall use any information pertaining to any motor vehicle conviction<\/span> or accident to produce increased or surcharged rates<\/span><\/span> above their filed manual rates<\/span><\/span> for individual risks for a period longer than 36 months. This period shall begin no later than 12 months after the date of the conviction<\/span> or accident. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

E.<\/span> Each authorized insurer<\/span> subject to the provisions of this chapter may file with the Commission<\/span> an expense reduction plan that permits variations in expense provisions. Such filing may contain provisions permitting agents to reduce their commission<\/span> resulting in an appropriate reduction in premium. Nothing in this section shall be construed to require an agent to reduce a commission<\/span>, nor may an insurer<\/span> unreasonably refuse to reduce a premium due to a commission<\/span> reduction as permitted by its filed expense reduction plan. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nRATE STANDARDS (\u00a7 38.2-1904)\n\nA. Rates for the classes of insurance to which this chapter applies shall not be\nexcessive, inadequate, or unfairly discriminatory. All rates and all changes and\namendments to rates to which this chapter applies for use in this Commonwealth\nshall consider loss experience and other factors within Virginia if relevant and\nactuarially sound, provided that other data, including countrywide, regional, or\nother state data, may be considered where such data is relevant and where a\nsound actuarial basis exists for considering data other than Virginia-specific\ndata.\n\n 1. No rate shall be held to be excessive unless it is unreasonably high for\n the insurance provided and a reasonable degree of competition does not exist\n in the area with respect to the classification to which the rate applies.\n\n 2. No rate shall be held inadequate unless it is unreasonably low for the\n insurance provided and (i) continued use of it would endanger solvency of the\n insurer or (ii) use of the rate by the insurer has or, if continued, will have\n the effect of destroying competition or creating a monopoly.\n\n 3. No rate shall be unfairly discriminatory if a different rate is charged for\n the same coverage and the rate differential (i) is based on sound actuarial\n principles or (ii) is related to actual or reasonably anticipated experience.\n\nB. 1. In determining whether rates comply with the standards of subsection A,\nseparate consideration shall be given to (i) past and prospective loss\nexperience within and outside this Commonwealth, (ii) conflagration or\ncatastrophe hazards, (iii) a reasonable margin for underwriting profit and\ncontingencies, (iv) dividends, savings or unabsorbed premium deposits allowed or\nreturned by insurers to their policyholders, members or subscribers, (v) past\nand prospective expenses both countrywide and those specifically applicable to\nthis Commonwealth, (vi) the loss reserving practices, standards and procedures\nutilized by the insurer, (vii) investment income earned or realized by insurers\nfrom their unearned premium and loss reserve and the Commission may give\nseparate consideration to investment income earned on surplus funds, and (viii)\nall other relevant factors within and outside this Commonwealth. When actual\nexperience or data does not exist, the Commission may consider estimates.\n\n 2. In the case of fire insurance rates, consideration shall be given to the\n experience of the fire insurance business during a period of not less than the\n most recent five-year period for which such experience is available.\n\n 3. In the case of workers’ compensation insurance rates for volunteer\n firefighters or volunteer emergency medical services personnel, the rates\n shall be calculated based upon the combined experience of both volunteer\n firefighters or volunteer emergency medical services personnel and paid\n firefighters or paid emergency medical services personnel, so that the\n resulting rate is the same for both volunteer and paid members, but in no\n event shall resulting premiums be less than $40 per year for any volunteer\n firefighter or volunteer emergency medical services personnel.\n\n 4. In the case of uninsured motorist coverage required by subsection A of\n § 38.2-2206, consideration shall be given to all sums distributed by the\n Commission from the Uninsured Motorists Fund in accordance with the provisions\n of Chapter 30 (§ 38.2-3000 et seq.).\n\nC. For the classes of insurance to which this chapter applies, including\ninsurance against contingent, consequential and indirect losses as defined in\n§ 38.2-133 (i) the systems of expense provisions included in the rates for\nuse by any insurer or group of insurers may differ from those of other insurers\nor groups of insurers to reflect the requirements of the operating methods of\nany such insurer or group for any class of insurance, or with respect to any\nsubdivision or combination of insurance for which separate expense provisions\nare applicable, and (ii) risks may be grouped by classifications for the\nestablishment of rates and minimum premiums. Classification rates may be\nmodified to produce rates for individual risks in accordance with rating plans\nthat establish standards for measuring variations in hazards, expense\nprovisions, or both. The standards may measure any difference between risks that\ncan be demonstrated to have a probable effect upon losses or expenses.\nNotwithstanding any other provision of this subsection, except as permitted by\n§ 38.2-1908, each member of a rate service organization shall use the\nuniform classification system, uniform experience rating plan, and uniform\nstatistical plan of its designated rate service organization in the provision of\ninsurance defined in § 38.2-119.\n\nD. No insurer shall use any information pertaining to any motor vehicle\nconviction or accident to produce increased or surcharged rates above their\nfiled manual rates for individual risks for a period longer than 36 months. This\nperiod shall begin no later than 12 months after the date of the conviction or\naccident.\n\nE. Each authorized insurer subject to the provisions of this chapter may file\nwith the Commission an expense reduction plan that permits variations in expense\nprovisions. Such filing may contain provisions permitting agents to reduce their\ncommission resulting in an appropriate reduction in premium. Nothing in this\nsection shall be construed to require an agent to reduce a commission, nor may\nan insurer unreasonably refuse to reduce a premium due to a commission reduction\nas permitted by its filed expense reduction plan.\n\nHISTORY: 1973, c. 504, \u00a7 38.1-279.33; 1975, c. 155; 1977, c. 415; 1981, c. 243;\n1982, c. 226; 1986, c. 562; 1987, c. 697; 1991, c. 104; 1993, c. 985; 1996, c.\n250; 2002, c. 145; 2015, cc. 502, 503.","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}}