                                 CODE OF VIRGINIA

EXAMINATIONS; HOW CONDUCTED (§ 38.2-1318)

A. Whenever the Commission examines the affairs of any person, as set forth in
§ 38.2-1317, it may appoint as examiners one or more competent persons.

   1. To the extent practicable, the examiners shall be regular employees of the
   Commission.

   2. No examiner may be appointed by the Commission if such examiner, either
   directly or indirectly, has a conflict of interest or is affiliated with the
   management of or owns a pecuniary interest in any person subject to
   examination under this article; however, this section shall not be construed
   to automatically preclude an examiner from being:
   				a. A policyholder or claimant under an insurance policy;
   				b. A grantor of a mortgage or similar instrument on the examiner&#8217;s
   residence to a regulated entity if done under customary terms and in the
   ordinary course of business;
   				c. An investment owner in shares of regulated diversified investment
   companies; or
   				d. A settlor or beneficiary of a &#8220;blind trust&#8221; into which any
   otherwise impermissible holdings have been placed.

   3. Notwithstanding the requirements of this subsection, the Commission may
   retain from time to time, on an individual basis, qualified actuaries,
   certified public accountants, or other similar individuals or firms who are
   independently practicing their professions, even though said persons may from
   time to time be similarly employed or retained by persons subject to
   examination under this article.

B. The examiners shall be instructed as to the scope of the examination, and, in
conducting the examination, the examiner shall observe, to the extent
practicable, those guidelines and procedures set forth in the Examiners&#8217;
Handbook, or any successor publications, adopted by the NAIC and such other
guidelines or procedures as the Commission may deem appropriate.

C. Every company or person from whom information is sought, its officers,
directors, and agents shall provide the examiners convenient access at all
reasonable hours to its books, records, files, securities, accounts, papers,
documents, and any or all computer or other recordings relating to the property,
assets, business and affairs of the company being examined or those of any
person, including any affiliates or subsidiaries of the person examined, that
are relevant to the examination.

   1. The officers, directors, employees and agents of the company or person
   shall facilitate the examination and aid in the examination so far as it is in
   their power to do so.

   2. The refusal of any company, by its officers, directors, employees or
   agents, to submit to examination or to comply with any reasonable written
   request of the examiners shall be grounds for suspension or refusal of, or
   nonrenewal of, any license or authority held by the company to engage in an
   insurance or other business subject to the Commission&#8217;s jurisdiction.
   Any such proceedings for suspension, revocation or refusal of any license or
   authority shall be conducted pursuant to &#xA7; 38.2-1040.

D. For the purpose of any investigation or proceeding under this article, the
Commission or any individual designated by it may administer oaths and
affirmations, subpoena witnesses, compel their attendance, take evidence and
require the production of any books, papers, correspondence, memoranda,
agreements or other documents or records which the Commission determines are
relevant to the examination.

E. In connection with any examination, the Commission may retain attorneys,
appraisers, independent actuaries, independent certified public accountants,
security analysts or other professionals and specialists as examiners; the cost
of which shall be borne by the company which is the subject of the examination.

F. Nothing contained in this article shall be construed to limit the
Commission&#8217;s authority to terminate or suspend any examination in order to
pursue other legal or regulatory action pursuant to the provisions of this
title.

G. Nothing contained in this article shall be construed to limit the
Commission&#8217;s authority to use and, if appropriate, to make public any
final or preliminary examination report, any examiner or company workpapers or
other documents, or any other information discovered or developed during the
course of any examination in the furtherance of any legal or regulatory action
which the Commission may deem appropriate.

H. Whenever the Commission examines the affairs of any person providing benefits
pursuant to Title XIX or Title XXI of the Social Security Act, as amended, as
set forth in &#xA7; 38.2-1317, nothing contained in this article shall be
construed to limit the Commission&#8217;s authority to consult with the
Department of Medical Assistance Services about such person before taking any
action as a result of services the person provides pursuant to Title XIX or
Title XXI of the Social Security Act, as amended.

HISTORY: Code 1950, §§ 38-69, 38-125; 1952, c. 317, § 38.1-175; 1986, c. 562;
1992, c. 588; 2006, c. 866.