                                 CODE OF VIRGINIA

REGISTRATION OF INSURERS THAT ARE MEMBERS OF HOLDING COMPANY SYSTEM (§
38.2-1329)

A. Each insurer licensed to do business in the Commonwealth that is a member of
an insurance holding company system shall register with the Commission.

B. 1. This section shall not apply to any foreign insurer subject to disclosure
requirements and standards adopted by statute or regulation in the jurisdiction
of its domicile that are substantially similar to those contained in this
section, subsection A of § 38.2-1330, subsection D of § 38.2-1330, §
38.2-1330.1, and either (i) a provision substantially similar to subsection B of
§ 38.2-1330 or (ii) a provision such as the following: &#8220;Each registered
insurer shall keep current the information required to be disclosed in its
registration statement by reporting all material changes or additions within 15
days after the end of the month in which it learns of each change or
addition.&#8221;

   2. Any insurer that is subject to registration under this section shall
   register within 15 days after it becomes subject to registration, and annually
   thereafter by April 30 of each year for the previous calendar year, unless the
   Commission for good cause shown extends the time for registration, and then
   within the extended time.

   3. Any licensed insurer that is a member of an insurance holding company
   system but not subject to registration under this section may be required by
   the Commission to furnish a copy of the registration statement, or other
   information filed by the insurer, with the insurance regulatory authority of
   its domiciliary jurisdiction.

C. Each insurer subject to registration under this section shall file a
registration statement on a form provided by the Commission. Such statement
shall contain current information on:

   1. The capital structure, general financial condition, ownership, and
   management of the insurer and any person controlling the insurer;

   2. The identity of every member of the insurance holding company system;

   3. The following agreements in force, continuing relationships and
   transactions currently outstanding between the insurer and its affiliates:
   				a. Loans, other investments, or purchases, sales or exchanges of
   securities of the affiliates by the insurer or of the insurer by its
   affiliates;
   				b. Purchases, sales, or exchanges of assets;
   				c. Transactions not in the ordinary course of business;
   				d. Guarantees or undertakings for the benefit of an affiliate that result
   in an actual contingent exposure of the insurer&#8217;s assets to liability,
   other than insurance contracts entered into in the ordinary course of the
   insurer&#8217;s business;
   				e. All management and service contracts and all cost-sharing arrangements;
   				f. Reinsurance agreements or other risk-sharing arrangements;
   				g. Dividends and other distributions to shareholders; and
   				h. Consolidated tax allocation agreements;

   4. Any pledge of the insurer&#8217;s stock, including stock of any subsidiary
   or controlling affiliate, for a loan made to any member of the insurance
   holding company system;

   5. If requested by the Commission, financial statements of or within an
   insurance holding company system, including all affiliates. Financial
   statements may include but are not limited to annual audited financial
   statements filed with the SEC pursuant to the Securities Act of 1933, as
   amended, or the Securities Exchange Act of 1934, as amended. An insurer
   required to file financial statements pursuant to this subdivision may satisfy
   the request by providing the Commission with the most recently filed parent
   corporation financial statements that have been filed with the SEC;

   6. Other matters relating to transactions between registered insurers and any
   affiliates which may be included from time to time in any registration forms
   adopted or approved by the Commission;

   7. Statements that the corporate governance and internal controls are managed
   under the direction of the insurer&#8217;s board of directors in a manner
   consistent with &#xA7; 13.1-673 or &#xA7; 13.1-853 as applicable, and that the
   insurer&#8217;s officers or senior management have approved, implemented, and
   continue to maintain and monitor corporate governance and internal control
   procedures; and

   8. Any other information required by the Commission by rule or regulation.

D. All registration statements shall contain a summary outlining all items in
the current registration statement representing changes from the prior
registration statement.

E. If information is not material for the purposes of this section, it need not
be disclosed on the registration statement filed pursuant to subsection C.
Unless the Commission prescribes otherwise and except for the purposes of
subsections M and N, sales, purchases, exchanges, loans or extensions of credit,
investments, or guarantees involving one-half of one percent or less of an
insurer&#8217;s admitted assets as of the immediately preceding December 31
shall not be deemed material for purposes of this section.

F. Each registered insurer shall report all additional material transactions
with affiliates and any material changes in previously reported material
transactions with affiliates on amendment forms provided by the Commission. Each
insurer shall make its report within 15 days after the end of the month in which
it learns of each additional material transaction or material change in material
transaction. Subject to § 38.2-1330.1, each insurer shall report to the
Commission all dividends and other distributions to shareholders within five
business days following their declaration, and such declaration shall confer no
rights upon shareholders until:

   1. The Commission has approved the payment of such dividend or distribution;
   or

   2. Thirty days after the Commission has received written notice of the
   declaration thereof and has not within such period disapproved such payment.
   				Each registered insurer shall also keep current the information required
   by subsection C by filing an amendment to its registration statement within
   120 days after the end of each fiscal year of the ultimate controlling person
   of the insurance holding company system.

G. The Commission shall terminate the registration of any insurer that
demonstrates it no longer is a member of an insurance holding company system.

H. The Commission may require or allow two or more affiliated insurers subject
to registration under this section to file a consolidated registration statement
or consolidated reports amending their consolidated registration statement or
their individual registration statements.

I. The Commission may allow an insurer that is authorized to do business in this
Commonwealth and that is part of an insurance holding company system to register
on behalf of any affiliated insurer required to register under subsection A and
to file all information and material required to be filed under this section.

J. The provisions of this section shall not apply to any insurer, information,
or transaction if and to the extent that the Commission by rule, regulation, or
order shall exempt the same from the provisions of this section.

K. Any person may file with the Commission a disclaimer of affiliation with any
authorized insurer. The disclaimer shall fully disclose all material
relationships and bases for affiliation between the person and the insurer as
well as the basis for disclaiming the affiliation. A disclaimer of affiliation
shall be deemed to have been granted unless the Commission, within 30 days
following receipt of a complete disclaimer, notifies the filing party the
disclaimer is disallowed. In the event of disallowance, the disclaiming party
may request a hearing. The disclaiming party shall be relieved of its duty to
register under this section if approval of the disclaimer has been granted by
the Commission or if the disclaimer is deemed to have been approved.

L. The ultimate controlling person of every insurer subject to registration
shall also file an annual enterprise risk report. The report shall be
appropriate to the nature, scale, and complexity of the operations of the
insurance holding company system, and shall, to the best of the ultimate
controlling person&#8217;s knowledge and belief, identify the material risks
within the insurance holding company system that could pose enterprise risk to
the insurer. The report shall be filed with the lead state commissioner.

M. Except as provided below, the ultimate controlling person of every insurer
subject to registration shall concurrently file with the registration an annual
group capital calculation as directed by the lead state commissioner. The report
shall be completed in accordance with the NAIC Group Capital Calculation
Instructions, which may permit the lead state commissioner to allow a
controlling person that is not the ultimate controlling person to file the group
capital calculation. The report shall be filled with the lead state commissioner
of the insurance holding company system. The following insurance holding company
systems are exempt from filing the group capital calculation:

   1. An insurance holding company system that has only one insurer within its
   holding company structure, that only writes business and is only licensed in
   its domestic state, and that assumes no business from any other insurer.

   2. Any insurance holding company system that is required to perform a group
   capital calculation specified by the Federal Reserve Board. The lead state
   commissioner shall request the calculation from the Federal Reserve Board
   under the terms of information sharing agreements in effect. However, if the
   Federal Reserve Board cannot share the calculation with the lead state
   commissioner, the insurance holding company shall not be exempt from filing
   the group capital calculation.

   3. An insurance holding company system whose non-U.S. group-wide supervisor is
   located within a reciprocal jurisdiction as described in subsection E of
   &#xA7; 38.2-1316.2 that recognizes the U.S. state regulatory approach to group
   supervision and group capital.

   4. An insurance holding system:
   				a. That provides information to the lead state that meets the requirements
   for accreditation under the NAIC financial standards and accreditation
   program, either directly or indirectly through the group-wide supervisor, who
   has determined such information is satisfactory to allow the lead state to
   comply with the NAIC group supervision approach, as detailed in the NAIC
   Financial Analysis Handbook; and
   				b. Whose non-U.S. group-wide supervisor that is not located in a
   reciprocal jurisdiction recognizes and accepts, as specified by the Commission
   in regulation, the group capital calculation as the worldwide group capital
   assessment for the U.S. insurance groups that operate in that jurisdiction.
   				Notwithstanding the exemptions provided for in subdivisions 3 and 4, a
   lead state commissioner shall require the group capital calculation for U.S.
   operations of any non-U.S.-based insurance holding company system where, after
   any necessary consultation with other supervisors or officials, it is deemed
   appropriate by the lead state commissioner for prudential oversight and
   solvency monitoring purposes or for ensuring the competitiveness of the
   insurance market.
   				Notwithstanding the exemptions provided for in subdivisions 1 through 4,
   the lead state commissioner has the discretion to exempt the ultimate
   controlling person from filing the annual group capital calculation or to
   accept a limited group capital filing or report in accordance with criteria as
   specified by the Commission in regulation.
   				If the lead state commissioner determines that an insurance holding
   company system no longer meets one or more of the requirements for an
   exemption specified in subdivisions 1 through 4, the insurance holding company
   system shall file the group capital calculation at the next annual filing date
   unless given an extension by the lead state commissioner based on reasonable
   grounds shown.

N. The ultimate controlling person of every insurer subject to registration and
scoped into the NAIC Liquidity Stress Test Framework shall file the results of a
specific year&#8217;s liquidity stress test. The filing shall be made to the
lead state commissioner of the insurance holding company system.

   1. Any change to the NAIC Liquidity Stress Test Framework or to the data year
   for which the scope criteria are to be measured shall be effective on January
   1 of the year following the calendar year when such changes are adopted.
   Insurers meeting at least one threshold of the scope criteria are considered
   scoped in the Framework for the specified data year unless the lead state
   commissioner, in consultation with the NAIC Financial Stability Task Force or
   its successor, determines the insurer should not be scoped into the Framework
   for that data year. Insurers that do not trigger at least one threshold of the
   scope criteria shall be considered scoped out of the Framework for the
   specified data year, unless the lead state commissioner, in consultation with
   the NAIC Financial Stability Task Force or its successor, determines the
   insurer should be scoped into the Framework for that data year.

   2. The performance of and filing of the results from a specific year&#8217;s
   liquidity stress test shall comply with Framework&#8217;s instructions and
   reporting templates for that year and any lead state commissioner
   determinations, in consultation with the NAIC Financial Stability Task Force
   or its successor, provided within the Framework.

O. The failure to file a registration statement or any summary of the
registration statement or enterprise risk filing required by this section within
the time specified for filing shall be a violation of this section.

HISTORY: 1973, c. 505, § 38.1-178.2; 1977, c. 414; 1986, c. 562; 1992, c. 588;
2000, c. 46; 2006, c. 577; 2009, c. 717; 2014, c. 309; 2022, c. 113.