                                 CODE OF VIRGINIA

INSURED&#8217;S RIGHTS AND LIABILITIES; SETTLEMENTS BINDING ON RECEIVER OR
LIQUIDATOR; PRIORITY OF CLAIMS; STATEMENTS TO BE FILED WITH RECEIVER OR
LIQUIDATOR (§ 38.2-1609)

A. 1. Any person recovering under this chapter shall be deemed to have assigned
his rights under the policy to the Association to the extent of his recovery
from the Association. Each insured or claimant seeking the protection of this
chapter shall cooperate with the Association to the same extent as the person
would have been required to cooperate with the insolvent insurer. The
Association shall have no cause of action against the insured of the insolvent
insurer for any sums it has paid out except the causes of action the insolvent
insurer would have had if those sums had been paid by the insolvent insurer and
except as provided in subdivision 2 of this subsection. In the case of an
insolvent insurer operating on an assessment plan, payments of claims by the
Association shall not reduce the liability of insureds to the receiver,
liquidator, or statutory successor for unpaid assessments previously made.
However, the receiver, liquidator, or statutory successor shall under no
circumstances levy an additional assessment against the insured, regardless of
the terms of the policy.

   2. The Association shall have the right to recover from the following persons
   the amount of any &#8220;covered claim&#8221; paid on behalf of such persons
   pursuant to this chapter:
   				a. Any insured whose net worth on December 31 of the year next preceding
   the date the insurer becomes an insolvent insurer exceeds fifty million
   dollars and whose liability obligations to other persons are satisfied in
   whole or in part by payments made under this chapter; and
   				b. Any person who is an affiliate of the insolvent insurer and whose
   liability obligations to other persons are satisfied in whole or in part by
   payments made under this chapter.

B. The receiver, liquidator, or statutory successor of an insolvent insurer
shall be bound by settlements of covered claims by the Association or a similar
organization in another state. The court having jurisdiction shall grant those
claims priority equal to that which the claimant would have been entitled in the
absence of this chapter against the assets of the insolvent insurer. The
expenses of the Association or a similar organization incurred in handling
claims shall be accorded the same priority as the liquidator&#8217;s expenses.

C. The Association shall preserve its rights to the insolvent insurer by
periodically filing with the receiver or liquidator statements of the covered
claims paid by the Association and estimates of anticipated claims on the
Association.

HISTORY: 1970, c. 766, § 38.1-766; 1986, c. 562; 1987, c. 529.