                                 CODE OF VIRGINIA

DEFINITIONS (§ 38.2-1701)

As used in this chapter:
		&#8220;Account&#8221; means any one of the two accounts created under §
38.2-1702.
		&#8220;Association&#8221; means the Virginia Life, Accident and Sickness
Insurance Guaranty Association created under § 38.2-1702.
		&#8220;Authorized assessment&#8221; or the term &#8220;authorized&#8221; when
used in the context of assessments means that a resolution by the board of
directors has been passed whereby an assessment will be called immediately or in
the future from member insurers for a specified amount. An assessment is
authorized when the resolution is passed.
		&#8220;Benefit plan&#8221; means a specific employee, union, or association of
natural persons benefit plan.
		&#8220;Called assessment&#8221; or the term &#8220;called&#8221; when used in
the context of assessments means that a notice has been issued by the
Association to member insurers requiring that an authorized assessment be paid
within the time frame set forth within the notice. An authorized assessment
becomes a called assessment when notice is mailed by the Association to member
insurers.
		&#8220;Contractual obligation&#8221; means an obligation under a policy or
contract or certificate under a group policy or contract, or portion thereof for
which coverage is provided under § 38.2-1700.
		&#8220;Covered contract&#8221; or &#8220;covered policy&#8221; means a policy
or contract or portion of a policy or contract for which coverage is provided
under § 38.2-1700.
		&#8220;Extra-contractual claims&#8221; shall include, for example, claims
relating to bad faith in the payment of claims, punitive damages, or attorney
fees and costs.
		&#8220;Health benefit plan&#8221; means any hospital or medical expense policy
or certificate, or health maintenance organization subscriber contract or any
other similar health contract. &#8220;Health benefit plan&#8221; does not
include:

1. Accident only insurance;

2. Credit insurance;

3. Dental only insurance;

4. Vision only insurance;

5. Medicare Supplement insurance;

6. Benefits for long-term care, home health care, community-based care, or any
combination thereof;

7. Disability income insurance;

8. Coverage for on-site medical clinics; or

9. Specified disease, hospital confinement indemnity, or limited benefit health
insurance if the types of coverage do not provide coordination of benefits and
are provided under separate policies or certificates.
			&#8220;Impaired insurer&#8221; means a member insurer considered by the
Commission to be potentially unable to fulfill its contractual obligations.
			&#8220;Insolvent insurer&#8221; means a member insurer that is placed under
an order of liquidation by a court of competent jurisdiction with a finding of
insolvency.
			&#8220;Member insurer&#8221; means an insurer or health maintenance
organization licensed to transact in the Commonwealth any class of insurance or
health maintenance organization business to which this chapter applies under
&#xA7; 38.2-1700, including an insurer or health maintenance organization whose
license to transact the business of insurance in the Commonwealth has been
suspended, revoked, not renewed, or voluntarily withdrawn, but does not include
cooperative nonprofit life benefit companies, mutual assessment life, accident
and sickness insurance companies, burial societies, fraternal benefit societies,
dental and optometric services plans, and health services plans not subject to
this chapter pursuant to &#xA7; 38.2-4213.
			&#8220;Moody&#8217;s Corporate Bond Yield Average&#8221; means the Monthly
Average Corporates as published by Moody&#8217;s Investors Service, Inc., or any
successor thereto.
			&#8220;Owner&#8221; of a policy or contract or &#8220;policyholder,&#8221;
&#8220;policy owner,&#8221; and &#8220;contract owner&#8221; means the person
who is identified as the legal owner under the terms of the policy or contract
or who is otherwise vested with legal title to the policy or contract through a
valid assignment completed in accordance with the terms of the policy or
contract and properly recorded as the owner on the books of the member insurer.
The terms &#8220;owner,&#8221; &#8220;contract owner,&#8221;
&#8220;policyholder,&#8221; and &#8220;policy owner&#8221; do not include
persons with a mere beneficial interest in a policy or contract.
			&#8220;Plan sponsor&#8221; means (i) the employer, in the case of a benefit
plan established or maintained by a single employer; (ii) the employee
organization in the case of a benefit plan established or maintained by an
employee organization; or (iii) in the case of a benefit plan established or
maintained by two or more employers or jointly by one or more employers and one
or more employee organizations, the association, committee, joint board of
trustees, or other similar group of representatives of the parties who establish
or maintain the benefit plan.
			&#8220;Premiums&#8221; means amounts or considerations, by whatever name
called, received on covered policies or contracts, less any returned premiums,
considerations, and deposits and less dividends and experience credits.
&#8220;Premiums&#8221; does not include amounts or considerations received for
policies or contracts or for the portions of policies or contracts for which
coverage is not provided under subsection C of &#xA7; 38.2-1700 except that
assessable premium shall not be reduced on account of subdivision C 2 of &#xA7;
38.2-1700 relating to interest limitations and subdivision D 2 of &#xA7;
38.2-1700 relating to limitations with respect to one individual, one
participant, and one policy or contract owner. &#8220;Premiums&#8221; shall not
include (i) premiums for coverage in excess of $5 million on an unallocated
annuity contract covered under subdivisions D 2 d, e, and f of &#xA7; 38.2-1700
or (ii) with respect to multiple nongroup policies of life insurance owned by
one owner, whether the policy or contract owner is an individual, firm,
corporation, or other person, and whether the persons insured are officers,
managers, employees or other persons, premiums for coverage in excess of $5
million with respect to these policies or contracts, regardless of the number of
policies or contracts held by the owner.
			&#8220;Principal place of business&#8221; of a plan sponsor or a person other
than a natural person means the single state in which the natural persons who
establish policy for the direction, control, and coordination of the operations
of the entity as a whole primarily exercise that function, determined by the
Association in its reasonable judgment by considering the following factors: (i)
the state in which the primary executive and administrative headquarters of the
entity is located; (ii) the state in which the principal office of the chief
executive officer of the entity is located; (iii) the state in which the board
of directors (or similar governing person or persons) of the entity conducts the
majority of its meetings; (iv) the state from which the management of the
overall operations of the entity is directed; and in the case of a benefit plan
sponsored by affiliated companies comprising a consolidated corporation, the
state in which the holding company or controlling affiliate has its principal
place of business as determined using these factors. However, in the case of a
plan sponsor, if more than 50 percent of the participants in the benefit plan
are employed in a single state, that state shall be deemed to be the principal
place of business of the plan sponsor. The principal place of business of a plan
sponsor described in clause (iii) of the definition of plan sponsor in this
section shall be deemed to be the principal place of business of the
association, committee, joint board of trustees, or other similar group of
representatives of the parties who establish or maintain the benefit plan that,
in lieu of a specific or clear designation of a principal place of business,
shall be deemed to be the principal place of business of the employer or
employee organization that has the largest investment in the benefit plan in
question.
			&#8220;Receivership court&#8221; means the court in the insolvent or impaired
insurer&#8217;s state having jurisdiction over the conservation, rehabilitation,
or liquidation of the member insurer.
			&#8220;Resident&#8221; means a person to whom a contractual obligation is
owed and who resides in the Commonwealth on the date a member insurer becomes an
impaired insurer or a court order is entered that determines a member insurer to
be an insolvent insurer. A person may be a resident of only one state, which in
the case of a person other than a natural person shall be its principal place of
business. Citizens of the United States that are either (i) residents of foreign
countries, or (ii) residents of United States possessions, territories, or
protectorates that do not have an association similar to the Association, shall
be deemed residents of the state of domicile of the member insurer that issued
the policies or contracts.
			&#8220;Structured settlement annuity&#8221; means an annuity purchased in
order to fund periodic payments for a plaintiff or other claimant in payment for
or with respect to personal injury or sickness suffered by the plaintiff or
other claimant.
			&#8220;Supplemental contract&#8221; means a written agreement entered into
for the distribution of proceeds under a life, health, or annuity policy or
contract.
			&#8220;Unallocated annuity contract&#8221; means an annuity contract or group
annuity certificate that is not issued to and owned by an individual or a trust
created by an individual for the benefit of one or more individuals, except to
the extent of any annuity benefits guaranteed to an individual or such a trust
by an insurer under the contract or certificate.

HISTORY: 1976, c. 330, § 38.1-482.19; 1980, c. 186; 1986, c. 562; 2010, c. 510;
2015, c. 710; 2018, c. 706.