                                 CODE OF VIRGINIA

DELAYED EFFECT OF RATES; CERTIFICATION OF REINSURANCE WITH AFFILIATED COMPANY
(§ 38.2-1912)

A. If the Commission finds in any class, line, or subdivision of insurance, or
in any rating class or rating territory or for insurance as defined in &#xA7;
38.2-119 that (i) competition is not an effective regulator of the rates
charged, (ii) Virginia loss experience and other factors specifically applicable
to the Commonwealth have not been properly used to determine the rate, (iii) a
substantial number of insurers are competing irresponsibly through the rates
charged, or (iv) there are widespread violations of this chapter, it shall
promulgate a rule requiring that any subsequent changes in the rates or
supplementary rate information for that class, line, subdivision, rating class
or rating territory shall be filed with the Commission at least sixty days
before they become effective. The Commission may extend the waiting period for
thirty additional days by written notice to the filer before the first sixty-day
period expires. Upon filing any rate to which this section is applicable, the
insurer shall give notice to the Division of Consumer Counsel of the Office of
the Attorney General that such rate has been filed with the Commission and such
insurer shall so certify to the Commission in its rate filing.

B. By this rule, the Commission may require the filing of supporting data for
any classes, lines or subdivisions of insurance, or classes of risks or
combinations thereof it deems necessary for the proper functioning of the rate
monitoring and regulating process.

C. A rule promulgated under this section shall expire no later than twenty-seven
months after issue. The Commission may renew the rule after a hearing and
appropriate findings under this section.

D. If a filing is not accompanied by the information the Commission has required
under subsection B of this section, the Commission shall within thirty days of
the initial filing inform the insurer that the filing is not complete, and the
filing shall be deemed to be made when the information is furnished.

E. If an insurer files for a rate reduction pursuant to a rule promulgated under
this section, the Commission may order the provisional use of the requested rate
reduction for such period as the Commission may require to evaluate the
insurer&#8217;s rate filing and supplementary rate information. The
implementation of such a provisional rate reduction shall not relieve an insurer
of its obligation to submit such information as deemed necessary by the
Commission for its consideration of the rate filing, nor shall it interfere with
the Commission&#8217;s authority to suspend use of the provisional rate,
reimpose the previous rate, consider and approve a revised rate request, or
otherwise exercise its authority under &#xA7; 38.2-1910.

F. Each insurer shall so certify in a rate filing if coverage to which the rate
filing applies is reinsured by another company (i) under common management, (ii)
under common controlling ownership, or (iii) under other common effective legal
control as defined in &#xA7; 38.2-1322.

HISTORY: 1973, c. 504, § 38.1-279.40; 1986, c. 562; 1987, c. 697; 1990, cc.
487, 597; 1993, c. 985.