                                 CODE OF VIRGINIA

ESTABLISHMENT OF RESIDUAL MARKET FACILITY (§ 38.2-2702)

A. A residual market facility shall be established and maintained by all
insurers licensed to write basic property insurance or other insurance
containing a basic property insurance component. The plan of operation of the
residual market facility shall be subject to approval by the Commission.

B. The residual market facility shall be governed by a board of fifteen
directors. Four directors shall be appointed by the Commissioner, two of whom
shall be property and casualty insurance agents and two of whom shall be from
the general public.

C. The residual market facility shall have the power to:

   1. Employ or retain persons necessary to perform the duties of the residual
   market facility;

   2. Acquire, hold, and dispose of real and personal property, or any interest
   in real and personal property;

   3. Borrow funds necessary to effect the purposes of this chapter in accord
   with the plan of operation;

   4. Negotiate and become a party to those contracts necessary to carry out the
   purposes of this chapter;

   5. Indemnify any director or member of its governing body, officer, employee,
   or agent in the manner permitted by and subject to the limitations contained
   in Article 9 (&#xA7; 13.1-875 et seq.) of Chapter 10 of Title 13.1; and
   provide any other or further indemnity to any such person that may be
   authorized by the plan of operation except an indemnity against his gross
   negligence or willful misconduct, and purchase and maintain insurance in the
   manner permitted by &#xA7; 13.1-882; and

   6. Perform any other acts necessary or proper to carry out the purposes of
   this chapter.

D. The residual market facility shall not be deemed to be an insurer within the
provisions of &#xA7; 38.2-100.

HISTORY: 1968, c. 559, § 38.1-748; 1973, c. 451, § 38.1-748.1; 1980, c. 156;
1982, c. 664; 1986, c. 562.