                                 CODE OF VIRGINIA

ACCUMULATION OF RESERVE FOR AN EMERGENCY FUND (§ 38.2-4010)

A. In addition to provision for liability incurred on account of claims reported
but not settled, claims incurred but not reported, and premiums, dues or
assessments collected in advance, every company shall accumulate and maintain a
reserve for an emergency fund, which in the preparation of financial statements
shall be considered a liability of the corporation, of at least $10,000.

B. Each burial society shall, in each calendar year, add to that reserve for an
emergency fund at least five percent of its net receipts from premiums, dues or
assessments from policies of life insurance until the total accumulated reserve
fund equals twenty percent of the total benefits provided in the outstanding
certificates of life insurance. However, when the corporation has issued
policies of life insurance on a legal reserve basis, the net receipts from those
policies shall not be considered in the calculation of the reserve for an
emergency fund, but the burial society shall be required to maintain only the
reserve provided for in the certificates.

HISTORY: Code 1950, §§ 38-149, 38-461; 1952, c. 317, §§ 38.1-534, 38.1-559;
1986, c. 562.