Virginia Law

A. An application submitted by a group self-insurance association shall be accompanied by the following items. These items shall be subject to the approval of the commission:

1. A copy of the members' indemnity agreement and power of attorney required by 14VAC5-370-120 binding the association and each member of the association, jointly and severally, to comply with the provisions of the Act and copies of any other governing instruments of the proposed group self-insurance association;

2. An executed copy of the application of each employer for membership in the association on the effective date of the license of the association;

3. Financial statements of all applicants for membership showing that the membership of the proposed association has a combined net worth of at least one million dollars. Political subdivisions of this Commonwealth may combine to form associations without complying with this requirement;

4. Proof of payment by each member of at least 25% of its estimated first year's contribution into a designated depository;

5. A confirmation of excess insurance, if excess insurance is required, by a licensed insurer in an amount acceptable to the commission which complies with the requirements set forth in 14VAC5-370-90. However, the commission at its discretion may allow this insurance to be placed with an approved surplus lines insurer;

6. Designation of the board and of the administrator of the association, together with properly executed biographical affidavits for each member of the board and for the administrator or the principal officers of a corporation serving as an administrator. Affidavits are to be submitted on a form prescribed by the commission;

7. The address in this Commonwealth where the books and records of the pool will be maintained at all times;

8. Information showing that the association has, within its own organization or by contract with an approved service agent, adequate facilities and competent personnel to service its program with respect to underwriting matters, claims adjusting, and industrial safety engineering. Copies of all executed servicing agreements shall be filed with the commission;

9. A confirmation of a fidelity bond in a form and amount acceptable to the commission;

10. Deposit of securities or a surety bond with the State Treasurer in an amount acceptable to the commission in accordance with the requirements of 14VAC5-370-60;

11. A projection of administrative expenses for the first year of operation in an amount and as a percentage of the estimated annual contributions;

12. A statement regarding the type of business and guidelines to be used to determine common interest; and

13. A copy of the association's contracts with the service agent and the administrator which sets forth the terms and obligations of the agreement.

B. An application submitted by a group self-insurance association shall be accompanied by all of the following:

1. A composite listing of the estimated annual gross contribution to be developed by each member of the association individually and in the aggregate for the association, which, in the aggregate, shall be not less than $500,000 for each of the association's first two years and thereafter for subsequent years shall be not less than $1 million, provided that this latter requirement shall not apply to groups licensed prior to May 1, 1988; and

2. The application shall be accompanied by any other information the commission requires.

C. Any subsequent revisions to items submitted under the provisions of 14VAC5-370-30 and this section will be filed with and subject to approval by the commission. Any subsequent revisions of the items in subsection B of this section will be filed with the commission.