CHAP. 243.-An ACT to amend and re-enact section 11 of chapter 1; sec-
tions 7, 8 9, 17, 19, 34 and 39 of chapter 2, and to add new sections
a2, 53, 54 and 50 to chapter 2 of an act entitled “an act concerning
the bureau of insurance, and insurance, guaranty, trust, indemnity,
fidelitv, security, and fraternal benefit companies, associations, so-
cieties, and orders, and imposing penalties for its violation,” approv-
ed March 9, 1906, as amended by an act approved March 12, 1908.

Approved March 13, 1912.

1. Be it enacted by the general assembly of Virginia, That
section eleven of chapter one; sections seven, eight, nine, seven-
teen, nineteen, thirty-four and thirty-nine of chapter two of an
act entitled “an act concerning the bureau of insurance, and in-
surance, guaranty, trust, indemnity, fidelity, security and
fraternal benefit companies, associations, societies and orders,
and imposing penalties for its violation,” approved March ninth,
nineteen hundred and six, as amended by an act approved March
twelfth, nineteen hundred and eight, be amended and re-enacted
and new sections to be known as fifty-two, fifty-three, fifty-four
and fifty-five-of chapter two, be added thereto, such sections, as
amended, and such new sections to read as follows:

CHAPTER 1.

§11. Whenever the commissioner of insurance shall deem
it necessary for the protection of the policyholders of this State,
or of persons who may have become policyholders, in any foreign,
alien, or domestic insurance company, doing business in this State
or for the protection of the State, or of any incorporated city
or town therein, or of any corporation chartered or doing busi-
ness therein, or of any person or persons, or partnership, in this
State, in any wise secured or indemnified, or to be secured or
indemnified, by any guaranty, trust, indemnity, fidelity, security,
or other like company, either foreign, alien, or domestic, doing
business in this State, he may make or direct to be made an
examination of the affairs and financial condition of any such
company by his assistants, or such other person as he may think
proper, and for the purpose of such examination, the commis-
sioner of insurance, or his assistants, or the person making such
examination, shall have free access to the books and papers of any
such company that relates to its business, and to the books
and papers kept by any of its agents, and may summon and
qualify as witnesses, under oath, and examine the directors, of-
ficers, agents, or trustees of any such company, or any other
person, in relation to its affairs, transactions and condition. All
expenses of an examination made under the provisions of this
section shall be paid by the corporation examined, unless re-
mitted by the commissioner of insurance, and in the same
manner the commissioner of insurance may examine into the
affairs of any corporation organized under any law of this State
or having an office in this State, which corporation is engaged
in, or is claiming or advertising that it is engaged in organizing
or receiving subscriptions for or disposing of stock of, or in any
manner aiding or taking part in the formation or business of,
an insurance corporation or corporations, or which is holding
the capital stock of one or more insurance corporations for the
purpose of controlling the management thereof as voting trustees
or otherwise.

CHAPTER IT.

$7. Every foreign or alien insurance, guaranty, trust,
indemnity, fidelity, security, or other like company, shall, by
a written power of attorney, appoint the commissioner of insur-
ance, or his suecessor in office, its agent, upon whom shall be
served all lawful process or notice against such company, and who
shall be authorized to enter an appearance in its behalf. A copy
of such power of attorney, duly certified and authenticated, shall
be filed with the bureau of insurance, and copies thereof duly
certified by the commissioner of insurance, shall be received as
evidence in all courts of this State.

S8. Whenever lawful process against any such company
shall be served upon the commissioner of insurance, he shall
forthwith mail a copy of such process to the company, or, in case
of companies of foreign countries, to the resident manager, if
any, in this country. For each copy of process the commissioner
shall collect two dollars and fifty cents, which shall be paid by
the plaintiff at the time of such service, the same to be recovered
by him as part of the taxable costs if he prevails in the suit.
A judgment, decree, or order of a court entered or made against
any such company, after service of process or notice as aforesaid,
shall be as valid and binding on said company as if it had been
incorporated under the laws of this State and served with pro-

cess or notice therein, ,
$9. Before license and authority is granted to any for-
eign or alien insurance, guaranty, trust, indemnity, fidelity, se-
curity, or other like company, to transact business in this State,
it shall file with the commissioner of insurance a resolution
adopted by its board of directors, consenting that service of pro-
cess or notice upon the commissioner of insurance in any action
brought or pending in this State, shall be valid service of such
process or notice upon said company.

§17. Upon the bonds deposited as aforesaid, with the
treasurer, by any such insurance company, the holder of all
policies of said company made with residents of this State, or
upon property located in this State, shall have a lien for the
amounts due them, respectively, under or in consequence of
such policies for losses, equitable values, return premiums, or
otherwise, and shall be entitled to be paid ratably out of the
proceeds of said bonds, if such proceeds be not sufficient to pay
all of said policyholders; and whenever any such company, de-
positing bonds as aforesaid, shall have become insolvent or bank-
rupt, or shall have made an assignment for the benefit of its
creditors, any holder of such policy shall have the right to file
a bill in the circuit court of the city of Richmond to enforce
the said lien for the benefit of all the holders of such policies.
The treasurer shall be a party to the suit, and the fund shall
be distributed by the court.

§19. If such company cease to carry on business in this
State, and its liabilities, whether fixed or contingent, upon its
policies, to persons residing in this State, shall have been satisfied,
or shall have terminated, upon satisfactory evidence of the fact
to the State corporation commission, it may direct the treasurer
to deliver to such company the bonds in his possession, belonging
to it or such of them as remain after paying the liabilities afore-
said; or, if such company shall reduce the amount of its liabilities,
both fixed and contingent, upon its policies to persons residing in
this State, below the value of the bonds in the possession of the
treasurer, he may, on the order of the State corporation com-
mission, deliver to such company a part of such bonds, taking
care, however, that the bonds in his possession shal! always be
equal in value to the liabilities of said company upon its poi‘cies
to persons residing in this State; or, if such companv cease to
carry on business in this State, and its fixed liabilities for losses
and for taxes, fees and other charges shall have been satisfied,
and the contingent liabilities under its policies shall have been as-
sumed by another company doing business in this State, the State
corporation commission, upon being satisfied of these facts, shall,
upon receiving a duly attested copy of the contract between the
two companies by which the risks of the retiring company are
assumed by the other company, direct the treasurer to deliver to
such company proposing to withdraw, the bonds in his possession
belonging to it.

§34. That fire, accident, health, emplovers’ liability, steam
boiler, plate glass, surety, burglary or other insurance companies
not incorporated by the laws of the State of Virginia, but legally
authorized to do business in this State, shall not make contracts
of insurance on persons or property herein, save through regu-
larly constituted agents of such companies residing in the State of
Virginia; provided, however, that this act shall not apply to rail-
road companies and other common carriers engaged in interstate
commerce; and the writing, placing, or causing to be written or
placed, any policy of fire, accident, health, employers’ liability,
steam boiler, plate glass, surety, burglary, or other insurance in
contravention of this section, is hereby declared to be a violation
of the laws of this State, providing for the payment of taxes by
foreign and alien insurance companies permitted to do business
in Virginia. No life insurance corporation doing business in
this State shall make any discrimination in favor of individuals
of the same class or of the same expectation of life, either in the
amount of premium charged or in any return of premium,
dividends or other advantages. No policy of life insurance shall
be issued or delivered in tnis State if it shall purport to be issued
or to take effect, at an age lower than the actual age of the appli-
cant at the time of the original written application. No agent
of any insurance corporation shall make any contract for in-
surance or agreement as to such contract other than that which
is plainly expressed in the policy issued. No insurance corpora-
tion or agent thereof shall pay, or allow or offer to pay, or allow
as an inducement to any person to insure any rebate of premium,
or any special favor or advantage whatever in the dividends to
accrue thereon, or any inducement whatever not specified in the
policy. If it shall appear to the satisfaction of the commissioner
of insurance, after hearing by him, upon due notice, that any
corporation is issuing policies or making contracts that are
directly or indirectly in violation of this section, he shall require
such corporation, and its officers and agents, to refrain within
twenty days from making any such policy or contract; provided,
that nothing in this chapter shall be so construed as to forbid a
company transacting industrial insurance on a weekly payment
plan with weekly collections of premiums at the homes of the
insured, from returning to policyholders who have made premium
payments directly to the company at its home office or district
offices, the savings which the company effects through such direct
payment, or to forbid a life insurance company from allowing
its bona fide employees to receive a commission on the premiums
paid by them on policies on their own lives.

$39. No condition in, or endorsed on, any policy of insur-
ance, nor any restrictive provision thereof, shall be valid un-
less such condition or restrictive provision is printed in type
as large as brevier, or eight-point type, or is written in pen and
ink or typewriter, in or on the policy, and no provision in any
policy of insurance limiting the time within which a suit or
action may be brought to less than one year after loss shall be
valid; provided, however, that nothing herein contained shall
relate to or effect photographic copies of applications or parts
thereof attached to or made parts of policies of insurance.

§52. If any domestic insurance corporation, association or
society chartered prior to December thirty-first, nineteen hun-
dred and eight, has failed to carry out the purposes for which
it was chartered, by applying for and receiving a license from
the commissioner of insurance to do business in this State since
the date above mentioned, and shall fail, within ninety days
after the passage of this act, to apply for and receive the license
aforesaid, its charter shall be revoked and annulled; provided,
that this section shall not apply to any corporation, association
or society which is not required by the “act concerning the
bureau of insurance” to be licensed by the commissioner of in-
surance in order to do business in this State.

$53. No stock salesman, broker or other person represent-
ing any insurance company, wherever incorporated, in process
of organization and not licensed to transact business in this
State, shall be permitted to solicit subscriptions to or sell the
stock of such company unless such company has first furnished
the bureau of insurance with full particulars as to the methods
and proposed cost of promotion. Any person soliciting sub-
scriptions to or selling stock of any insurance company con-
trary to the provisions of this act, shall be subject to a fine of not
exceeding one hundred dollars for each offense.

§54. No company hereafter chartered as a fire, life or acci-
dent insurance company, or a surety company, shall be allowed
to engage in the banking business.

§55. No insurance corporation or fraternal beneficiary as-
sociation or society, or agent thereof, shall publish in this State,
in any manner, any false or misleading statement, or any state-
ment at variance with its last sworn report filed with the bureau
of insurance. Any violation of this section shall be punished by
a fine notlexceeding one hundred dollars.