CHAPTER 605

An Act to amend and reenact § 38.1-108 and § 88.1-118, as amended, of
the Code of Virginia, relating to deposits required of insurance com-
panies generally and surety bonds in lieu thereof. rH 765)

Approved March 31, 1964

Be it enacted by the General Assembly of Virginia: a
1. That § 38.1-108 and § 38.1-113, as amended, of the Code of Virginia,
be amended and reenacted, as follows:

§ 38.1-108. Except as otherwise provided in this title, before the
Commission shall issue a license to transact business in this State to any
domestic, foreign or alien insurance company, such company shall deposit
with the State Treasurer securities that are legal investments under the
laws of this Commonwealth for public sinking funds that are not in default
as to principal or interest and are of the current market value of not less
than * fifty thousand dollars nor more than * two hundred thousand dol-
lars. In lieu of such deposit of securities, an insurance company may enter
into a bond with surety, approved by the Commission, in the penalty of
not less than * fifty thousand dollars nor more than * two hundred thou-
sand dollars with such conditions as the Commission may require; pro-
vided that such surety shall be an insurance company duly licensed in this
State to transact the business of suretyship and shall not either directly
or indirectly be under the same ownership or management as the principal
on such bond. The Commission shall prescribe the amount of the securi-
ties or the penalty of the surety bond to be deposited initially by each
company and, at its discretion and within the limits specified herein, may
subsequently require an increase or authorize a decrease in the amount of
such deposit or in the penalty of the bond.

Neither the deposit referred to herein nor the alternate deposit per-
mitted by § 38.1-113 shall be required of (1) any mutual assessment fire
insurance company, (2) any fraternal benefit society, or (3) any insurance
company transacting exclusively an ocean marine business in this State.

§ 38.1-118. If any insurance company shall deposit with the State
Treasurer, or with the insurance commissioner, treasurer or other officer
or official body of any state or states of the United States for the protec-
tion of all policyholders of such company, acceptable securities, as herein-
after defined, not in default as to principal or interest and of a current
market value of not less than two hundred thousand dollars, and shall
deliver to the Commission a certificate to such effect, duly authenticated
by the appropriate state official holding the deposit, such company * at
the discretion of the Commission may be relieved of making the deposit
with the Treasurer of Virginia required by § 38.1-108.

For the purpose of this section, acceptable securities are defined as
bonds of the United States, or of any state of the United States, or of any
city, county or town thereof, or bonds or notes secured by mortgages or
deeds of trust on otherwise unencumbered real estate of a market value
in each case of not less than double the amount loaned, or such other
securities as may be approved by the Commission.