CHAPTER 633

An Act to amend and reenact §§ $8.1-780, 38.1-781, and 88.1-782 of the
Code of Virginia, relating to unearned premium reserves on certain
title insurance contracts; the amount of such reserves; the reduction
thereof; and such reserves required of alien and foreign title insur-
ance companies.

[H 1163]

Approved April 4, 1968

Be it enacted by the General Assembly of Virginia:

1. That §§ 38.1-730, 38.1-731 and 38.1-732, of the Code of Virginia, be
amended and reenacted as follows: ;

§ 38.1-730. * Every domestic title insurance company shall, in addt-
tion to other reserves, establish and maintain a reserve to be known as
the “unearned premium reserve” for title insurance, which shall at all
times and for all purposes be considered and constitute unearned portions
of the original risk premiums and shall be charged as a reserve liability
of such title insurance company in determining its financial condition.

§ 38.1-731. * (1) The unearned premium reserve of every domestic
title insurance company shall consist of the aggregate of:

(a) The amount of the unearned premium reserve held as of the
effective date of this act pursuant to any laws of this state in force prior
to the effective date of this act, and

(b) The amount of all additions required to be made to such reserve
by this section, less the reduction of such aggregate amount required by
this section.

(2) On each contract of title insurance issued by a domestic title
insurance company on and after the effective date of this act, there shall
be reserved initially as an unearned premium reserve a sum equal to ten
per centum of the original risk premium charged therefor.

(8) The aggregate of the amounts set aside in unearned premium
reserve in any calendar year pursuant to subsection (2) of this section
shall be reduced annually, at the end of each calendar year following the
year in which the policy is issued, at the annual rate of one-twentieth of
the aggregate of such amounts.

(4) The amount of the unearned premium reserve on any policy here-
tofore issued which is held on the effective date of this act shall be reduced
annually hereafter during the unexpired portion of the original period for
maintenance of such reserve at the annual rate of reduction provided by
the laws of this State in effect when the reserve was established.

§ 38.1-732. * Every foreign or alien title insurance company licensed
to transact title insurance in this State * shall reserve and maintain the
same reserves as are required of domestic companies under the provisions
of § 38.1-731, unless by the laws of the state or country of domicile of
such company there is required to be set aside and maintained * unearned
premium reserves in at least as great an amount as is required of domestic
companies by that section.