Vermont § 4982 - Creation of Vermont joint underwriting associations

§ 4982. Creation of Vermont joint underwriting associations

• (a) The Commissioner is hereby authorized, under the terms of this chapter, to establish
  one or more Vermont joint underwriting associations. The purpose of any such association
  shall be to provide insurance on a self-supporting basis without subsidy from its
  members. No such association formed pursuant to this chapter shall be formed for
  the purpose of providing coverage for pollution exposures. (b) Each insurer authorized to write, and engaged in writing within this State, property
  and casualty insurance shall be a member of an association established under this
  chapter by the Commissioner and shall remain a member as a condition of its authority
  to write such insurance within this State, except that the Commissioner may exclude
  classes of insurers for administrative convenience or because it is not practicable
  to require them to participate. (c) An association shall be a temporary, nonexclusive, nonprofit unincorporated association
  constituting a legal entity separate and distinct from its members. All funds and
  reserves of an association shall be separately held and invested. (d) An association shall not commence or resume after suspension any of its underwriting
  operations until the Commissioner, after due hearing and investigation, determines,
  and the emergency board approves such determination, that a voluntary market of insurance
  does not exist and that a voluntary market assistance plan has failed to restore availability
  of the needed insurance coverages. Upon such determination, an association shall
  be authorized to engage in the underwriting of any specific line of insurance determined
  to be unavailable in the voluntary market. If, after an association commences its
  operation, the Commissioner determines that insurance can be made available in the
  voluntary market, he or she shall suspend the operation of the association. The Commissioner
  may re-establish the association’s operations if he or she finds after due hearing
  and investigation that the insurance industry has failed to provide a voluntary market
  for the specific line of insurance underwritten through the association. (e) An association shall, subject to the terms and conditions of this chapter, have power
  on behalf of its members to: (1) Issue, or to cause to be issued, policies of insurance to qualified applicants, including
  incidental coverages and subject to limits as specified in the plan of operation.
  Coverages under such policies may be made available as primary or excess protection. (2) Underwrite and otherwise service such policies of insurance and adjust and pay losses
  with respect thereto, or appoint service companies or associations to perform those
  functions. (3) Assume or cede 100 percent reinsurance or a lesser percentage on any policy underwritten
  by the association. (Added 1985, No. 265 (Adj. Sess.), § 4, eff. June 4, 1986.)