Vermont Statutes
Chapter 112 - Life and Health Insurance Guaranty Association
§ 4162. Prevention of impairment or insolvency

§ 4162. Prevention of impairment or insolvency
To aid in the detection and prevention of insurer impairment or insolvency:
(1) The Board of Directors shall, upon majority vote, notify the Commissioner of any information indicating any member insurer may be unable or potentially unable to fulfill its contractual obligations.
(2) The Board of Directors may, upon majority vote, request that the Commissioner order an examination of any member insurer which the Board in good faith believes may be unable or potentially unable to fulfill its contractual obligations. The Commissioner may conduct such examination. The examination may be conducted as a National Association of Insurance Commissioners examination or may be conducted by such persons as the Commissioner designates. The cost of such examination shall be paid by the Association and the examination report shall be treated as are other examination reports. In no event shall such examination report be released to the Board of Directors of the Association prior to its release to the public, but this shall not excuse the Commissioner from his or her obligation to comply with subdivision (3) of this section. The Commissioner shall notify the Board of Directors when the examination is completed. The request for an examination shall be kept on file by the Commissioner but it shall not be open to public inspection prior to the release of the examination report to the public and shall be released at that time only if the examination discloses that the examined insurer is unable or potentially unable to meet its contractual obligations.
(3) The Commissioner shall report to the Board of Directors when he or she has reasonable cause to believe that any member insurer examined at the request of the Board of Directors may be unable or potentially unable to fulfill its contractual obligations.
(4) The Board of Directors may, upon majority vote, make reports and recommendations to the Commissioner upon any matter germane to the solvency, liquidation, rehabilitation, or conservation of any member insurer. Such reports and recommendations shall not be considered public documents.
(5) The Board of Directors may, upon majority vote, make recommendations to the Commissioner for the detection and prevention of insurer impairment or insolvency.
(6) The Board of Directors shall, at the conclusion of any insurer impairment or insolvency in which the Association carried out its duties under this subchapter or exercised any of its powers under this subchapter, prepare a report on the history and causes of such impairment or insolvency, based on the information available to the Association, and submit such report to the Commissioner. (Added 1971, No. 170 (Adj. Sess.), § 2, April 27, 1972; amended 2009, No. 137 (Adj. Sess.), § 7e, eff. May 29, 2010.)

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