VA HB1504 | 2011 | Regular Session
Status
Completed Legislative Action
Spectrum: Partisan Bill (Republican 1-0)
Status: Passed on March 16 2011 - 100% progression
Action: 2011-03-16 - Governor: Acts of Assembly Chapter text (CHAP0198)
Text: Latest bill text (Chaptered) [HTML]
Spectrum: Partisan Bill (Republican 1-0)
Status: Passed on March 16 2011 - 100% progression
Action: 2011-03-16 - Governor: Acts of Assembly Chapter text (CHAP0198)
Text: Latest bill text (Chaptered) [HTML]
Summary
Insurance companies; investments in derivative transactions; exercising qualified financial contracts upon insolvency or delinquency. Establishes conditions under which domestic insurers may engage in transactions involving derivative instruments, including options, warrants, caps, floors, collars, swaps, forwards, and futures. Derivative instruments may be used to engage in hedging transactions and replication transactions provided insurers establish written guidelines for their use and procedures to determine that their transactions comply with such guidelines. The guidelines shall be submitted to the State Corporation Commission (SCC) for prior approval. The SCC may adopt rules and regulations for derivative transactions including financial solvency standards, valuation standards, and reporting requirements. An insurer engaged in hedging transactions shall demonstrate to the SCC the ongoing effectiveness of the derivative transaction or combination of the transactions through cash flow testing or other analyses. Limits are established on the percentage of assets that may be used in hedging transactions. An insurer's replication transactions are required to comply with limitations on investments by the insurer, and the aggregate statement value of all assets being replicated is limited to 10 percent of the insurer's admitted assets. The measure also provides rules regarding a person's ability to exercise a contractual right to terminate obligations under a netting agreement or qualified financial contract with an insurer because of the insurer's insolvency, financial condition, or default or the commencement of a delinquency proceeding against the insurer. A receiver may not avoid a transfer arising under or in connection with a netting agreement or qualified financial contract that is made before the commencement of a delinquency proceeding unless the transfer was made with actual intent to hinder, delay, or defraud the insurer, a receiver, or creditors. If a receiver disaffirms or repudiates a netting agreement or qualified financial contract within a reasonable period after the commencement of a delinquency proceeding, the claim of a counterparty against the estate arising from the disaffirmance or repudiation shall be allowed or disallowed as if the claim arose before the filing of the petition for liquidation or rehabilitation. The measure also provides that the prohibition on investments by domestic insurers in securities that will subject the insurer to any assessment does not include ordinary contractual payments or the transfer of collateral or margin made under derivative instruments. The measure includes an enactment clause that allows insurers currently investing in derivative instruments to continue doing so after the effective date of this act provided they submit guidelines to the SCC for review by April 1, 2011.
Title
Insurance companies; investments in derivative transactions, etc.
Sponsors
Del. Lee Ware [R] |
Roll Calls
2011-02-17 - Senate - Senate: Passed Senate (39-Y 0-N) (Y: 39 N: 0 NV: 1 Abs: 0) [PASS]
2011-02-16 - Senate - Senate: Constitutional reading dispensed (40-Y 0-N) (Y: 40 N: 0 NV: 0 Abs: 0) [PASS]
2011-02-14 - Senate - Senate: Reported from Commerce and Labor (15-Y 0-N) (Y: 15 N: 0 NV: 0 Abs: 0) [PASS]
2011-01-24 - House - House: VOTE: BLOCK VOTE PASSAGE (97-Y 0-N) (Y: 99 N: 0 NV: 2 Abs: 0) [PASS]
2011-01-18 - House - House: Reported from Commerce and Labor with amendment (21-Y 0-N) (Y: 21 N: 0 NV: 1 Abs: 0) [PASS]
2011-02-16 - Senate - Senate: Constitutional reading dispensed (40-Y 0-N) (Y: 40 N: 0 NV: 0 Abs: 0) [PASS]
2011-02-14 - Senate - Senate: Reported from Commerce and Labor (15-Y 0-N) (Y: 15 N: 0 NV: 0 Abs: 0) [PASS]
2011-01-24 - House - House: VOTE: BLOCK VOTE PASSAGE (97-Y 0-N) (Y: 99 N: 0 NV: 2 Abs: 0) [PASS]
2011-01-18 - House - House: Reported from Commerce and Labor with amendment (21-Y 0-N) (Y: 21 N: 0 NV: 1 Abs: 0) [PASS]
History
Date | Chamber | Action |
---|---|---|
2011-03-16 | Governor: Acts of Assembly Chapter text (CHAP0198) | |
2011-03-16 | Governor: Approved by Governor-Chapter 198 (effective 7/1/11) | |
2011-02-23 | Senate: Signed by President | |
2011-02-23 | House: Signed by Speaker | |
2011-02-23 | House: Bill text as passed House and Senate (HB1504ER) | |
2011-02-23 | House: Enrolled | |
2011-02-17 | Senate: Passed Senate (39-Y 0-N) | |
2011-02-17 | Senate: Read third time | |
2011-02-16 | Senate: Constitutional reading dispensed (40-Y 0-N) | |
2011-02-14 | Senate: Reported from Commerce and Labor (15-Y 0-N) | |
2011-01-25 | Senate: Referred to Committee on Commerce and Labor | |
2011-01-25 | Senate: Constitutional reading dispensed | |
2011-01-24 | House: VOTE: BLOCK VOTE PASSAGE (97-Y 0-N) | |
2011-01-24 | House: Read third time and passed House BLOCK VOTE (97-Y 0-N) | |
2011-01-21 | House: Printed as engrossed 11101964D-E | |
2011-01-21 | House: Engrossed by House as amended HB1504E | |
2011-01-21 | House: Committee amendment agreed to | |
2011-01-21 | House: Read second time | |
2011-01-20 | House: Read first time | |
2011-01-18 | House: Reported from Commerce and Labor with amendment (21-Y 0-N) | |
2010-12-17 | House: Referred to Committee on Commerce and Labor | |
2010-12-17 | House: Prefiled and ordered printed; offered 01/12/11 11101964D |
Subjects
Code Citations
Chapter | Article | Section | Citation Type | Statute Text |
---|---|---|---|---|
38 | 2 | 1401 | (n/a) | See Bill Text |
38 | 2 | 1407 | (n/a) | See Bill Text |
38 | 2 | 1428 | (n/a) | See Bill Text |
38 | 2 | 1501 | (n/a) | See Bill Text |
38 | 2 | 1522 | (n/a) | See Bill Text |