The Vermont Statutes Online

Title 8 : Banking and Insurance

Chapter 112 : Life and Health Insurance Guaranty Association

• § 4180. Plan of operation

  (a)(1) The Association shall submit to the Commissioner a plan of operation and any amendments to the plan necessary or suitable to ensure the fair, reasonable, and equitable administration of the Association. The plan of operation and any amendments to the plan shall become effective upon approval in writing by the Commissioner.

  (2) If the Association fails to submit a suitable plan of operation within 120 days following the effective date of this chapter or if at any time thereafter the Association fails to submit suitable amendments to the plan, the Commissioner shall, after notice and hearing, adopt such reasonable rules as are necessary or advisable to effectuate the provisions of this chapter. Such rules shall continue in force until modified by the Commissioner or superseded by a plan submitted by the Association and approved by the Commissioner.

  (b) All member insurers shall comply with the plan of operation.

  (c) The plan of operation shall, in addition to requirements enumerated elsewhere in this chapter:

  (1) establish procedures for handling the assets of the Association;

  (2) establish the amount and method of reimbursing members of the Board of Directors under section 4177 of this chapter;

  (3) establish regular places and times including virtual conference calls for meetings of the Board of Directors;

  (4) establish procedures for records to be kept of all financial transactions of the Association, its agents, and the Board of Directors;

  (5) establish the procedures whereby selections for the Board of Directors will be made and submitted to the Commissioner;

  (6) establish any additional procedures for assessments under section 4179 of this chapter;

  (7) contain additional provisions necessary or proper for the execution of the powers and duties of the Association;

  (8) establish procedures whereby a Director may be removed for cause, including in the case where a member insurer Director becomes an impaired or insolvent insurer; and

  (9) require the Board of Directors to establish a policy and procedures for addressing conflicts of interests.

  (d) The plan of operation may provide that any or all powers and duties of the Association, except those under subdivision 4178(l)(3) and section 4179 of this chapter, are delegated to a corporation, association, or other organization that performs or will perform functions similar to those of this Association, or its equivalent in two or more states. Such a corporation, association, or organization shall be reimbursed for any payments made on behalf of the Association and shall be paid for its performance of any function of the Association. A delegation under this subsection shall take effect only with the approval of both the Board of Directors and the Commissioner, and may be made only to a corporation, association, or organization that extends protection not substantially less favorable and effective than that provided by this chapter. (Added 2023, No. 32, § 9, eff. July 1, 2023.)