The Vermont Statutes Online
The Statutes below include the actions of the 2025 session of the General Assembly.
NOTE: The Vermont Statutes Online is an unofficial copy of the Vermont Statutes Annotated that is provided as a convenience.
(Cite as: 8 V.S.A. § 4986)
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§ 4986. Deficits
(a) In the event an association suffers an underwriting deficit for any year, the board
of directors shall so certify to the Commissioner. Such certification shall be subject
to the review and approval of the Commissioner. As provided in the plan of operation,
but in a term not to exceed one year, each policyholder shall pay to the association
a premium contingency assessment that bears the same ratio to the amount of such deficit
as his or her premium for such year for insurance written or reinsured by the association
bore to the total premiums paid to the association for such year. The association
may cancel any policy of any policyholder who fails to pay the premium contingency
assessment and need not pay any future claims against that policyholder. Any deficit
premium contingency assessment uncollectible against any policyholder shall not be
assessed against any other policyholder or policyholders.
(b) In no event shall a deficit incurred by an association be charged directly or indirectly
to any insured other than a policyholder insured through an association.
(c) An association shall amend the amount of its certification of deficit to the Commissioner
as the values of its incurred losses become finalized, and the members of the association
shall upon approval by the Commissioner amend their recoupment procedure accordingly.
The board of directors of an association may require all members to contribute on
a temporary basis to the financial requirements of the association prior to recoupment
of any deficit in such proportion as shall be specified in the plan. (Added 1985, No. 265 (Adj. Sess.), § 4, eff. June 4, 1986.)