Key Takeaways
- Virginia commercial property insurance operates under the file-and-use rate system
- Commercial policies require specific disclosure of terrorism coverage options under TRIA
- Virginia allows surplus lines insurance for risks not available in the admitted market
- Commercial properties in high-risk areas may need VPIA commercial coverage
- Business interruption and extra expense coverage have specific Virginia requirements
Last updated: January 2026
Virginia Commercial Property Insurance
Virginia regulates commercial property insurance with specific requirements for rates, disclosures, and coverage availability.
Rate Regulation
Under Virginia's file-and-use system, commercial property insurance rates:
- Filed with Bureau of Insurance before use
- Become effective upon filing
- Commissioner can disapprove within 30 days
- Must not be excessive, inadequate, or unfairly discriminatory
- Based on actuarially justified loss experience
Commercial Rate Flexibility
Some commercial lines have different regulatory treatment:
| Line | Rate Regulation |
|---|---|
| Workers' Compensation | Administered by NCCI |
| Commercial Auto | File-and-use |
| Large Commercial Property | More flexibility |
| Surplus Lines | Not rate-regulated |
Terrorism Insurance
TRIA (Terrorism Risk Insurance Act)
- Federal program providing terrorism insurance backstop
- Virginia insurers must offer terrorism coverage
- Policyholder can accept or reject terrorism coverage
- Disclosure of coverage terms required
Required Disclosures
- Coverage limits for terrorism
- Premium for terrorism coverage
- Right to accept or reject
- Exclusions and limitations
Commercial VPIA
The Virginia Property Insurance Association also serves commercial properties:
Commercial Coverage
- Basic fire and extended coverage
- Building and business personal property
- Higher limits available than residential
- Requires evidence of voluntary market declination
Surplus Lines Insurance
Virginia allows surplus lines insurance for risks not available in the admitted market:
Surplus Lines Requirements
| Requirement | Details |
|---|---|
| Diligent Search | Must contact admitted insurers first |
| Eligible Surplus Lines Insurer | Must be on approved list |
| Surplus Lines Broker | Must use licensed SL broker |
| Surplus Lines Tax | 2.25% of premium |
| Disclosure | Must disclose SL status to insured |
Export Requirements
Virginia requires documentation that coverage is not available in the admitted market before placing with surplus lines:
- Document declinations from admitted insurers
- Certain commercial risks may be directly exported
- Surplus lines broker must maintain records
Business Interruption Insurance
Virginia has specific requirements for business interruption coverage:
Key Provisions
- Must clearly define covered perils
- Waiting/deductible period disclosed
- Period of restoration defined
- Extended period of indemnity options
- Civil authority coverage requirements
Coverage Elements
| Element | Description |
|---|---|
| Business Income | Lost profits during restoration |
| Extra Expense | Additional costs to continue operations |
| Civil Authority | Loss when government prohibits access |
| Contingent BI | Loss from supplier/customer disruption |
Extra Expense Coverage
- Covers costs to continue operations during restoration
- Separate limit from business interruption
- Virginia requires clear disclosure of coverage terms
- Time limits apply to extra expense coverage
Test Your Knowledge
What is the Virginia surplus lines tax rate?
A
B
C
D
Test Your Knowledge
Under TRIA, must Virginia insurers offer terrorism coverage to commercial policyholders?
A
B
C
D