January 24, 2011
NONPROFIT VOLUNTEER AMBULANCE COMPANIES
By: Janet L. Kaminski Leduc, Senior Legislative Attorney
You asked if Vermont requires a nonprofit volunteer ambulance company to be licensed as an insurance company and meet insurance reserve requirements (e.g., capital and surplus). You also asked if Connecticut can exempt such an ambulance company from state insurance laws.
An ambulance company in Vermont does not have to be licensed as an insurance company or meet insurance reserve requirements because the law exempts ambulance companies licensed by the board of health from state insurance laws. Connecticut lawmakers could pass legislation to do the same thing.
Vermont law defines various types of insurance, including health insurance, which is insurance against bodily injury, disablement, or accidental death and any related expense (Vt. Stat. Ann. tit. 8, § 3301(a)(2)). To act as an insurer, a company must be licensed by the Insurance Division of the Vermont Department of Banking, Insurance, Securities and Healthcare Administration. An insurer must comply with insurance laws, including capital and surplus requirements (Vt. Stat. Ann. tit. 8, § 3304).
Vermont law explicitly excludes from “the regulation of the business of insurance . . . activities engaged in by ambulance services and first responder services for which they are licensed by the board of health” (Vt. Stat. tit. 8, § 3301(e)). It appears that the exclusion applies to nonprofit volunteer ambulance companies, as long as the companies are properly licensed by the board of health.
Connecticut law defines “insurance” in part as “any agreement to pay a sum of money, provide services or any other thing of value on the happening of a particular event” (CGS § 38a-1(10)). Insurers are subject to capital and surplus requirements, various other laws, and regulation by the Connecticut Insurance Department.
Connecticut does not exclude ambulance companies from the definition of insurance, but it could enact legislation to do this.
For a more comprehensive discussion of this topic, see OLR research report 2009-R-0323.