Published: 2015
Key Benefits:
[Rev. 8/27/2018 12:29:24 PM]
[NAC-686B Revised Date: 8-18]
CHAPTER 686B - RATES AND ESSENTIAL INSURANCE
GENERAL PROVISIONS
686B.005 Definitions.
686B.100 Electronic filing of rates, rules and forms and payment of fees.
REPORTING FINANCIAL AND STATISTICAL DATA
686B.300 Definitions.
686B.308 “Annual statement” defined.
686B.314 “Fast track reports” defined.
686B.318 “Insurance expense exhibit” defined.
686B.324 “NAIC” defined.
686B.331 “Participating insurer” defined.
686B.336 “Statistical agent” defined.
686B.338 “Statistical plan” defined.
686B.345 Agreements for compilation and analysis of data; duties of statistical agents.
686B.351 Financial reports: General requirements.
686B.361 Statistical reports: Submission of information to statistical agents.
686B.365 Statistical reports: Submission of annual data.
686B.371 Statistical reports: Submission of data for fast track reports.
686B.380 Statistical reports: Submission of fast track reports to Commissioner.
686B.390 Permission for late submission of reports or data.
686B.395 Penalties for failure to file information.
FILING AND USE OF LOSS COSTS
686B.400 Definitions.
686B.405 “Advisory prospective loss costs” defined.
686B.409 “Expenses” defined.
686B.415 “Prospective loss costs” defined.
686B.420 “Rate” defined.
686B.425 “Supplementary rate information” defined.
686B.430 “Supporting information” defined.
686B.435 Applicability of provisions.
686B.440 Reference filings containing advisory prospective loss costs; requirements for filing of rates; adjustments to prospective loss costs.
686B.445 Requirements for filings that refer to reference filings of prospective loss costs.
686B.450 Filing of supplementary rate information.
686B.455 Requirements for filing of final rate pages and submission of rates.
686B.460 Refiling of previously approved rates and loss costs; use of previously filed rates, loss costs and deviations.
MISCELLANEOUS PROVISIONS
686B.500 Filing and forwarding of supporting data regarding rates.
686B.501 Requirements for filing for increase or decrease in rates: Professional liability insurance for certain practitioners.
686B.502 Requirements for filing for increase or decrease in rates: Supplemental personal liability insurance.
686B.503 Requirements for filing for increase or decrease in rates: Homeowners’ insurance or property insurance for dwellings.
686B.504 Policy fees.
686B.505 Required filings; definition of “force-placed insurance.”
686B.520 Approval of rate different from filed rate.
686B.525 Notice of material change in premium based upon change in zip code of policyholders.
686B.530 Exemption of insurance for aviation from certain statutory provisions concerning rates.
686B.550 Examination of rate service organizations.
686B.610 Individual risk premium modification plans.
MOTOR VEHICLE INSURANCE COVERING PRIVATE PASSENGER VEHICLES
686B.700 Definitions.
686B.705 Applicability of provisions.
686B.710 Procedure for filing of rates or forms; acceptance of nonconforming filing prohibited.
686B.715 Supporting data required with filing of rates; exempt filings.
686B.720 Requirements for filing of profitability reports.
686B.725 Hearings to review filings: Issuance and notice of order for hearing; scheduling; procedural requirements.
686B.730 Hearings to review filings: Hearing officer; date; continuance.
686B.735 Hearings to review filings: Intervention; questions and testimony; burden of proof; exhibits; copies of transcripts and other items.
686B.740 Hearings to review filings: Filing of pleadings.
686B.745 Hearings to review filings: Proof of service.
686B.750 Hearings to review filings: Prehearing conference.
686B.755 Hearings to review filings: Official notice.
686B.760 Hearings to review filings: Order of hearing officer.
686B.765 Hearings to review filings: Review of disapproval by hearing officer.
INDUSTRIAL INSURANCE
General Provisions
686B.800 Definitions.
686B.802 “Advisory Organization” defined.
686B.805 “Industrial insurance” defined.
686B.810 “Insurer” defined.
686B.815 “Nevada Workers’ Compensation Insurance Plan” defined.
Nevada Workers’ Compensation Insurance Plan
686B.818 Authority of Advisory Organization.
686B.820 Effective date.
686B.825 Plan Administrator: Appointment; selection of insurer to service plan; notification of termination of management.
686B.830 Requirements of insurers.
686B.835 Distribution of premiums paid and losses incurred.
686B.840 Requirements for qualification for insurance.
Miscellaneous Provisions
686B.843 Filing requirements for final rates and loss cost multipliers; use of loss cost multipliers.
686B.845 Plan for payment of dividends; plan for payment of savings, unearned premium deposits or equivalent abatement for premiums allowed or returned for policy.
GENERAL PROVISIONS
NAC 686B.005 Definitions. As used in this chapter, unless the context otherwise requires:
1. “Commissioner” means the Commissioner of Insurance.
2. “Division” means the Division of Insurance of the Department of Business and Industry.
(Supplied in codification)
NAC 686B.100 Electronic filing of rates, rules and forms and payment of fees. (NRS 679B.130, 679B.136, 680B.010)
1. Any rate, rule or form required to be filed pursuant to the provisions of chapter 686B of NRS must be filed in accordance with the System for Electronic Rate and Form Filing developed and implemented by the National Association of Insurance Commissioners.
2. Any fee required when filing a rate, rule or form pursuant to NRS 680B.010 must be paid using the Electronic Funds Transfer function within the System for Electronic Rate and Form Filing.
(Added to NAC by Comm’r of Insurance by R115-02, eff. 3-18-2003; A by R097-10, 12-16-2010, eff. 12-31-2010)
REPORTING FINANCIAL AND STATISTICAL DATA
NAC 686B.300 Definitions. (NRS 679B.130, 679B.430, 686B.160) As used in NAC 686B.300 to 686B.395, inclusive, unless the context otherwise requires, the words and terms defined in NAC 686B.308 to 686B.338, inclusive, have the meanings ascribed to them in those sections.
(Added to NAC by Comm’r of Insurance, eff. 1-12-89; A by R098-10, 12-16-2010)
NAC 686B.308 “Annual statement” defined. (NRS 679B.130, 679B.430, 686B.160) “Annual statement” means the annual report of an insurer as of each December 31, which provides detailed information on assets and liabilities, including data on premiums, losses, reserves, expenses, dividends, taxes and investments.
(Added to NAC by Comm’r of Insurance, eff. 1-12-89)
NAC 686B.314 “Fast track reports” defined. (NRS 679B.130, 679B.430, 686B.160) “Fast track reports” means information generated from the National Association of Insurance Commissioners’ fast track monitoring system that gives a sampling of significant data for property and casualty insurance on a quarterly basis by insurers comprising a major segment of the market for the types of insurance indicated.
(Added to NAC by Comm’r of Insurance, eff. 1-12-89; A 12-9-91)
NAC 686B.318 “Insurance expense exhibit” defined. (NRS 679B.130, 679B.430, 686B.160) “Insurance expense exhibit” means the supplement to an insurer’s annual statement which provides a detailed analysis of expenses on a net basis for all types of business.
(Added to NAC by Comm’r of Insurance, eff. 1-12-89)
NAC 686B.324 “NAIC” defined. (NRS 679B.130, 679B.430, 686B.160) “NAIC” means the National Association of Insurance Commissioners.
(Added to NAC by Comm’r of Insurance, eff. 1-12-89)
NAC 686B.331 “Participating insurer” defined. (NRS 679B.130, 679B.430, 686B.160) “Participating insurer” means an insurer licensed to transact the business of property and casualty insurance in this State which is a member of or subscribes to the services of a licensed rate service organization.
(Added to NAC by Comm’r of Insurance, eff. 1-12-89; A by R089-17, 5-16-2018)
NAC 686B.336 “Statistical agent” defined. (NRS 679B.130, 679B.430, 686B.160) “Statistical agent” means an organization designated by the Commissioner to gather and compile statistical data relating to the experience of insurers.
(Added to NAC by Comm’r of Insurance, eff. 1-12-89)
NAC 686B.338 “Statistical plan” defined. (NRS 679B.130, 679B.430, 686B.160) “Statistical plan” means a system for collecting and recording information relating to insurance premiums, losses, exposures and expenses.
(Added to NAC by Comm’r of Insurance, eff. 1-12-89)
NAC 686B.345 Agreements for compilation and analysis of data; duties of statistical agents. (NRS 679B.130, 679B.430, 686B.160)
1. The Commissioner may enter into agreements with any qualified data collection service corporation, association or other entity to compile and analyze data collected pursuant to NAC 686B.300 to 686B.395, inclusive.
2. A statistical agent shall:
(a) Collect and compile any data required by NAC 686B.361 to 686B.380, inclusive;
(b) Provide summaries of that information to the Commissioner as he or she may request; and
(c) Make available to the Commissioner a list of any other reports it may compile from that information and furnish a copy of those reports to the Commissioner upon request.
(Added to NAC by Comm’r of Insurance, eff. 1-12-89)
NAC 686B.351 Financial reports: General requirements. (NRS 679B.130, 679B.430, 686B.160) As a condition of doing business in this State, each insurer licensed to transact the business of property and casualty insurance must, in addition to any other reports required, report to the Commissioner financial data for the preceding year as follows:
1. An insurance expense exhibit must be filed with the Commissioner on or before April 1 of each year, or on a later date, if appropriate. The exhibit must provide information from across the country on the insurer’s expenses for the previous calendar year. The exhibit must be in the form prescribed by the National Association of Insurance Commissioners. Information from the insurer’s insurance expense exhibit shall be deemed to be filed with the Commissioner if it is filed at the Central Office of the National Association of Insurance Commissioners, 1100 Walnut Street, Suite 1500, Kansas City, Missouri 64106-2197, on or before April 1 of each year. The information must be filed pursuant to the specifications of the National Association of Insurance Commissioners for filing information for an annual statement on diskette.
2. Other schedules or supplements must be filed as required by the Commissioner. Any additional National Association of Insurance Commissioners’ schedule required by the Commissioner must be in the form prescribed by the National Association of Insurance Commissioners.
(Added to NAC by Comm’r of Insurance, eff. 1-12-89; A 12-9-91)
NAC 686B.361 Statistical reports: Submission of information to statistical agents. (NRS 679B.130, 679B.430, 686B.160) Each insurer licensed to transact the business of property and casualty insurance in this State shall report statistical information regarding its experience to at least one of the statistical agents designated by the Commissioner. The information must be submitted in the form prescribed by NAC 686B.365 to 686B.380, inclusive, and specified in the statistical plans adopted by the Commissioner.
(Added to NAC by Comm’r of Insurance, eff. 1-12-89)
NAC 686B.365 Statistical reports: Submission of annual data. (NRS 679B.130, 679B.430, 686B.160) At least annually, insurers shall submit to a statistical agent, data which conforms to the following specifications:
1. The following types of insurance must be included in the annual data:
(a) Motor vehicle-commercial.
(b) Motor vehicle-private passenger.
(c) Boiler and machinery.
(d) Burglary.
(e) Business owners.
(f) Commercial multiple peril.
(g) Crop-hail.
(h) Farm owners.
(i) Fidelity and surety.
(j) Fire and extended coverage.
(k) General liability.
(l) Glass.
(m) Homeowners.
(n) Inland marine.
(o) Personal property other than homeowners.
(p) Medical professional liability.
2. The following information must be included, by territory, if applicable:
(a) Premiums written.
(b) Premiums earned.
(c) Losses paid.
(d) Allocated loss adjustment expenses paid.
(e) Losses outstanding.
(f) Allocated loss adjustment expenses outstanding.
(g) Number of claims.
(Added to NAC by Comm’r of Insurance, eff. 1-12-89; A by R098-10, 12-16-2010)
NAC 686B.371 Statistical reports: Submission of data for fast track reports. (NRS 679B.130, 679B.430, 686B.160) Data necessary to produce fast track reports must be submitted to the statistical agents by selected insurers within 45 days after the end of the calendar year. The data must be submitted as follows:
1. Fast track quarterly premium and loss data must be submitted for the following types of insurance:
(a) Private passenger liability.
(b) Private passenger physical damage.
(c) Commercial motor vehicle liability.
(d) Commercial motor vehicle physical damage.
(e) Homeowners.
(f) Dwelling fire.
(g) Dwelling allied lines.
(h) Commercial fire.
(i) Commercial allied lines.
(j) Farm business.
(k) Commercial multiple peril.
(l) Liability other than motor vehicle.
(m) Medical malpractice.
2. Claim cost and claim severity data must be included for the following types of insurance:
(a) Private passenger comprehensive.
(b) Private passenger collision.
(c) Private passenger bodily injury liability.
(d) Private passenger property damage liability.
(e) Private passenger personal injury protection, if applicable.
(Added to NAC by Comm’r of Insurance, eff. 1-12-89)
NAC 686B.380 Statistical reports: Submission of fast track reports to Commissioner. (NRS 679B.130, 679B.430, 686B.160) Statistical agents shall provide fast track reports to the Commissioner within 60 days after the close of the calendar quarter for private passenger motor vehicle insurance and homeowners insurance. Fast track reports for other types of insurance must be provided within 75 days after the close of the calendar quarter.
(Added to NAC by Comm’r of Insurance, eff. 1-12-89; A by R098-10, 12-16-2010)
NAC 686B.390 Permission for late submission of reports or data. (NRS 679B.130, 679B.430, 686B.160) Upon application by a statistical agent or an insurer, the Commissioner may allow the submission of a report or statistical data on a date which is later than that required by NAC 686B.300 to 686B.380, inclusive, if the submission of the report or data on the date required would create a substantial hardship to the statistical agent or insurer.
(Added to NAC by Comm’r of Insurance, eff. 1-12-89; A by R089-17, 5-16-2018)
NAC 686B.395 Penalties for failure to file information. (NRS 679B.130, 679B.430, 686B.160) Failure to file the information required by NAC 686B.300 to 686B.390, inclusive, pursuant to the statistical plan adopted by the Commissioner may result in the imposition of the penalties prescribed by NRS 679B.460, 680A.200 or 680A.280.
(Added to NAC by Comm’r of Insurance, eff. 1-12-89; A by R143-12, 11-1-2012)
FILING AND USE OF LOSS COSTS
NAC 686B.400 Definitions. (NRS 679B.130, 686B.070, 686B.100) As used in NAC 686B.400 to 686B.460, inclusive, unless the context otherwise requires, the words and terms defined in NAC 686B.405 to 686B.430, inclusive, have the meanings ascribed to them in those sections.
(Added to NAC by Comm’r of Insurance, eff. 6-20-90)
NAC 686B.405 “Advisory prospective loss costs” defined. (NRS 679B.130, 686B.070, 686B.100) “Advisory prospective loss costs” means the prospective loss costs filed by a rate service organization with the Commissioner.
(Added to NAC by Comm’r of Insurance, eff. 6-20-90)
NAC 686B.409 “Expenses” defined. (NRS 679B.130, 686B.070, 686B.100) “Expenses” means the portion of a rate that is attributable to the costs of acquisition, field supervision, collection expenses, general expenses, taxes, licenses and fees.
(Added to NAC by Comm’r of Insurance, eff. 6-20-90)
NAC 686B.415 “Prospective loss costs” defined. (NRS 679B.130, 686B.070, 686B.100) “Prospective loss costs” means the portion of a rate that is based on historical aggregate losses and loss adjustment expenses which are adjusted to their ultimate value and projected to a future point in time. Except as otherwise provided in this section, the term does not include provisions for expenses or profit.
(Added to NAC by Comm’r of Insurance, eff. 6-20-90)
NAC 686B.420 “Rate” defined. (NRS 679B.130, 686B.070, 686B.100) “Rate” means the cost of insurance per exposure unit and may be expressed as a single number or as prospective loss costs that include an adjustment to account for the treatment of expenses, profit and variations in loss experience before individual risk variations based on loss or expense are applied. The term does not include minimum premiums.
(Added to NAC by Comm’r of Insurance, eff. 6-20-90)
NAC 686B.425 “Supplementary rate information” defined. (NRS 679B.130, 686B.070, 686B.100) In addition to the kinds of information listed in subsection 4 of NRS 686B.020, “supplementary rate information” includes any classification system, code or description of a territory, rating plan and other information needed to determine the applicable premium for an insured. The term includes factors and relativities such as increased limit factors, classification relativities and deductible relativities.
(Added to NAC by Comm’r of Insurance, eff. 6-20-90)
NAC 686B.430 “Supporting information” defined. (NRS 679B.130, 686B.070, 686B.100) “Supporting information” includes:
1. The experience and judgment of the filer and the experience or data of other insurers or organizations relied upon by the filer;
2. The interpretation of any statistical data relied upon by the filer;
3. A description of the method used in making the rates; and
4. Any other information required by the Commissioner to be filed.
(Added to NAC by Comm’r of Insurance, eff. 6-20-90)
NAC 686B.435 Applicability of provisions. (NRS 679B.130, 686B.070, 686B.100) Except as otherwise provided in NRS 686B.040, NAC 686B.400 to 686B.460, inclusive, applies to:
1. Insurers writing the kinds and lines of direct insurance not exempted by NRS 686B.030; and
2. Insurers and rate service organizations making filings pursuant to NRS 686B.070.
(Added to NAC by Comm’r of Insurance, eff. 6-20-90)
NAC 686B.440 Reference filings containing advisory prospective loss costs; requirements for filing of rates; adjustments to prospective loss costs. (NRS 679B.130, 686B.070, 686B.100)
1. A rate service organization may develop and make a reference filing containing advisory prospective loss costs.
2. The reference filing must:
(a) Contain statistical data and supporting information for any calculation or assumption underlying the prospective loss costs; and
(b) Be filed and effective in the same manner as rates filed pursuant to chapter 686B of NRS.
3. An insurer may make a filing of rates by:
(a) Becoming a participating insurer of a licensed rate service organization that makes reference filings of advisory prospective loss costs;
(b) Filing with the Commissioner the information required by NAC 686B.445; and
(c) Authorizing the Commissioner to accept a reference filing on its behalf.
4. The rates of the insurer must include:
(a) The prospective loss costs filed by the rate service organization pursuant to subsection 1; and
(b) Any adjustment to the prospective loss costs filed as required by NAC 686B.445 that are in effect for that insurer.
5. The filing of an adjustment to the prospective loss costs by an insurer becomes effective in the same manner as rates filed pursuant to chapter 686B of NRS.
(Added to NAC by Comm’r of Insurance, eff. 6-20-90)
NAC 686B.445 Requirements for filings that refer to reference filings of prospective loss costs. (NRS 679B.130, 686B.070, 686B.100)
1. A filing by an insurer that refers to a reference filing of prospective loss costs made by a rate service organization must include, without limitation, a completed copy of the NAIC Loss Cost Filing Document adopted by reference pursuant to subsection 2 or a reference filing adoption form that is substantially similar to the NAIC Loss Cost Filing Document and a summary of supporting information.
2. The Commissioner hereby adopts by reference the NAIC Loss Cost Filing Document published by the National Association of Insurance Commissioners. A copy of the document is available free of charge from the National Association of Insurance Commissioners at the Internet address http://www.naic.org.
(Added to NAC by Comm’r of Insurance, eff. 6-20-90; A 5-27-92; R083-06 & R099-06, 6-28-2006)
NAC 686B.450 Filing of supplementary rate information. (NRS 679B.130, 686B.070, 686B.100)
1. A rate service organization may develop and make a filing of supplementary rate information in accordance with the provisions of NRS 686B.010 to 686B.175, inclusive.
2. An insurer may make a filing of supplementary rate information by:
(a) Becoming a participating insurer of a licensed rate service organization; and
(b) Authorizing the Commissioner to accept a filing by the organization on behalf of the insurer.
3. Except for any modification filed by the insurer, the supplementary rate information of the insurer must be the same as that filed by the rate service organization.
(Added to NAC by Comm’r of Insurance, eff. 6-20-90)
NAC 686B.455 Requirements for filing of final rate pages and submission of rates. (NRS 679B.130, 686B.070, 686B.100)
1. If the final rates of an insurer are determined by applying its adjustment to the prospective loss costs, as presented in the reference filing adoption form, to the prospective loss costs that are contained in the reference filing and printed in the rating manual of the rating organization, the insurer is not required to develop or file its final rate pages with the Commissioner.
2. If an insurer prints and distributes final rate pages for its own use and the rates are based on the application of its filed adjustments to the prospective loss costs of a rating organization, the insurer must file those pages with the Commissioner.
3. If a rating organization does not print prospective loss costs in its rating manual, the insurer must submit its rates to the Commissioner.
(Added to NAC by Comm’r of Insurance, eff. 6-20-90)
NAC 686B.460 Refiling of previously approved rates and loss costs; use of previously filed rates, loss costs and deviations. (NRS 679B.130, 686B.070, 686B.100)
1. Except as otherwise provided in subsection 2, NAC 686B.400 to 686B.460, inclusive, do not require a rate service organization or its participating insurers to refile a rate or loss cost previously approved by the Commissioner.
2. A participating insurer of a rate service organization may continue to use any rate, loss cost or deviation filed and approved for its use until:
(a) The rate, loss cost or deviation is disapproved; or
(b) The insurer makes its own filing to change its rate by making an independent filing or by filing a reference filing adoption form that adopts the prospective rates or loss costs of a rate service organization or an adjustment to the prospective rates or loss costs by the insurer.
3. The provisions of this section do not apply to the filing of a rate, loss cost or deviation relating to a policy of industrial insurance.
(Added to NAC by Comm’r of Insurance, eff. 6-20-90; A by R099-06, 6-28-2006)
MISCELLANEOUS PROVISIONS
NAC 686B.500 Filing and forwarding of supporting data regarding rates. (NRS 679B.130, 686B.100)
1. An insurer or rate service organization shall promptly forward to the Division any of the following information requested by the Division for each filing of supporting data required by the Commissioner pursuant to NRS 686B.100:
(a) Relevant profitability reports.
(b) Descriptions of the components of losses.
(c) Components of expenses for both current and proposed rates, excluding the items for loss adjustment expenses.
(d) Income earned on the money of policyholders that is expressed as a percentage of earned premium.
(e) Any other related matters or actuarial information that is requested.
2. An insurer or rate service organization shall, at the request of the Division, forward a copy of the filing to any other person named by the Division. The insurer or rate service organization shall provide to the Division satisfactory proof that the filing was forwarded to that person.
(Added to NAC by Comm’r of Insurance, eff. 1-27-92)
NAC 686B.501 Requirements for filing for increase or decrease in rates: Professional liability insurance for certain practitioners. (NRS 679B.130, 686B.070, 686B.100, 686B.110)
1. A filing for an increase or decrease in rates for professional liability insurance for practitioners licensed pursuant to chapters 630 to 640, inclusive, of NRS must:
(a) Include a profitability report in the form prescribed by the Commissioner;
(b) Identify the largest theoretical rate increase proposed by the filing; and
(c) Identify the components of the rate increase.
2. The profitability report required by subsection 1 must:
(a) Include the statistical test, including, if applicable, the “students t” test, used to justify the proposed differences in rates by territory, or, if a statistical test is not provided, an explanation as to the reason why a test was not provided; and
(b) Be certified by an officer of the insurer as to its accuracy.
3. The Division’s actuary may specify, where reserve charges are coded to a specific year, the years in which accidents have occurred, commonly referred to as “calendar accident years,” that the insurer must include in the profitability report.
4. Unless otherwise required by the Commissioner, if an insurer has previously submitted a profitability report, the new report must include updated numbers for all calendar accident years in the previous report and all subsequent years in which accidents have occurred for a maximum reporting period of 10 years.
5. The insurer and the Division’s actuary may agree to use the data from the fiscal year in which accidents have occurred, commonly referred to as “fiscal accident year,” as the basis for profitability reports.
(Added to NAC by Comm’r of Insurance, eff. 5-15-96)
NAC 686B.502 Requirements for filing for increase or decrease in rates: Supplemental personal liability insurance. (NRS 679B.130, 686B.070, 686B.100, 686B.110) A filing for an increase or decrease in rates for supplemental personal liability insurance must:
1. Identify the largest theoretical rate increase proposed by the filing; and
2. Identify the components of the rate increase.
(Added to NAC by Comm’r of Insurance, eff. 5-15-96)
NAC 686B.503 Requirements for filing for increase or decrease in rates: Homeowners’ insurance or property insurance for dwellings. (NRS 679B.130, 686B.070, 686B.100, 686B.110) A filing for an increase or decrease in rates for homeowners’ insurance or for property insurance for dwellings, commonly referred to as “dwelling fire insurance,” must:
1. Identify the largest theoretical rate increase proposed by the filing; and
2. Identify the contribution of each component of the increase, including, but not limited to, the contribution of the amount of insurance, the protection class, the territory and the construction class.
(Added to NAC by Comm’r of Insurance, eff. 5-15-96)
NAC 686B.504 Policy fees. (NRS 679B.130, 686B.070)
1. A policy fee must comply with the provisions set forth in NRS 686B.050 and 686B.060.
2. An insurer who charges a policy fee shall file the fee with the Commissioner pursuant to NRS 686B.070.
3. An insurer shall not charge a policy fee for the renewal of a policy of insurance.
4. As used in this section, “policy fee” means a charge imposed by an insurer for the issuance of a policy of insurance.
(Added to NAC by Comm’r of Insurance by R151-99, eff. 1-28-2000)
NAC 686B.505 Required filings; definition of “force-placed insurance.” (NRS 679B.130, 686B.030)
1. The Commissioner will interpret subsection 2 of NRS 686B.030 as requiring the following filings:
(a) Policy coverage forms, endorsements, application forms and declarations pages for all business and commercial insurance.
(b) Rules, rates, policy coverage forms, endorsements, application forms and declarations pages for the following types of insurance:
(1) Dwelling, up to 4 units;
(2) Personal inland marine, including, but not limited to, personal watercraft;
(3) Vehicle mechanical breakdown;
(4) Insurance for home protection which is regulated pursuant to NRS 690B.100 to 690B.180, inclusive; and
(5) Force-placed insurance.
2. As used in this section, “force-placed insurance” means single interest or dual interest insurance that is purchased by a creditor after a transaction:
(a) For coverage against loss, expense or damage to the property used as collateral as a result of fire, theft, collision or other risk of loss that would impair the interest of the creditor or adversely affect the value of the collateral;
(b) In accordance with the terms of the credit agreement as a result of the debtor’s failure to provide the required insurance; and
(c) The cost of which is charged to the debtor.
(Added to NAC by Comm’r of Insurance, eff. 12-15-94; A by R111-04, 5-24-2005; R006-16, 6-28-2016)
NAC 686B.520 Approval of rate different from filed rate. (NRS 679B.130, 686B.070, 686B.110)
1. An insurance company which requires a rate different from the rate provided by a filing otherwise applicable to a specific risk may request the different rate by written application to the Commissioner for approval or disapproval.
2. An application must:
(a) Include one copy of the face of the policy.
(b) Show a comparison of the filed rate to the requested rate.
(c) Give a brief statement of steps which the insured can take to improve his or her insurability and qualify for a lower rate if the requested rate is in excess of the filed rate.
(d) Provide a space for the insured or a representative to sign as evidence of consent to the requested rate.
(e) Give any other information required by the Commissioner.
[Comm’r of Insurance, PC-2, eff. 9-23-72] — (NAC A by R111-04, 5-24-2005)
NAC 686B.525 Notice of material change in premium based upon change in zip code of policyholders. (NRS 679B.130, 686B.119)
1. If an insurer proposes to increase materially the premium rate of a policyholder solely because the zip code assigned to the address of the policyholder is changed by the United States Postal Service, the insurer shall notify the insured of the proposed change in the rate:
(a) For a policy with a term of 31 days or less, at least 30 days before the increase in premium becomes effective; and
(b) For any other policy, at least 30 days before the next date on which the policy could be renewed.
2. An insurer who fails to provide notice required by this section shall renew the policy pursuant to the terms of the current, expiring policy.
3. As used in this section, the term “increase materially” means an increase of 10 percent or more of the total premium of the policy.
(Added to NAC by Comm’r of Insurance, eff. 12-15-94)
NAC 686B.530 Exemption of insurance for aviation from certain statutory provisions concerning rates. (NRS 679B.130, 686B.040) Classes of insurance relating to insurance for aviation are exempt from the provisions of NRS 686B.010 to 686B.125, inclusive.
(Added to NAC by Comm’r of Insurance, eff. 9-19-90)
NAC 686B.550 Examination of rate service organizations. (NRS 679B.130, 686B.170)
1. Except as otherwise provided in subsection 2, the Commissioner will, as often as the Commissioner deems advisable, examine the affairs and conditions of each rate service organization in accordance with the provisions of NRS 686B.170.
2. The Commissioner will examine the affairs and conditions of each licensed rate service organization not less frequently than every 5 years.
(Added to NAC by Comm’r of Insurance by R099-06, eff. 6-28-2006)
NAC 686B.610 Individual risk premium modification plans. (NRS 679B.130, 686B.070, 686B.100)
1. For the purposes of this section, “schedule rating” means application of judgment credits and debits to the risk rate or premium charge which has been developed through the use of base rate or class rate modified by:
(a) Package discounts where applicable; and
(b) Any other approved rating plan which does not duplicate credits or debits.
2. The Commissioner will accept individual risk premium modification plans if:
(a) Schedule-rating factors apply only to individual risk characteristics which reflect potential hazards.
(b) Schedule rating applies only to risks which develop at least $500 annual premium or $1,500 3-year prepaid premium. When schedule credits are being applied, the resulting premium must be $500 or more for 1 year, or $1,500 or more for 3 years.
(c) The schedule-rating plan must provide for debits and credits, and is subject to maximum total debits or credits of 25 percent.
(d) No risk may be modified except after inspection of the property. The insurer shall retain adequate supporting data, including copies of inspection reports, which may be inspected by the Division.
3. Each filing of an individual risk premium modification plan must be accompanied by a statement by the filing official affirming that the filing conforms to the provisions of this section.
4. This section does not apply to automobile liability, automobile physical damage, general liability, medical malpractice liability, burglary, glass, fidelity or boiler and machinery rating plans.
[Comm’r of Insurance, PC-16, eff. 9-23-72] — (NAC A by R072-02, 7-12-2002)
MOTOR VEHICLE INSURANCE COVERING PRIVATE PASSENGER VEHICLES
NAC 686B.700 Definitions. (NRS 679B.130) As used in NAC 686B.700 to 686B.765, inclusive, unless the context otherwise requires:
1. “Hearing officer” means the Commissioner or a person designated by the Commissioner to conduct a hearing.
2. “Insurer” means an insurer whose rates or forms are the subject of any hearing conducted pursuant to NAC 686B.730 to 686B.765, inclusive.
(Added to NAC by Comm’r of Insurance, eff. 1-27-92)
NAC 686B.705 Applicability of provisions. (NRS 679B.130, 686B.070) NAC 686B.700 to 686B.765, inclusive, apply to the filing of rates and forms for motor vehicle insurance covering private passenger vehicles.
(Added to NAC by Comm’r of Insurance, eff. 1-27-92)
NAC 686B.710 Procedure for filing of rates or forms; acceptance of nonconforming filing prohibited. (NRS 679B.130, 686B.070)
1. The Division shall prescribe the procedure to be followed by insurers for the filing of rates or forms. The procedure must be made available upon request.
2. The Division shall not accept any filing that does not conform to its requirements.
(Added to NAC by Comm’r of Insurance, eff. 1-27-92)
NAC 686B.715 Supporting data required with filing of rates; exempt filings. (NRS 679B.130, 686B.070, 686B.100)
1. A filing of rates made pursuant to NRS 686B.070 must contain:
(a) The supporting data listed in NRS 686B.100 and NAC 686B.500.
(b) The following supporting data, which must be listed on the current “NV PC1” form which is available from the Division:
(1) The name of the insurer.
(2) By territory, the percentage of change in the base rates for:
(I) Liability for bodily injury;
(II) Liability for property damage;
(III) Coverage for uninsured or underinsured motorists;
(IV) Medical payments;
(V) Comprehensive coverage; and
(VI) Collision coverage.
(3) If necessary, for each of those base rates, any changes in:
(I) Territory;
(II) Age, sex or marital status;
(III) Coverage for one vehicle or more than one vehicle; and
(IV) Use categories.
(4) The largest theoretical rate increase resulting from a combination of factors in subparagraph (3), a listing of the contribution of each component and the compound result of all components.
(5) If applicable, the adjustment of variable expenses to fixed expenses, commonly referred to as “expense flattening.”
(6) If necessary, for each of the factors listed in subparagraph (3), a separate list of the factors for the balancing of increases and decreases of components to achieve a preselected overall change in rates, commonly referred to as “off-balance factors.”
(7) For each of the coverages listed in subparagraph (2), the written premium at current rates for a recent 12-month period and the requested change in rates indicated by percentage and amount in dollars.
(8) The total number of vehicles insured for bodily injury or property damage which are principally kept in this State and the percentage of those vehicles insured in each territory of the insurer. The Commissioner may, at the request of the insurer, allow the information required by this paragraph to be submitted separately to the Division and to be deemed confidential pursuant to subsection 5 of NRS 679B.190.
(9) The total number of vehicles insured and principally kept in this State.
(10) A statement by the insurer explaining why the filing meets the standards of NRS 686B.050 and 686B.060.
(11) A statement by the insurer describing the actions it has taken to reduce costs for motor vehicle insurance covering private passenger vehicles, including programs:
(I) To reduce the insurer’s own operational or other expenses.
(II) To reduce fraudulent claims.
(III) For the management of medical cases or other programs to contain medical costs.
(IV) To reduce the costs of repairing vehicles.
(V) For risk management, loss prevention, safety, and the training or education of drivers that are promoted by the insurer.
(c) A cover letter or filing memorandum which summarizes the filing and includes:
(1) A statement as to whether the policy allows the proration or other limitation of coverage, commonly referred to as the “stacking” of coverage for:
(I) Medical payments; or
(II) Uninsured and underinsured motorists.
(2) A verification that the insurer has complied with:
(I) Subsection 1 of NAC 690B.240;
(II) Subsections 2 and 3 of NRS 687B.145; and
(III) Division Bulletin No. 89-002.
(d) A statement concerning chargeable accidents which must include:
(1) A copy of the rules of the insurer concerning chargeable accidents; and
(2) An explanation as to how the dollar threshold was established for a chargeable accident.
(e) A list of all discounts required by title 57 of NRS which an insurer offers on premiums with a reference to the page number in the manual of the insurer which describes the discount.
(f) A copy of the evidence of insurance provided to the insured pursuant to NRS 690B.023.
(g) If the filing is made by an insurer providing coverage for at least 15,000 vehicles principally kept in this State, a list of the 10 largest losses for each of the most recent 5 years, with the status of the claim as either open or closed for:
(1) Liability for bodily injury;
(2) Coverage for uninsured and underinsured motorists; and
(3) Coverage for medical payments.
(h) A distribution of policy limits by the number of insureds for:
(1) Liability for bodily injury;
(2) Coverage for uninsured or underinsured motorists; and
(3) Coverage for medical payments.
(i) A distribution of the number of insured vehicles with:
(1) Collision coverage;
(2) Comprehensive coverage; and
(3) Collision and comprehensive coverage.
(j) The description of each territory used by the insurer.
(k) The ratios which compare the base rates of the insurer for the lowest and highest rated territories for:
(1) Liability for bodily injury;
(2) Coverage for uninsured and underinsured motorists;
(3) Coverage for medical payments;
(4) Comprehensive coverage; and
(5) Collision coverage.
(l) Actuarial exhibits which demonstrate generally accepted actuarial principles, including:
(1) Actuarial models used in the filing;
(2) Indications of necessary rate level changes;
(3) Credibility models;
(4) Development of trend factors;
(5) Development of relativity factors;
(6) Loss development triangles;
(7) Loss development factors;
(8) Permissible loss ratios; and
(9) Other actuarial data relevant to the filing.
(m) An index of all exhibits and documents included in the filing.
2. The provisions of this section do not apply to the filing of prospective loss costs by a licensed rate service organization. As used in this subsection, “prospective loss costs” has the meaning ascribed to it in NAC 686B.415.
(Added to NAC by Comm’r of Insurance, eff. 1-27-92; A 5-15-96)
NAC 686B.720 Requirements for filing of profitability reports. (NRS 679B.130, 686B.070, 686B.100, 686B.110)
1. An insurer or group of insurers that is insuring more than 2,000 vehicles principally kept in this State must include a profitability report with all filings for an increase or decrease in rates.
2. A profitability report must be in the form required by the Division and certified by an officer of the insurer as to its accuracy.
3. The Division’s actuary may specify, where reserve charges are coded to a specific year, the years in which accidents have occurred, commonly referred to as “calendar accident years,” that the insurer must include in the profitability report.
4. Unless otherwise required by the Commissioner, if an insurer has previously submitted a profitability report, the new report must include updated numbers for all calendar accident years in the previous report and all subsequent years in which accidents have occurred for a maximum reporting period of 10 years.
5. The insurer and the Division’s actuary may agree to use the data from the fiscal year in which accidents occurred, commonly referred to as “fiscal accident year,” as the basis for the profitability reports.
6. The Division’s actuary may specify that a profitability report filed by an insurer providing coverage for at least 60,000 vehicles principally kept in this State must include profitability by territory.
(Added to NAC by Comm’r of Insurance, eff. 1-27-92; A 5-15-96)
NAC 686B.725 Hearings to review filings: Issuance and notice of order for hearing; scheduling; procedural requirements. (NRS 679B.130, 679B.310, 679B.320, 686B.110)
1. If the Commissioner deems it appropriate, the Commissioner will issue an order for a hearing to allow consideration of a filing and send the order by certified mail to the insurer not less than 20 days before the hearing. A copy of the order will be posted at the Division’s offices and at the location of the hearing.
2. If an order is issued pursuant to subsection 1, the hearing must be scheduled to enable the Commissioner to make his or her decision within the time authorized for each proposed increase in the rate of any kind or line of insurance or subdivision thereof by subsection 1 of NRS 686B.110, unless the parties stipulate to a later date.
3. A hearing conducted pursuant to the provisions of this section will comply with the procedural requirements for a hearing set forth in NAC 686B.730 to 686B.765, inclusive.
(Added to NAC by Comm’r of Insurance, eff. 1-27-92)
NAC 686B.730 Hearings to review filings: Hearing officer; date; continuance. (NRS 679B.130, 679B.310, 679B.330, 686B.110)
1. A hearing conducted to review the filing of rates or forms must be held before the Commissioner or a hearing officer designated by the Commissioner.
2. A hearing may be set for a date which is earlier than the date set forth in the notice of the hearing if the Division and the insurer agree in writing. Public notice must be given for any change of the date of a hearing.
3. Upon the written request of the Division, a party, an intervener or an insurer, the hearing officer may:
(a) Continue the hearing until a later date; or
(b) Upon good cause shown, continue the hearing for the submission of further proof on any matter.
(Added to NAC by Comm’r of Insurance, eff. 1-27-92)
NAC 686B.735 Hearings to review filings: Intervention; questions and testimony; burden of proof; exhibits; copies of transcripts and other items. (NRS 679B.130, 679B.310, 679B.330, 686B.110)
1. No person other than the insurer or a person insured by the insurer may intervene in any hearing conducted to review the filing of rates or forms by the insurer.
2. Any person who intends to submit questions or testimony for the hearing shall submit the questions or testimony to the hearing officer in writing not less than 5 days before the hearing. The hearing officer may ask those questions or submit that testimony for the record.
3. Only parties to the hearing may ask questions at the hearing. At the discretion of the hearing officer, any person may offer oral or written testimony before or during the hearing.
4. The insurer has the burden to prove:
(a) Its compliance with chapter 686B of NRS; and
(b) Any action it claims it has taken to reduce the costs of coverage.
5. The following exhibits may be entered into the record:
(a) The insurer’s filing of rates or forms and any supporting data or documents received by the Division; and
(b) Any additional information presented by the insurer, a party, an intervener, the Division or any other interested person.
6. Upon payment of the appropriate costs, any person may request, in writing, a copy of the transcript of the hearing or any documents or other items submitted for the filing of rates or the hearing.
(Added to NAC by Comm’r of Insurance, eff. 1-27-92; A 5-15-96)
NAC 686B.740 Hearings to review filings: Filing of pleadings. (NRS 679B.130, 679B.310, 686B.110) All pleadings, including complaints, petitions, answers, briefs, motions, affidavits and applications, must be addressed to the Commissioner. A pleading shall be deemed to be officially filed with the Commissioner at the time a true copy is received by the Division.
(Added to NAC by Comm’r of Insurance, eff. 1-27-92)
NAC 686B.745 Hearings to review filings: Proof of service. (NRS 679B.130, 679B.310, 686B.110) An acknowledgment of service or a certificate in substantially the following form must appear on all documents required to be served:
I hereby certify that I have this date served the foregoing document upon all parties of record in this proceeding (by delivering a copy thereof in person to ...................................) (by mailing a copy thereof, properly addressed, with postage prepaid, to ...................................)
DATED at ..................., this ............(day) of ...................(month) of ...........(year)
.......................................................................Signature
(Added to NAC by Comm’r of Insurance, eff. 1-27-92)
NAC 686B.750 Hearings to review filings: Prehearing conference. (NRS 679B.130, 679B.310, 686B.110)
1. The hearing officer may, upon the motion of the hearing officer or the Division, a party, an intervener or an insurer, by giving reasonable notice of the time and place, hold a prehearing conference to:
(a) Formulate or simplify the issues;
(b) Obtain admissions of fact and documents in order to avoid unnecessary offers of proof;
(c) Arrange for the exchange of proposed exhibits or prepared expert testimony;
(d) Limit the number of witnesses; or
(e) Consider any factor which may permit rapid, orderly conduct and the disposition of the proceedings.
2. Any action taken at a prehearing conference and any agreement, admission or stipulation made at the conference must be made a part of the record and must be approved by the Division and the insurer. If approved, such action controls the course of subsequent proceedings, unless otherwise stipulated by the Division, the party, the intervener, if any, and the insurer. The hearing officer must consent to any such stipulation.
(Added to NAC by Comm’r of Insurance, eff. 1-27-92)
NAC 686B.755 Hearings to review filings: Official notice. (NRS 679B.130, 679B.310, 686B.110) The hearing officer may take official notice of:
1. Rules, regulations, official reports, decisions and orders of any regulatory agency of this State or any court of law.
2. The contents of decisions, orders, certificates, licenses and records maintained or issued by the Division.
(Added to NAC by Comm’r of Insurance, eff. 1-27-92)
NAC 686B.760 Hearings to review filings: Order of hearing officer. (NRS 679B.130, 679B.310, 686B.110)
1. The hearing officer shall file a copy of any order entered pursuant to NAC 686B.700 to 686B.765, inclusive, with the Division. The copy must be made available for public inspection.
2. If the hearing officer is not the Commissioner, the Commissioner will indicate on the order his or her concurrence or dissent with the order of the hearing officer.
(Added to NAC by Comm’r of Insurance, eff. 1-27-92)
NAC 686B.765 Hearings to review filings: Review of disapproval by hearing officer. (NRS 679B.130, 679B.310, 686B.110)
1. If proposed rates are disapproved by an order of the hearing officer:
(a) The insurer may request a hearing as provided in subsection 5 of NRS 686B.110; or
(b) The parties may, by stipulation, declare that a hearing held pursuant to NAC 686B.730 to 686B.765, inclusive, shall be deemed a hearing to determine the validity of the action as provided in subsection 5 of NRS 686B.110, in order to allow the insurer to seek judicial review of the order.
2. If the insurer requests a hearing as provided in subsection 5 of NRS 686B.110, the hearing must be conducted as a hearing de novo.
(Added to NAC by Comm’r of Insurance, eff. 1-27-92)
INDUSTRIAL INSURANCE
General Provisions
NAC 686B.800 Definitions. (NRS 679B.130) As used in NAC 686B.800 to 686B.845, inclusive, unless the context otherwise requires, the words and terms defined in NAC 686B.802 to 686B.815, inclusive, have the meanings ascribed to them in those sections.
(Added to NAC by Comm’r of Insurance by R091-98, eff. 11-2-98; A by R196-99, 1-27-2000; R099-06, 6-28-2006)
NAC 686B.802 “Advisory Organization” defined. (NRS 679B.130) “Advisory Organization” has the meaning ascribed to it in NRS 686B.1752.
(Added to NAC by Comm’r of Insurance by R196-99, eff. 1-27-2000)
NAC 686B.805 “Industrial insurance” defined. (NRS 679B.130) “Industrial insurance” means insurance which provides the compensation required by chapters 616A to 617, inclusive, of NRS and employer’s liability insurance provided in connection with that insurance.
(Added to NAC by Comm’r of Insurance by R091-98, eff. 11-2-98)
NAC 686B.810 “Insurer” defined. (NRS 679B.130) “Insurer” means all private carriers authorized to provide industrial insurance in this State.
(Added to NAC by Comm’r of Insurance by R091-98, eff. 11-2-98)
NAC 686B.815 “Nevada Workers’ Compensation Insurance Plan” defined. (NRS 679B.130, 686B.1771) “Nevada Workers’ Compensation Insurance Plan” means the plan submitted by the Advisory Organization pursuant to subsection 2 of NRS 686B.1771 for the equitable apportionment among insurers of those persons who in good faith are entitled to industrial insurance but who have not been accepted by an insurer.
(Added to NAC by Comm’r of Insurance by R091-98, eff. 11-2-98)
Nevada Workers’ Compensation Insurance Plan
NAC 686B.818 Authority of Advisory Organization. (NRS 679B.130, 686B.1771) The Advisory Organization may file with the Commissioner a program of group insurance for persons who have not been accepted by an insurer.
(Added to NAC by Comm’r of Insurance by R196-99, eff. 1-27-2000)
NAC 686B.820 Effective date. (NRS 679B.130, 686B.1771) The Nevada Workers’ Compensation Insurance Plan becomes effective on July 1, 1999.
(Added to NAC by Comm’r of Insurance by R091-98, 11-2-98, eff. 7-1-99)
NAC 686B.825 Plan Administrator: Appointment; selection of insurer to service plan; notification of termination of management. (NRS 679B.130, 686B.1771)
1. The Commissioner will appoint a Plan Administrator to perform the day-to-day management of the Nevada Workers’ Compensation Insurance Plan.
2. The Plan Administrator shall select, pursuant to the rules of competitive bidding, at least one insurer to service the Nevada Workers’ Compensation Insurance Plan. Each insurer selected pursuant to this section must be approved by the Commissioner.
3. The Plan Administrator shall notify the Commissioner at least 180 days before the Plan Administrator terminates his or her management of the Nevada Workers’ Compensation Insurance Plan.
(Added to NAC by Comm’r of Insurance by R091-98, eff. 11-2-98)
NAC 686B.830 Requirements of insurers. (NRS 679B.130, 686B.1771)
1. Each insurer providing industrial insurance in this State shall:
(a) Participate in the Nevada Workers’ Compensation Insurance Plan; and
(b) Subscribe to the Articles of Agreement of the National Workers’ Compensation Reinsurance Pool,
Ê which are hereby adopted by reference.
2. Copies of the Nevada Workers’ Compensation Insurance Plan and the Articles of Agreement of the National Workers’ Compensation Reinsurance Pool may be obtained, free of charge, from the National Council on Compensation Insurance, Customer Service Center, 901 Peninsula Corporate Circle, Boca Raton, Florida 33487, telephone (800) 622-4123.
(Added to NAC by Comm’r of Insurance by R091-98, 11-2-98, eff. 7-1-99; A by R111-04, 5-24-2005)
NAC 686B.835 Distribution of premiums paid and losses incurred. (NRS 679B.130, 686B.1771)
1. The premiums paid and losses incurred by insurers for industrial insurance provided pursuant to the Nevada Workers’ Compensation Insurance Plan must be:
(a) Ceded first to the National Workers’ Compensation Reinsurance Pool; and
(b) Redistributed periodically based on the proportionate voluntary market share of each participant in the pool, as set forth in:
(1) The Articles of Agreement of the National Workers’ Compensation Reinsurance Pool; or
(2) The Quota Share Reinsurance Agreement of the National Council on Compensation Insurance, which is hereby adopted by reference.
2. A copy of the Quota Share Reinsurance Agreement of the National Council on Compensation Insurance may be obtained, free of charge, from the National Council on Compensation Insurance, Customer Service Center, 901 Peninsula Corporate Circle, Boca Raton, Florida 33487, telephone (800) 622-4123.
(Added to NAC by Comm’r of Insurance by R091-98, 11-2-98, eff. 7-1-99; A by R111-04, 5-24-2005)
NAC 686B.840 Requirements for qualification for insurance. (NRS 679B.130, 686B.1771)
1. To qualify for insurance under the Nevada Workers’ Compensation Insurance Plan, an employer must have been declined coverage by at least two insurers that are not affiliated with each other.
2. The provisions of subsection 1 must not be construed to prohibit an employer from continuing to apply for industrial insurance after the employer has been declined coverage by two qualified insurers.
(Added to NAC by Comm’r of Insurance by R091-98, 11-2-98, eff. 7-1-99; A by R091-98, 11-2-98, eff. 1-1-2001; R196-99, 1-27-2000)
Miscellaneous Provisions
NAC 686B.843 Filing requirements for final rates and loss cost multipliers; use of loss cost multipliers. (NRS 679B.130, 686B.1775)
1. For each filing of final rates or loss cost multipliers for policies of industrial insurance made pursuant to NRS 686B.1775, the insurer:
(a) Shall complete and include, without limitation:
(1) If an expense constant applies, Expense Worksheet A, which is prescribed by the Commissioner; or
(2) If an expense constant does not apply, Expense Worksheet B, which is prescribed by the Commissioner.
(b) Shall include, without limitation, reference to the premium discount tables which apply and the rules for applying the discounts.
(c) Except as otherwise provided in paragraph (d), may continue to use the loss cost multipliers filed until:
(1) The loss cost multipliers are disapproved by the Commissioner; or
(2) The insurer submits a new filing to replace the loss cost multipliers previously filed.
(d) Unless the Commissioner has explicitly approved otherwise, shall use the current loss cost multipliers filed by the Advisory Organization in accordance with the anniversary rating date rule in the manuals of rating rules approved by the Commissioner pursuant to NRS 686B.177.
2. As used in this section, “expense constant” means a premium charged to each policy of industrial insurance regardless of the size of the policy.
(Added to NAC by Comm’r of Insurance by R099-06, eff. 6-28-2006)
NAC 686B.845 Plan for payment of dividends; plan for payment of savings, unearned premium deposits or equivalent abatement for premiums allowed or returned for policy. (NRS 679B.130, 686B.1781)
1. An insurer must file its plan for the payment of dividends for a policy of industrial insurance with the Commissioner at least 30 days before the effective date of the plan.
2. The plan for the payment of dividends filed pursuant to subsection 1 must include:
(a) The dividend plan disclosure forms and dividend payment forms used by the insurer;
(b) The conditions under which the insured will be eligible to receive a dividend;
(c) The criteria used by the insurer for determining which plan is applicable for each particular kind of risk; and
(d) Any applicable formula or factor used by the insurer for calculating dividends, including, without limitation:
(1) Loss ratios;
(2) Tax multipliers;
(3) Loss conversion factors; and
(4) Premiums.
3. A proposal, example, illustration or explanation of dividends presented to or made available to the insured or a potential policyholder must include, without limitation, disclosures including the following information:
(a) The insurer will not declare dividends before the expiration of the policy.
(b) Only the board of directors or other governing body of the insurer, at its sole discretion, may declare and distribute dividends.
(c) Dividends will be paid from the policyholder surplus and not from earned premiums.
(d) Payment of dividends by the insurer is not guaranteed and the actual payment of dividends may differ from the amount of expected dividends.
(e) The insurer will not pay dividends if the Commissioner determines that the payment of dividends would jeopardize the solvency of the insurer or be hazardous to the interests of the general public or the creditors or the policyholders of the insurer.
4. An insurer must file a written description of its plan for the payment of savings, unearned premium deposits or an equivalent abatement for premiums allowed or returned for a policy of industrial insurance with the Commissioner at least 30 days before the effective date of the plan.
5. At the request of the insurer, the Commissioner will keep confidential the information submitted to the Commissioner by the insurer pursuant to paragraph (d) of subsection 2.
(Added to NAC by Comm’r of Insurance by R172-03, eff. 2-12-2004)
