[Rev. 2/11/2015 11:51:03
AM--2014R2]
CHAPTER 686B - RATES AND ESSENTIAL
INSURANCE
RATES AND SERVICE ORGANIZATIONS
General Provisions
NRS 686B.010 Construction
and purposes.
NRS 686B.020 Definitions.
NRS 686B.030 Applicability.
NRS 686B.040 Exemptions.
NRS 686B.050 Standards.
NRS 686B.060 Determination
of whether rates comply with standards.
NRS 686B.070 Filing
of rates and supplementary information with Commissioner.
NRS 686B.080 Rates
and supplementary information open to public inspection; copies; exception.
NRS 686B.090 Use
of rates and supplementary information prepared by rate service organization.
NRS 686B.100 Filing
of supporting data.
NRS 686B.110 Disapproval
of rates.
NRS 686B.115 Hearing
on rates open to public; cost for transcripts; public testimony.
NRS 686B.117 Intervention
in hearing on rates.
NRS 686B.119 Notice
of material change in premiums based upon change in zip code of policyholder.
NRS 686B.125 Limitation
on rates for coverage for dental care; exception.
NRS 686B.130 Limitation
on services relating to rates of insurance; services of rate service
organization and advisory organization to be offered to any insurer.
NRS 686B.140 Licensing
of rate service organization and advisory organization: Application; issuance,
expiration and renewal of license. [Effective until the date of the repeal of
42 U.S.C. § 666, the federal law requiring each state to establish procedures for
withholding, suspending and restricting the professional, occupational and
recreational licenses for child support arrearages and for noncompliance with
certain processes relating to paternity or child support proceedings.]
NRS 686B.140 Licensing
of rate service organization and advisory organization: Application; issuance,
expiration and renewal of license. [Effective on the date of the repeal of 42
U.S.C. § 666, the federal law requiring each state to establish procedures for
withholding, suspending and restricting the professional, occupational and
recreational licenses for child support arrearages and for noncompliance with
certain processes relating to paternity or child support proceedings.]
NRS 686B.143 Payment
of child support: Statement by applicant for license; grounds for denial of
license; duty of Commissioner. [Effective until the date of the repeal of 42
U.S.C. § 666, the federal law requiring each state to establish procedures for
withholding, suspending and restricting the professional, occupational and
recreational licenses for child support arrearages and for noncompliance with
certain processes relating to paternity or child support proceedings.]
NRS 686B.147 Suspension
of license for failure to pay child support or comply with certain subpoenas or
warrants; reinstatement of license. [Effective until the date of the repeal of
42 U.S.C. § 666, the federal law requiring each state to establish procedures
for withholding, suspending and restricting the professional, occupational and
recreational licenses for child support arrearages and for noncompliance with
certain processes relating to paternity or child support proceedings.]
NRS 686B.150 Binding
agreements by insurers.
NRS 686B.160 Recording
and reporting of experience.
NRS 686B.170 Examination
of service organizations.
NRS 686B.175 State
contribution for federally reinsured losses.
Advisory Organization for Industrial Insurance
NRS 686B.1751 Definitions.
NRS 686B.1752 “Advisory
Organization” defined.
NRS 686B.1753 “Basic
premium rate” defined.
NRS 686B.1754 “Classification
of risks” defined.
NRS 686B.1755 “Expenses”
defined.
NRS 686B.1757 “Industrial
insurance” defined.
NRS 686B.1759 “Insurer”
defined.
NRS 686B.176 “Plan
for rating experience” defined.
NRS 686B.17605 “Prospective
loss cost” defined.
NRS 686B.1761 “Rate”
defined.
NRS 686B.1762 “Willful”
defined.
NRS 686B.1763 Applicability
of provisions; Commissioner to administer provisions.
NRS 686B.1764 Designation;
duties.
NRS 686B.17645 Duty
to file with Commissioner formula to assess insurers for certain costs;
approval of formula.
NRS 686B.1765 Powers.
NRS 686B.1767 Prohibited
acts.
NRS 686B.1769 Uniform
Plan for Rating Experience: Requirements; use.
NRS 686B.177 Rating
information to be filed with Commissioner; approval of rates; Commissioner to
report certain changes to Director of Legislative Counsel Bureau; maximum
permissible variance from approved rate.
NRS 686B.1771 Plan
for apportionment among insurers of persons entitled to insurance who have not
been accepted by an insurer.
NRS 686B.1772 Insurers
to adhere to Uniform System of Classifications of Risks and Uniform Plan for
Rating Experience; subclassifications for Uniform System of Classification.
NRS 686B.1773 Insurers
to record and report certain information and adhere to manual of rules and
Uniform Plan for Rating Experience.
NRS 686B.1774 Commissioner
to determine whether interaction among insurers and employers is competitive.
NRS 686B.1775 Filing
of rates and supplementary rate information by insurer with Commissioner;
findings of Commissioner.
NRS 686B.1777 When
Commissioner may require supporting information regarding rates; when hearing
is required for disapproval of rates.
NRS 686B.1779 Grounds
for disapproval of rates.
NRS 686B.178 Commissioner
to issue written order stating reasons for disapproval and date by which
insurer must discontinue use of rate.
NRS 686B.1781 Payment
of dividends: Prohibition against discrimination; submission of plan for
payments related to industrial insurance.
NRS 686B.1782 Agreements
to lessen competition among insurers prohibited; insurers prohibited from
agreeing to rates established in manner that conflicts with provisions.
NRS 686B.1783 Maintenance
of records; examination of records by Commissioner.
NRS 686B.1784 Examination
by Commissioner; cost of examination.
NRS 686B.1785 Request
for reconsideration of rates; appeal.
NRS 686B.1787 Insurer
or advisory organization may request hearing before Commissioner.
NRS 686B.1789 Provisions
governing hearing.
NRS 686B.179 Revocation
or suspension of license.
NRS 686B.1793 Penalties.
NRS 686B.1797 Insurer
prohibited from withholding or giving false or misleading information to
Commissioner or Advisory Organization.
NRS 686B.1799 Limitation
on liability of insurer or rating organization acting within scope of
employment.
ESSENTIAL INSURANCE
General Provisions
NRS 686B.180 Unavailability
of essential coverage; plans for providing coverage.
NRS 686B.185 Immunity
of Commissioner and association.
NRS 686B.200 Voluntary
plan for sharing risks.
Associations
NRS 686B.210 Nevada
Essential Insurance Association: Establishment; membership; plan of operation.
NRS 686B.220 Nevada
Essential Insurance Association: Board of Directors; reimbursement of members
of Board; approval or adoption of plan by Commissioner.
NRS 686B.230 Nevada
Essential Insurance Association: General powers.
NRS 686B.240 Nevada
Essential Insurance Association: Powers of Commissioner and Association.
NRS 686B.250 Nevada
Essential Insurance Association: Immunity from liability.
NRS 686B.260 Conversion
into domestic stock insurer: “Insured” defined.
NRS 686B.270 Conversion
into domestic stock insurer: Applicability of certain provisions governing
nonprofit cooperative corporations.
NRS 686B.280 Conversion
into domestic stock insurer: Filing and contents of notice of intent to
qualify.
NRS 686B.290 Conversion
into domestic stock insurer: Notice to insurers and insureds; hearing.
NRS 686B.300 Conversion
into domestic stock insurer: Determination of percentage of stock for each
insured.
NRS 686B.310 Conversion
into domestic stock insurer: Capitalization.
NRS 686B.320 Conversion
into domestic stock insurer: Issuance of certificate of authority.
NRS 686B.330 Conversion
into domestic mutual insurer or domestic reciprocal insurer: “Insured” defined.
NRS 686B.340 Conversion
into domestic mutual insurer or domestic reciprocal insurer: Exemption from
applicability of NRS 81.130 and 81.510.
NRS 686B.350 Conversion
into domestic mutual insurer or domestic reciprocal insurer: Filing and
contents of notice of intent to qualify.
NRS 686B.360 Conversion
into domestic mutual insurer or domestic reciprocal insurer: Notice to insurers
and insured; hearing.
NRS 686B.370 Conversion
into domestic mutual insurer or domestic reciprocal insurer: Issuance of
certificate of authority.
_________
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RATES AND SERVICE ORGANIZATIONS
General Provisions
NRS 686B.010 Construction and purposes.
1. The Legislature intends that NRS 686B.010 to 686B.1799,
inclusive, be liberally construed to achieve the purposes stated in subsection
2, which constitute an aid and guide to interpretation but not an independent
source of power.
2. The purposes of NRS
686B.010 to 686B.1799, inclusive, are to:
(a) Protect policyholders and the public against
the adverse effects of excessive, inadequate or unfairly discriminatory rates;
(b) Encourage, as the most effective way to
produce rates that conform to the standards of paragraph (a), independent
action by and reasonable price competition among insurers;
(c) Provide formal regulatory controls for use if
independent action and price competition fail;
(d) Authorize cooperative action among insurers
in the rate-making process, and to regulate such cooperation in order to
prevent practices that tend to bring about monopoly or to lessen or destroy
competition;
(e) Encourage the most efficient and economic
marketing practices; and
(f) Regulate the business of insurance in a
manner that will preclude application of federal antitrust laws.
(Added to NRS by 1971, 1698; A 1985, 1067)
NRS 686B.020 Definitions. As
used in NRS 686B.010 to 686B.1799,
inclusive, unless the context otherwise requires:
1. “Advisory organization,” except as
limited by NRS 686B.1752, means any person or
organization which is controlled by or composed of two or more insurers and
which engages in activities related to rate making. For the purposes of this
subsection, two or more insurers with common ownership or operating in this
State under common ownership constitute a single insurer. An advisory
organization does not include:
(a) A joint underwriting association;
(b) An actuarial or legal consultant; or
(c) An employee or manager of an insurer.
2. “Market segment” means any line or kind
of insurance or, if it is described in general terms, any subdivision thereof
or any class of risks or combination of classes.
3. “Rate service organization” means any
person, other than an employee of an insurer, who assists insurers in rate
making or filing by:
(a) Collecting, compiling and furnishing loss or
expense statistics;
(b) Recommending, making or filing rates or
supplementary rate information; or
(c) Advising about rate questions, except as an
attorney giving legal advice.
4. “Supplementary rate information”
includes any manual or plan of rates, statistical plan, classification, rating
schedule, minimum premium, policy fee, rating rule, rule of underwriting
relating to rates and any other information prescribed by regulation of the
Commissioner.
(Added to NRS by 1971, 1698; A 1985, 1067; 1991, 2117; 1995, 2055; 2003, 3351)
NRS 686B.030 Applicability.
1. Except as otherwise provided in
subsection 2 and NRS 686B.125, the provisions of NRS 686B.010 to 686B.1799,
inclusive, apply to all kinds and lines of direct insurance written on risks or
operations in this State by any insurer authorized to do business in this
State, except:
(a) Ocean marine insurance;
(b) Contracts issued by fraternal benefit
societies;
(c) Life insurance and credit life insurance;
(d) Variable and fixed annuities;
(e) Credit accident and health insurance;
(f) Property insurance for business and
commercial risks;
(g) Casualty insurance for business and
commercial risks other than insurance covering the liability of a practitioner
licensed pursuant to chapters 630 to 640, inclusive, of NRS;
(h) Surety insurance;
(i) Health insurance offered through a group
health plan maintained by a large employer; and
(j) Credit involuntary unemployment insurance.
2. The exclusions set forth in paragraphs
(f) and (g) of subsection 1 extend only to issues related to the determination
or approval of premium rates.
(Added to NRS by 1971, 1699; A 1971, 1943; 1985, 1067; 1993, 2397; 1995, 2056; 2003, 3304; 2011, 3368;
2013, 3604)
NRS 686B.040 Exemptions.
1. Except as otherwise provided in
subsection 2, the Commissioner may by rule exempt any person or class of
persons or any market segment from any or all of the provisions of NRS 686B.010 to 686B.1799,
inclusive, if and to the extent that the Commissioner finds their application
unnecessary to achieve the purposes of those sections.
2. The Commissioner may not, by rule or
otherwise, exempt an insurer from the provisions of NRS
686B.010 to 686B.1799, inclusive, with regard
to insurance covering the liability of a practitioner licensed pursuant to chapter 630, 631,
632 or 633
of NRS for a breach of the practitioner’s professional duty toward a patient.
(Added to NRS by 1971, 1699; A 1985, 1068; 2003, 919, 3352)
NRS 686B.050 Standards.
1. Rates must not be excessive, inadequate
or unfairly discriminatory, nor may an insurer charge any rate which if
continued will have or tend to have the effect of destroying competition or
creating a monopoly.
2. The Commissioner may disapprove rates
if there is not a reasonable degree of price competition at the consumer level
with respect to the class of business to which they apply. In determining
whether a reasonable degree of price competition exists, the Commissioner shall
consider all relevant tests, including:
(a) The number of insurers actively engaged in
the class of business and their shares of the market;
(b) The existence of differentials in rates in
that class of business;
(c) Whether long-run profitability for insurers
generally of the class of business is unreasonably high in relation to its
riskiness;
(d) Consumers’ knowledge in regard to the market
in question; and
(e) Whether price competition is a result of the
market or is artificial.
Ê If
competition does not exist, rates are excessive if they are likely to produce a
long-run profit that is unreasonably high in relation to the riskiness of the
class of business, or if expenses are unreasonably high in relation to the
services rendered.
3. Rates are inadequate if they are
clearly insufficient, together with the income from investments attributable to
them, to sustain projected losses and expenses in the class of business to
which they apply.
4. One rate is unfairly discriminatory in
relation to another in the same class if it clearly fails to reflect equitably
the differences in expected losses and expenses. Rates are not unfairly
discriminatory because different premiums result for policyholders with similar
exposure to loss but different expense factors, or similar expense factors but
different exposure to loss, so long as the rates reflect the differences with
reasonable accuracy. Rates are not unfairly discriminatory if they are averaged
broadly among persons insured under a group, franchise or blanket policy.
(Added to NRS by 1971, 1699; A 1987, 1533)
NRS 686B.060 Determination of whether rates comply with standards. In determining whether rates comply with the
standards under NRS 686B.050, the following
criteria shall be applied:
1. Due consideration shall be given to
past and prospective loss and expense experience within and outside of this
state, to catastrophe hazards and contingencies, to trends within and outside
of this state, to loadings for leveling premium rates over time or for
dividends or savings to be allowed or returned by insurers to their
policyholders, members or subscribers, and to all other relevant factors,
including the judgment of technical personnel.
2. Risks may be classified in any
reasonable way for the establishment of rates and minimum premiums, except that
classifications may not be based on race, color, creed or national origin.
Rates thus produced may be modified for individual risks in accordance with
rating plans or schedules which establish reasonable standards for measuring
probable variations in hazards, expenses, or both.
3. The expense provisions included in the
rates to be used by an insurer may reflect the operating methods of the insurer
and, so far as it is credible, its own expense experience.
4. The rates may contain an allowance
permitting a profit that is not unreasonable in relation to the riskiness of
the class of business.
(Added to NRS by 1971, 1700)
NRS 686B.070 Filing of rates and supplementary information with Commissioner.
1. Every authorized insurer and every rate
service organization licensed under NRS 686B.140
which has been designated by any insurer for the filing of rates under
subsection 2 of NRS 686B.090 shall file with the
Commissioner all:
(a) Rates and proposed increases thereto;
(b) Forms of policies to which the rates apply;
(c) Supplementary rate information; and
(d) Changes and amendments thereof,
Ê made by it
for use in this state.
2. A filing made pursuant to this section
must include a proposed effective date and must be filed not less than 30 days
before that proposed effective date, except that a filing for a proposed
increase or decrease in a rate may include a request that the Commissioner
authorize an effective date that is earlier than the proposed effective date.
3. If an insurer makes a filing for a proposed
increase in a rate for insurance covering the liability of a practitioner
licensed pursuant to chapter 630, 631, 632 or 633 of NRS for a breach of the practitioner’s
professional duty toward a patient, the insurer shall not include in the filing
any component that is directly or indirectly related to the following:
(a) Capital losses, diminished cash flow from any
dividends, interest or other investment returns, or any other financial loss
that is materially outside of the claims experience of the professional liability
insurance industry, as determined by the Commissioner.
(b) Losses that are the result of any criminal or
fraudulent activities of a director, officer or employee of the insurer.
Ê If the
Commissioner determines that a filing includes any such component, the
Commissioner shall, pursuant to NRS 686B.110,
disapprove the proposed increase, in whole or in part, to the extent that the
proposed increase relies upon such a component.
4. If an insurer makes a filing for a
proposed increase in a rate for a health benefit plan, as that term is defined
in NRS 687B.470, the filing must
include a unified rate review template, a written description justifying the
rate increase and any rate filing documentation.
5. As used in this section, “rate filing
documentation,” “unified rate review template” and “written description
justifying the rate increase” have the meanings ascribed in 45 C.F.R. §
154.215.
(Added to NRS by 1971, 1700; A 1981, 698; 1987, 1533; 1989, 2176; 2003, 919, 3352; 2013, 257, 3605)
NRS 686B.080 Rates and supplementary information open to public inspection;
copies; exception.
1. Except as otherwise provided in
subsections 2 and 3, each filing and any supporting information filed under NRS 686B.010 to 686B.1799,
inclusive, must, as soon as filed, be open to public inspection at any
reasonable time. Copies may be obtained by any person on request and upon
payment of a reasonable charge therefor.
2. All approved rates for health benefit
plans available for purchase by individuals are considered proprietary and to
constitute trade secrets, and are not subject to disclosure by the Commissioner
to persons outside the Division except as agreed to by the carrier or as
ordered by a court of competent jurisdiction.
3. The provisions of subsection 2 expire
annually on the date 30 days before open enrollment.
4. For the purposes of this section, “open
enrollment” has the meaning ascribed to it in 45 C.F.R. § 147.104(b)(1)(ii).
(Added to NRS by 1971, 1700; A 1985, 1068; 2013, 3605)
NRS 686B.090 Use of rates and supplementary information prepared by rate
service organization.
1. An insurer shall establish rates and
supplementary rate information for any market segment based on the factors in NRS 686B.060. If an insurer has insufficient
creditable loss experience, it may use rates and supplementary rate information
prepared by a rate service organization, with modification for its own expense
and loss experience.
2. An insurer may discharge its obligation
under subsection 1 of NRS 686B.070 by giving
notice to the Commissioner that it uses rates and supplementary rate
information prepared by a designated rate service organization, with such
information about modifications thereof as are necessary fully to inform the
Commissioner. The insurer’s rates and supplementary rate information shall be
deemed those filed from time to time by the rate service organization,
including any amendments thereto as filed, subject to the modifications filed
by the insurer.
(Added to NRS by 1971, 1701; A 1987, 1534; 2003, 920, 3353)
NRS 686B.100 Filing of supporting data.
1. By rule, the Commissioner may require
the filing of supporting data as to any or all kinds or lines of insurance or
subdivisions thereof or classes of risks or combinations thereof as the
Commissioner deems necessary for the proper functioning of the process for
monitoring and regulating rates. The supporting data must include:
(a) The experience and judgment of the filer,
and, to the extent it wishes or the Commissioner requires, of other insurers or
rate service organizations;
(b) Its interpretation of any statistical data
relied upon;
(c) Descriptions of the actuarial and statistical
methods employed in setting the rates; and
(d) Any other relevant matters required by the
Commissioner.
2. Whenever a filing of a proposed
increase in a rate is not accompanied by such information as the Commissioner
has required under subsection 1, the Commissioner may so inform the insurer and
the filing shall be deemed to be made when the information is furnished.
(Added to NRS by 1971, 1701; A 1985, 1068; 1987, 1534; 1989, 601, 2176)
NRS 686B.110 Disapproval of rates.
1. The Commissioner shall consider each
proposed increase or decrease in the rate of any kind or line of insurance or
subdivision thereof filed with the Commissioner pursuant to subsection 1 of NRS 686B.070. If the Commissioner finds that a
proposed increase will result in a rate which is not in compliance with NRS 686B.050 or subsection 3 of NRS 686B.070, the Commissioner shall disapprove the
proposal. The Commissioner shall approve or disapprove each proposal no later
than 30 days after it is determined by the Commissioner to be complete pursuant
to subsection 6. If the Commissioner fails to approve or disapprove the
proposal within that period, the proposal shall be deemed approved.
2. If the Commissioner disapproves a
proposed increase or decrease in any rate pursuant to subsection 1, the
Commissioner shall send a written notice of disapproval to the insurer or the
rate service organization that filed the proposal. The notice must set forth
the reasons the proposal is not in compliance with NRS
686B.050 or subsection 3 of NRS 686B.070 and
must be sent to the insurer or the rate service organization not more than 30
days after the Commissioner determines that the proposal is complete pursuant
to subsection 6.
3. Upon receipt of a written notice of
disapproval from the Commissioner pursuant to subsection 2 or 6, the insurer or
rate service organization may request that the Commissioner reconsider the
proposed increase or decrease. The request for reconsideration must be received
by the Commissioner not more than 30 days after the insurer or rate service
organization receives the written notice of disapproval from the Commissioner,
except that if the insurer or rate service organization requests, in writing,
an extension of 30 additional days in which to request a reconsideration, the
Commissioner shall grant the extension. A request for reconsideration submitted
pursuant to this subsection may include, without limitation, any documents or
other information for review by the Commissioner in reconsidering the proposal.
The Commissioner shall approve or disapprove the proposal upon reconsideration
not later than 30 days after receipt of the request for reconsideration and
shall notify the insurer or rate service organization of his or her approval or
disapproval.
4. Whenever an insurer has no legally
effective rates as a result of the Commissioner’s disapproval of rates or other
act, the Commissioner shall on request specify interim rates for the insurer
that are high enough to protect the interests of all parties and may order that
a specified portion of the premiums be placed in an escrow account approved by
the Commissioner. When new rates become legally effective, the Commissioner
shall order the escrowed funds or any overcharge in the interim rates to be
distributed appropriately, except that refunds to policyholders that are de
minimis must not be required.
5. If the Commissioner disapproves a
proposed rate pursuant to subsection 1, subsection 6 or upon reconsideration
pursuant to subsection 3 and an insurer requests a hearing to determine the
validity of the action of the Commissioner, the insurer has the burden of
showing compliance with the applicable standards for rates established in NRS 686B.010 to 686B.1799,
inclusive. Any such hearing must be held:
(a) Within 30 days after the request for a
hearing has been submitted to the Commissioner; or
(b) Within a period agreed upon by the insurer
and the Commissioner.
Ê If the
hearing is not held within the period specified in paragraph (a) or (b), or if
the Commissioner fails to issue an order concerning the proposed rate for which
the hearing is held within 45 days after the hearing, the proposed rate shall
be deemed approved.
6. The Commissioner shall by regulation
specify the documents or any other information which must be included in a
proposal to increase or decrease a rate submitted to the Commissioner pursuant
to subsection 1. Each such proposal shall be deemed complete upon its filing
with the Commissioner, unless the Commissioner, within 15 business days after
the proposal is filed with the Commissioner, determines that the proposal is
incomplete because the proposal does not comply with the regulations adopted by
the Commissioner pursuant to this subsection. The Commissioner shall notify the
insurer or rate service organization if the Commissioner determines that the
proposal is incomplete. The notice must be sent within 15 business days after
the proposal is filed with the Commissioner and must set forth the documents or
other information that is required to complete the proposal. The Commissioner
may disapprove the proposal if the insurer or rate service organization fails
to provide the documents or other information to the Commissioner within 30
days after the insurer or rate service organization receives the notice that
the proposal is incomplete. If the Commissioner disapproves the proposal
pursuant to this subsection, the Commissioner shall notify the insurer or rate
service organization of that fact in writing.
(Added to NRS by 1971, 1702; A 1987, 1535; 1989, 2177; 1991, 1630; 1995, 1415, 1746; 1997, 548; 2003, 920, 3353; 2013, 257)
NRS 686B.115 Hearing on rates open to public; cost for transcripts; public
testimony.
1. Any hearing held by the Commissioner to
determine whether rates comply with the provisions of NRS
686B.010 to 686B.1799, inclusive, must be
open to members of the public.
2. All costs for transcripts prepared
pursuant to such a hearing must be paid by the insurer requesting the hearing.
3. At any hearing which is held by the
Commissioner to determine whether rates comply with the provisions of NRS 686B.010 to 686B.1799,
inclusive, and which involves rates for insurance covering the liability of a
practitioner licensed pursuant to chapter 630,
631, 632 or
633 of NRS for a breach of the practitioner’s
professional duty toward a patient, if a person is not otherwise authorized
pursuant to this title to become a party to the hearing by intervention, the
person is entitled to provide testimony at the hearing if, not later than 2
days before the date set for the hearing, the person files with the
Commissioner a written statement which states:
(a) The name and title of the person;
(b) The interest of the person in the hearing;
and
(c) A brief summary describing the purpose of the
testimony the person will offer at the hearing.
4. If a person provides testimony at a
hearing in accordance with subsection 3:
(a) The Commissioner may, if the Commissioner
finds it necessary to preserve order, prevent inordinate delay or protect the
rights of the parties at the hearing, place reasonable limitations on the
duration of the testimony and prohibit the person from providing testimony that
is not relevant to the issues raised at the hearing.
(b) The Commissioner shall consider all relevant
testimony provided by the person at the hearing in determining whether the
rates comply with the provisions of NRS 686B.010
to 686B.1799, inclusive.
(Added to NRS by 1987, 1532; A 1995, 1623; 2003, 921)
NRS 686B.117 Intervention in hearing on rates. If
a filing made with the Commissioner pursuant to paragraph (a) of subsection 1
of NRS 686B.070 pertains to insurance covering the
liability of a practitioner licensed pursuant to chapter
630, 631, 632
or 633 of NRS for a breach of the
practitioner’s professional duty toward a patient, any interested person, and
any association of persons or organization whose members may be affected, may
intervene as a matter of right in any hearing or other proceeding conducted to
determine whether the applicable rate or proposed increase thereto:
1. Complies with the standards set forth
in NRS 686B.050 and subsection 3 of NRS 686B.070.
2. Should be approved or disapproved.
(Added to NRS by 2003, 3351; A 2013, 259)
NRS 686B.119 Notice of material change in premiums based upon change in zip
code of policyholder. Each insurer
shall notify its policyholders, in a manner which the Commissioner shall
prescribe by regulation, if the policyholders’ premiums for insurance will be
materially increased or decreased because the zip code assigned to the address
of the policyholder is changed by the United States Postal Service.
(Added to NRS by 1991, 2117)
NRS 686B.125 Limitation on rates for coverage for dental care; exception.
1. Except as otherwise provided in this
section, no insurer, organization or person licensed pursuant to this title may
sell or offer to sell any contract providing coverage for dental care at a rate
which is excessive for the benefits offered to the insured or member. For the
purpose of this section, a ratio of losses to premiums collected which is less
than 75 percent is presumed to show an excessive rate.
2. The provisions of subsection 1 do not
apply to a contract providing coverage for dental care that is sold to a small
employer pursuant to the provisions of chapter
689C of NRS.
3. As used in this section, “small employer”
has the meaning ascribed to it in NRS
689C.095.
(Added to NRS by 1983, 2028; A 2013, 3606)
NRS 686B.130 Limitation on services relating to rates of insurance; services
of rate service organization and advisory organization to be offered to any
insurer.
1. A rate service organization and an
advisory organization shall not provide any service relating to the rates of
any insurance subject to NRS 686B.010 to 686B.1799, inclusive, and an insurer shall not
utilize the services of an organization for such purposes unless the
organization has obtained a license pursuant to NRS
686B.140.
2. A rate service organization and an
advisory organization shall not refuse to supply any services for which it is
licensed in this state to any insurer authorized to do business in this state
and offering to pay the fair and usual compensation for the services.
(Added to NRS by 1971, 1702; A 1985, 1069; 1995, 2056)
NRS 686B.140 Licensing of rate service organization and advisory
organization: Application; issuance, expiration and renewal of license.
[Effective until the date of the repeal of 42 U.S.C. § 666, the federal law
requiring each state to establish procedures for withholding, suspending and
restricting the professional, occupational and recreational licenses for child
support arrearages and for noncompliance with certain processes relating to
paternity or child support proceedings.]
1. A rate service organization or an
advisory organization applying for a license as required by NRS 686B.130 must include with its application:
(a) A copy of its constitution, charter, articles
of organization, agreement, association or incorporation, and a copy of its
bylaws, plan of operation and any other rules or regulations governing the
conduct of its business;
(b) A list of its membership and subscribers;
(c) The name and address of one or more residents
of this State upon whom notices, process affecting it or orders of the
Commissioner may be served;
(d) A statement showing its technical
qualifications for acting in the capacity for which it seeks a license;
(e) If the applicant is a natural person who wishes
to obtain a license as a rate service organization, the statement required
pursuant to NRS 686B.143;
(f) Any other relevant information and documents
that the Commissioner may require; and
(g) All applicable fees.
2. If the applicant is a natural person,
the application must include the social security number of the applicant.
3. Every organization which has applied
for a license pursuant to subsection 1 shall thereafter promptly notify the
Commissioner of every material change in the facts or in the documents on which
its application was based.
4. If the Commissioner finds that the
applicant and the natural persons through whom it acts are competent,
trustworthy and technically qualified to provide the services proposed, and
that all requirements of law are met, the Commissioner shall issue a license
specifying the authorized activity of the applicant. The Commissioner shall not
issue a license if the proposed activity would tend to create a monopoly or to
lessen or destroy competition in prices.
5. A license issued pursuant to this
section continues in effect until the licensee leaves the State or until the
license is suspended, revoked or otherwise terminated. A license may be renewed
upon:
(a) If the licensee is a natural person who has
been issued a license as a rate service organization, submission of the
statement required pursuant to NRS 686B.143 and
payment of all applicable fees for renewal to the Commissioner on or before the
last day on which the license is renewable; or
(b) If the licensee is an advisory organization
or a rate service organization that is not a natural person, payment of all
applicable fees for renewal to the Commissioner on or before the last day on
which the license is renewable.
6. A license which is not renewed annually
expires on March 1. The Commissioner may accept a request for renewal received
by the Commissioner within 30 days after the expiration of the license if the
request is accompanied by:
(a) If the licensee is a natural person who has
been issued a license as a rate service organization, the statement required
pursuant to NRS 686B.143 and a fee for renewal of
150 percent of all applicable fees otherwise required, except for any fee
required pursuant to NRS 680C.110; or
(b) If the licensee is a rate service
organization that is not a natural person or is an advisory organization, a fee
for renewal of 150 percent of all applicable fees otherwise required, except
for any fee required pursuant to NRS
680C.110.
7. Any amendment to a document filed
pursuant to paragraph (a) of subsection 1 must be filed at least 30 days before
it becomes effective. Failure to comply with this subsection is a ground for
revocation of the license granted pursuant to subsection 4.
(Added to NRS by 1971, 1702; A 1987, 463; 1995, 2056; 1997, 2197, 2210; 2009, 1784)
NRS 686B.140 Licensing of rate service
organization and advisory organization: Application; issuance, expiration and
renewal of license. [Effective on the date of the repeal of 42 U.S.C. § 666,
the federal law requiring each state to establish procedures for withholding,
suspending and restricting the professional, occupational and recreational
licenses for child support arrearages and for noncompliance with certain
processes relating to paternity or child support proceedings.]
1. A rate service organization or an
advisory organization applying for a license as required by NRS 686B.130 must include with its application:
(a) A copy of its constitution, charter, articles
of organization, agreement, association or incorporation, and a copy of its
bylaws, plan of operation and any other rules or regulations governing the
conduct of its business;
(b) A list of its membership and subscribers;
(c) The name and address of one or more residents
of this state upon whom notices, process affecting it or orders of the
Commissioner may be served;
(d) A statement showing its technical
qualifications for acting in the capacity for which it seeks a license;
(e) Any other relevant information and documents
that the Commissioner may require; and
(f) All applicable fees.
2. Every organization which has applied
for a license pursuant to subsection 1 shall thereafter promptly notify the
Commissioner of every material change in the facts or in the documents on which
its application was based.
3. If the Commissioner finds that the
applicant and the natural persons through whom it acts are competent,
trustworthy and technically qualified to provide the services proposed, and
that all requirements of law are met, the Commissioner shall issue a license
specifying the authorized activity of the applicant. The Commissioner shall not
issue a license if the proposed activity would tend to create a monopoly or to
lessen or destroy competition in prices.
4. A license issued pursuant to this
section continues in effect until the licensee leaves the state or until the
license is suspended, revoked or otherwise terminated. A license may be renewed
by payment of all applicable fees for renewal to the Commissioner on or before
the last day on which it is renewable.
5. A license which is not renewed annually
expires on March 1. The Commissioner may accept a request for renewal received
by the Commissioner within 30 days after the expiration of the license if the
request is accompanied by a fee for renewal of 150 percent of all applicable
fees otherwise required, except for any fee required pursuant to NRS 680C.110.
6. Any amendment to a document filed
pursuant to paragraph (a) of subsection 1 must be filed at least 30 days before
it becomes effective. Failure to comply with this subsection is a ground for
revocation of the license granted pursuant to subsection 3.
(Added to NRS by 1971, 1702; A 1987, 463; 1995, 2056; 1997, 2197, 2210; 2009, 1784,
effective on the date of the repeal of 42 U.S.C. § 666, the federal law
requiring each state to establish procedures for withholding, suspending and
restricting the professional, occupational and recreational licenses for child
support arrearages and for noncompliance with certain processes relating to
paternity or child support proceedings)
NRS 686B.143 Payment of child support: Statement by applicant for license;
grounds for denial of license; duty of Commissioner. [Effective until the date
of the repeal of 42 U.S.C. § 666, the federal law requiring each state to
establish procedures for withholding, suspending and restricting the
professional, occupational and recreational licenses for child support
arrearages and for noncompliance with certain processes relating to paternity
or child support proceedings.]
1. A natural person who applies for the issuance
or renewal of a license as a rate service organization shall submit to the
Commissioner the statement prescribed by the Division of Welfare and Supportive
Services of the Department of Health and Human Services pursuant to NRS 425.520. The statement must be
completed and signed by the applicant.
2. The Commissioner shall include the
statement required pursuant to subsection 1 in:
(a) The application or any other forms that must
be submitted for the issuance or renewal of the license; or
(b) A separate form prescribed by the
Commissioner.
3. A license as a rate service
organization may not be issued or renewed by the Commissioner if the applicant
is a natural person who:
(a) Fails to submit the statement required
pursuant to subsection 1; or
(b) Indicates on the statement submitted pursuant
to subsection 1 that the applicant is subject to a court order for the support
of a child and is not in compliance with the order or a plan approved by the
district attorney or other public agency enforcing the order for the repayment
of the amount owed pursuant to the order.
4. If an applicant indicates on the
statement submitted pursuant to subsection 1 that the applicant is subject to a
court order for the support of a child and is not in compliance with the order
or a plan approved by the district attorney or other public agency enforcing
the order for the repayment of the amount owed pursuant to the order, the
Commissioner shall advise the applicant to contact the district attorney or
other public agency enforcing the order to determine the actions that the
applicant may take to satisfy the arrearage.
(Added to NRS by 1997, 2196)
NRS 686B.147 Suspension of license for failure to pay child support or comply
with certain subpoenas or warrants; reinstatement of license. [Effective until
the date of the repeal of 42 U.S.C. § 666, the federal law requiring each state
to establish procedures for withholding, suspending and restricting the
professional, occupational and recreational licenses for child support
arrearages and for noncompliance with certain processes relating to paternity
or child support proceedings.]
1. If the Commissioner receives a copy of
a court order issued pursuant to NRS
425.540 that provides for the suspension of all professional, occupational
and recreational licenses, certificates and permits issued to a person who is
the holder of a license as a rate service organization, the Commissioner shall
deem the license issued to that person to be suspended at the end of the 30th
day after the date on which the court order was issued unless the Commissioner
receives a letter issued to the holder of the license by the district attorney
or other public agency pursuant to NRS
425.550 stating that the holder of the license has complied with the subpoena
or warrant or has satisfied the arrearage pursuant to NRS 425.560.
2. The Commissioner shall reinstate a
license as a rate service organization that has been suspended by a district
court pursuant to NRS 425.540 if the
Commissioner receives a letter issued by the district attorney or other public
agency pursuant to NRS 425.550 to the
person whose license was suspended stating that the person whose license was
suspended has complied with the subpoena or warrant or has satisfied the
arrearage pursuant to NRS 425.560.
(Added to NRS by 1997, 2196)
NRS 686B.150 Binding agreements by insurers. No
insurer shall assume any obligation to any person other than a policyholder or
other companies under common control to use or adhere to certain rates or rules,
and no other person shall impose any penalty or other adverse consequence for
failure of an insurer to adhere to certain rates or rules.
(Added to NRS by 1971, 1703)
NRS 686B.160 Recording and reporting of experience.
1. The Commissioner may promulgate or
approve reasonable rules providing statistical plans for use thereafter by all
insurers in the recording and reporting of loss and expense experience, in
order that the experience of insurers may be made available to the
Commissioner.
2. The Commissioner may designate one or
more rate service organizations to assist the Commissioner in gathering such
experience and making compilations thereof, which must be made available to the
public.
(Added to NRS by 1971, 1703; A 1987, 1535)
NRS 686B.170 Examination of service organizations.
1. Whenever the Commissioner deems it
necessary in order to inform himself or herself about any matter related to the
enforcement of the insurance laws, the Commissioner may examine the affairs and
condition of any rate service organization under subsection 1 of NRS 686B.130. So far as reasonably necessary for an
examination pursuant to this subsection, the Commissioner may examine the accounts,
records, documents or evidences of transactions, so far as they relate to the
examinee, of any officer, manager, general agent, employee, person who has
executive authority over or is in charge of any segment of the examinee’s
affairs, person controlling or having a contract under which the person has the
right to control the examinee whether exclusively or with others, person who is
under the control of the examinee, or any person who is under the control of a
person who controls or has a right to control the examinee whether exclusively
or with others. On demand every examinee under this subsection shall make
available to the Commissioner for examination any of its own accounts, records,
documents or evidences of transactions and any of those of the persons listed
in this subsection.
2. The Commissioner shall examine every
licensed rate service organization at intervals to be established by rule.
3. In lieu of all or part of an
examination conducted pursuant to subsections 1 and 2, or in addition to it,
the Commissioner may order an independent audit by certified public accountants
or actuarial evaluation by actuaries approved by the Commissioner of any person
subject to the examination requirement. Any accountant or actuary selected is
subject to rules respecting conflicts of interest promulgated by the
Commissioner. Any audit or evaluation conducted pursuant to this subsection is
subject to subsections 6 to 15, inclusive, so far as appropriate.
4. In lieu of all or part of an
examination conducted pursuant to this section, the Commissioner may accept the
report of an audit already made by certified public accountants or actuarial
evaluation by actuaries approved by the Commissioner, or the report of an
examination made by the insurance department of another state.
5. An examination may cover
comprehensively all aspects of the examinee’s affairs and condition. The
Commissioner shall determine the exact nature and scope of each examination,
and in doing so shall take into account all relevant factors, including but not
limited to the length of time the examinee has been operating, the length of
time the examinee has been licensed in this state, the nature of the services
provided, the nature of the accounting records available and the nature of
examinations performed elsewhere.
6. For each examination conducted pursuant
to this section, the Commissioner shall issue an order stating the scope of the
examination and designating the examiner in charge. Upon demand a copy of the
order must be exhibited to the examinee.
7. Any examiner authorized by the
Commissioner shall, so far as necessary to the purposes of the examination,
have access at all reasonable hours to the premises and to any books, records,
files, securities, documents or property of the examinee and to those of persons
listed in subsection 1 so far as they relate to the affairs of the examinee.
8. The officer, employees and agents of
the examinee and of persons listed in subsection 1 shall comply with every
reasonable request of the examiners for assistance in any matter relating to
the examination. A person shall not obstruct or interfere with the examination
in any way other than by legal process.
9. If the Commissioner finds the accounts
or records to be inadequate for proper examination of the condition and affairs
of the examinee or improperly kept or posted, the Commissioner may employ experts
to rewrite, post or balance them at the expense of the examinee.
10. The examiner in charge of an
examination shall make a proposed report of the examination which must include
such information and analysis as is ordered in subsection 6, together with the
examiner’s recommendations. Preparation of the proposed report may include
conferences with the examinee or the representatives of the examinee at the
option of the examiner in charge. The proposed report is confidential until
filed in accordance with subsection 11.
11. The Commissioner shall serve a copy of
the proposed report upon the examinee. Within 20 days after service, the
examinee may serve upon the Commissioner a written demand for a hearing on the
contents of the report. If a hearing is demanded, the Commissioner shall give
notice and hold a hearing pursuant to NRS
679B.310 to 679B.370, inclusive,
except that on demand by the examinee the hearing must be private. Within 60
days after the hearing or if no hearing is demanded then within 60 days after
the last day on which the examinee might have demanded a hearing, the
Commissioner shall adopt the report with any necessary modifications and file
it for public inspection, or the Commissioner shall order a new examination.
12. The Commissioner shall forward a copy
of the examination report to the examinee immediately upon adoption, except
that if the proposed report is adopted without change, the Commissioner need
only so notify the examinee.
13. The examinee shall forthwith furnish
copies of the adopted report to each member of its board of directors or other
governing board.
14. The Commissioner may furnish, without
cost or at a price to be determined by the Commissioner, a copy of the adopted
report to the insurance commissioner of each state in the United States and of
each foreign jurisdiction in which the examinee is licensed and to any other
interested person in this state or elsewhere.
15. In any proceeding by or against the
examinee or any officer or agent thereof the examination report as adopted by
the Commissioner is admissible as evidence of the facts stated therein. In any
proceeding by or against the examinee, the facts asserted in any report
properly admitted in evidence are presumed to be true in the absence of
contrary evidence.
16. The reasonable costs of an examination
conducted pursuant to this section must be paid by the examinee except as
otherwise provided in subsection 19. These costs include the salary and
expenses of each examiner and any other expenses which are directly apportioned
to the examination.
17. The amount payable pursuant to
subsection 16 is due 10 days after the examinee has been served a detailed
account of the costs.
18. The Commissioner may require any
examinee, before or from time to time during an examination to deposit with the
State Treasurer such deposits as the Commissioner deems necessary to pay the
costs of the examination. Any deposit and any payment made pursuant to
subsections 16 and 17 must be deposited in the Insurance Examination Account.
19. On the examinee’s request or on the
motion of the Commissioner, the Commissioner may pay all or part of the costs
of an examination whenever the Commissioner finds that, because of the
frequency of examinations or other factors, imposition of the costs would place
an unreasonable burden on the examinee. The Commissioner shall include in his
or her annual report information about any instance in which the Commissioner
applied this subsection.
20. Deposits and payments made pursuant to
subsections 16 to 19, inclusive, shall not be deemed to be a tax or license fee
within the meaning of any statute. If any other state charges a per diem fee
for examination of examinees domiciled in this state, any examinee domiciled in
that other state shall pay the same fee when examined by the Commissioner of
Insurance of this state.
(Added to NRS by 1971, 1704; A 1977, 811; 1991, 1820)
NRS 686B.175 State contribution for federally reinsured losses.
1. The Commissioner is authorized to
assess each insurance company authorized to do business in this state an
aggregate amount sufficient to provide a fund to reimburse the Secretary of
Housing and Urban Development in the manner set forth in section 1223(a)(1) of
the National Housing Act as amended by section 1103 of the Urban Property
Protection and Reinsurance Act of 1968, P.L. 90-448, 82 Stat. 476. The
assessment shall be on those lines reinsured during the current year in this
state by the Secretary of Housing and Urban Development pursuant to such act.
The assessment shall be in the proportion that the premiums earned during the
preceding calendar year by each such company in this state bear to the
aggregate premiums earned on those lines in this state by all insurers. The
fund may be provided in whole or in part from appropriations by the
Legislature.
2. Rates used by an insurer shall not be
deemed excessive because they contain an amount reasonably calculated to recoup
assessments made under this section.
(Added to NRS by 1971, 1707)
Advisory Organization for Industrial Insurance
NRS 686B.1751 Definitions. As
used in NRS 686B.1751 to 686B.1799,
inclusive, unless the context otherwise requires, the words and terms defined
in NRS 686B.1752 to 686B.1762,
inclusive, have the meanings ascribed to them in those sections.
(Added to NRS by 1995, 2049; A 1999, 2220, 3381; 2001, 2256)
NRS 686B.1752 “Advisory Organization” defined. “Advisory
Organization,” when preceded by the definite article, means the organization
designated by the Commissioner pursuant to NRS
686B.1764.
(Added to NRS by 1995, 2049)
NRS 686B.1753 “Basic premium rate” defined. “Basic
premium rate” means the portion of a rate attributable to the cost of losses
per unit of exposure and includes the expense of adjusting those losses.
(Added to NRS by 1995, 2049)
NRS 686B.1754 “Classification of risks” defined. “Classification
of risks” or “classification” means the system or arrangement used to recognize
differences of exposure to hazards among employers with different occupations,
industries or operations.
(Added to NRS by 1995, 2049)
NRS 686B.1755 “Expenses” defined. “Expenses”
means the portion of a rate attributable to the costs for the acquisition of
employers to insure, supervision of employees and agents, collection of
accounts, general expenses, taxes, licenses and fees.
(Added to NRS by 1995, 2049)
NRS 686B.1757 “Industrial insurance” defined. “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 NRS by 1995, 2049)
NRS 686B.1759 “Insurer” defined. “Insurer”
means any private carrier authorized to provide industrial insurance in this
state.
(Added to NRS by 1995, 2049; A 1997, 1450; 1999, 444, 1833)
NRS 686B.176 “Plan for rating experience” defined. “Plan
for rating experience” means a procedure used to predict the future losses of
an individual policyholder by measuring the past losses of the individual
policyholder against the losses of other policyholders in the same
classification to determine any prospective credit, debit or unitary
modifications of premiums for the individual policyholder.
(Added to NRS by 1995, 2049)
NRS 686B.17605 “Prospective loss cost” defined. “Prospective
loss cost” 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 NRS by 1999, 2219)
NRS 686B.1761 “Rate” defined. “Rate”
means the cost of insurance based on a unit of exposure to liability before any
adjustments are made for an individual employer’s losses, or expenses, or a
combination of both. The term does not include minimum premiums charged by an
insurer.
(Added to NRS by 1995, 2049)
NRS 686B.1762 “Willful” defined. “Willful”
or “willfully” in relation to an act or omission which constitutes a violation
of this chapter means with actual knowledge or belief that the act or omission
constitutes a violation and with specific intent to commit the violation.
(Added to NRS by 1995, 2049)
NRS 686B.1763 Applicability of provisions; Commissioner to administer
provisions.
1. NRS 686B.1751
to 686B.1799, inclusive, apply to insurers
providing industrial insurance and to the Advisory Organization designated by
the Commissioner. The Commissioner shall administer the provisions of these
sections.
2. These provisions apply to all
industrial insurance issued in this state except reinsurance.
(Added to NRS by 1995, 2049)
NRS 686B.1764 Designation; duties. The
Commissioner shall designate one licensed advisory organization to act as the
Commissioner’s statistical agent and to assist the Commissioner in compiling
relevant statistical information. The designation must be made pursuant to
reasonable competitive bidding procedures established by the Commissioner. The
Advisory Organization shall:
1. Provide reliable statistics for
industrial insurance.
2. Collect and tabulate information and
statistics in a Uniform Statistical Plan, to be approved and used by the
Commissioner.
3. Formulate a manual of rules reasonably
related to the recording and reporting of data according to the Uniform
Statistical Plan, Uniform Plan for Rating Experience and the Uniform System of
Classification, and present the proposed manual to the Commissioner for
approval.
(Added to NRS by 1995, 2050)
NRS 686B.17645 Duty to file with Commissioner formula to assess insurers for
certain costs; approval of formula.
1. The Advisory Organization shall, at
least 60 days before imposing an assessment pursuant to this section, file with
the Commissioner a formula for an assessment on all insurers, which results in
an equitable distribution among all insurers, of:
(a) The costs of paying the expenses of the
members of the appeals panel for industrial insurance pursuant to the
provisions of NRS 616B.770; and
(b) Any costs incurred by the Advisory
Organization to administer the appeals panel for industrial insurance pursuant
to the provisions of NRS 616B.760 to 616B.790, inclusive.
2. The formula for the assessment filed
pursuant to subsection 1 shall be deemed approved unless it is disapproved by
the Commissioner within 60 days after it is filed.
(Added to NRS by 1999, 3381; A 2001, 2256)
NRS 686B.1765 Powers. The
Advisory Organization may:
1. Develop statistical plans including
definitions for the classification of risks.
2. Collect statistical data from its
members and subscribers or any other reliable source.
3. Prepare and distribute data on
prospective loss costs.
4. Prepare and distribute manuals of rules
and schedules for rating which do not permit calculating the final rates
without using information other than the information in the manual.
5. Distribute any information filed with
the Commissioner which is open to public inspection.
6. Conduct research and collect statistics
to discover, identify and classify information on the causes and prevention of
losses.
7. Prepare and file forms and endorsements
for policies and consult with its members, subscribers and any other
knowledgeable persons on their use.
8. Collect, compile and distribute
information on the past and current premiums charged by individual insurers if
the information is available for public inspection.
9. Conduct research and collect
information to determine what effect changes in benefits to injured employees
pursuant to chapters 616A to 617, inclusive, of NRS will have on prospective
loss costs.
10. Prepare and distribute rules and
rating values for the Uniform Plan for Rating Experience.
11. Calculate and provide to the insurer
the modification of premiums based on the individual employer’s losses.
12. Assist an individual insurer to
develop rates, supplementary rate information or other supporting information
if authorized to do so by the insurer.
(Added to NRS by 1995, 2050; A 1997, 1450, 1451; 1999, 444, 2220, 2224; 2001, 154)
NRS 686B.1767 Prohibited acts. An
advisory organization shall not:
1. Compile or distribute recommendations
concerning rates which include expenses, other than expenses to adjust losses
or profit; or
2. File rates, supplementary rate
information or supporting information on behalf of an insurer.
(Added to NRS by 1995, 2050; A 1997, 1451, 1452; 1999, 444, 2224)
NRS 686B.1769 Uniform Plan for Rating Experience: Requirements; use.
1. The Uniform Plan for Rating Experience
must:
(a) Contain reasonable standards for eligibility
in the Plan;
(b) Provide adequate incentives for employers to
prevent losses; and
(c) Permit sufficient differences in an insurer’s
premiums to encourage safety at the employer’s place of business.
2. The Plan must be the exclusive basis
for adjusting future premiums by evaluating an individual employer’s
characteristics which tend to produce losses, but an insurer may file a rating
plan that provides for an adjustment of premiums retrospectively based on an
individual employer’s past experience of losses.
(Added to NRS by 1995, 2051)
NRS 686B.177 Rating information to be filed with Commissioner; approval of
rates; Commissioner to report certain changes to Director of Legislative
Counsel Bureau; maximum permissible variance from approved rate.
1. The Advisory Organization shall file
with the Commissioner a copy of every prospective loss cost, every manual of
rating rules, every rating schedule and every change, amendment or modification
to them which is proposed for use in this state at least 60 days before they
are distributed to the organization’s members, subscribers or other persons.
The rates shall be deemed to be approved unless they are disapproved by the
Commissioner within 60 days after they are filed.
2. The Commissioner shall report any changes
in rates or in the Uniform Plan for Rating Experience, the Uniform Statistical
Plan or the Uniform System of Classification, when approved, to the Director of
the Legislative Counsel Bureau.
(Added to NRS by 1995, 2051; A 1997, 1452; 1999, 444, 2221, 2224; 2001, 154)
NRS 686B.1771 Plan for apportionment among insurers of persons entitled to
insurance who have not been accepted by an insurer.
1. No insurer is required to issue to any
particular employer a policy for industrial insurance.
2. The Commissioner shall approve a plan
submitted by the Advisory Organization for equitable apportionment among
insurers of those persons who in good faith are entitled to insurance but who
have not been accepted by an insurer. Every insurer shall participate in the
plan. The Commissioner shall adopt regulations to carry out the plan.
3. The Advisory Organization shall submit
to the Commissioner the rates, supplementary rate information and forms for
policies for the plan at least 60 days before they become effective. The rates
submitted to the Commissioner must:
(a) Reflect the experience of the persons insured
pursuant to the plan to the extent that those rates are actuarially
appropriate.
(b) Be actuarially determined to ensure that the
plan is self-sustaining.
4. The Commissioner shall disapprove any
rates for the plan which do not meet the standards of NRS
686B.050. The rates shall be deemed to be approved unless they are
disapproved by the Commissioner within 60 days after they are filed pursuant to
the procedures in NRS 686B.1775.
(Added to NRS by 1995, 2051; A 1997, 973; 1999, 428)
NRS 686B.1772 Insurers to adhere to Uniform System of Classifications of Risks
and Uniform Plan for Rating Experience; subclassifications for Uniform System
of Classification.
1. Every insurer shall adhere to the
Uniform System of Classifications of Risks and Uniform Plan for Rating
Experience filed with the Commissioner by the Advisory Organization.
2. Any insurer may develop a
subclassification or subclassifications for the Uniform System of
Classification. Any subclassification must be filed with the Commissioner 60
days before it becomes effective. The Commissioner shall disapprove the
subclassification if the insurer fails to show the data to be produced by it
will be consistent with the Uniform Statistical Plan and System of
Classification filed by the Advisory Organization with the Commissioner.
(Added to NRS by 1995, 2051)
NRS 686B.1773 Insurers to record and report certain information and adhere to
manual of rules and Uniform Plan for Rating Experience.
1. Every insurer shall:
(a) Record and report its experience and losses
for policies of industrial insurance to the Advisory Organization in a form
consistent with the Uniform Statistical Plan approved by the Commissioner; and
(b) Adhere to the manual of rules and Uniform
Plan for Rating Experience when providing or reporting its business for
industrial insurance.
2. No insurer may agree with another
insurer or the Advisory Organization to adhere to a manual of rules which is
not reasonably related to the recording or reporting of data according to the
Uniform Statistical Plan or Uniform System of Classifications filed by the
Advisory Organization.
(Added to NRS by 1995, 2051)
NRS 686B.1774 Commissioner to determine whether interaction among insurers and
employers is competitive.
1. The Commissioner shall determine
whether the interaction among insurers and employers for the buying and selling
of industrial insurance is competitive. Competition among these insurers is
presumed to exist unless the Commissioner specifically finds, after a hearing
and review of the structure, performance and conduct of the insurers, that there
is no reasonable degree of competition among them and that the interaction is
not competitive. Any finding by the Commissioner that there is no competition
among the insurers and that the interaction is not competitive, expires 1 year
after the date it is issued.
2. To determine whether competition exists
among insurers, the Commissioner shall review existing information available to
the Commissioner or participate in the development of new sources of such
information. The Commissioner may conduct his or her own studies, cooperate
with knowledgeable officers in other states, hire outside consultants or
conduct studies in any other appropriate manner.
(Added to NRS by 1995, 2052; A 1997, 1456; 1999, 2224)
NRS 686B.1775 Filing of rates and supplementary rate information by insurer
with Commissioner; findings of Commissioner.
1. Each insurer shall file with the
Commissioner all the rates, supplementary rate information, supporting data,
and changes and amendments thereof, except any information filed by the
Advisory Organization, which the insurer intends to use in this state. An
insurer may adopt by reference any supplementary rate information or supporting
data that has been previously filed by that insurer and approved by the
Commissioner. The filing must indicate the date the rates will become
effective. An insurer may file its rates pursuant to this subsection by filing:
(a) Final rates; or
(b) A multiplier and, if used by an insurer, a
premium charged to each policy of industrial insurance regardless of the size
of the policy which, when applied to the prospective loss costs filed by the
Advisory Organization pursuant to NRS 686B.177,
will result in final rates.
2. Each insurer shall file the rates,
supplementary rate information and supporting data pursuant to subsection 1:
(a) Except as otherwise provided in subsection 4,
if the interaction among insurers and employers is presumed or found to be
competitive, not later than 15 days before the date the rates become effective.
(b) If the Commissioner has issued a finding that
the interaction is not competitive, not later than 60 days before the rates
become effective.
3. If the information supplied by an
insurer pursuant to subsection 1 is insufficient, the Commissioner shall notify
the insurer and require the insurer to provide additional information. The
filing must not be deemed complete or available for use by the insurer and
review by the Commissioner must not commence until all the information
requested by the Commissioner is received by the Commissioner. If the requested
information is not received by the Commissioner within 60 days after its
request, the filing may be disapproved without further review.
4. If, after notice to the insurer and a
hearing, the Commissioner finds that an insurer’s rates require supervision
because of the insurer’s financial condition or because of rating practices
which are unfairly discriminatory, the Commissioner shall order the insurer to
file its rates, supplementary rate information, supporting data and any other
information required by the Commissioner, at least 60 days before they become
effective.
5. For any filing made by an insurer
pursuant to this section, the Commissioner may authorize an earlier effective
date for the rates upon a written request from the insurer.
6. Except as otherwise provided in
subsection 1, every rate filed by an insurer must be filed in the form and
manner prescribed by the Commissioner.
7. As used in this section, “supporting
data” means:
(a) The experience and judgment of the insurer
and of other insurers or of the Advisory Organization, if relied upon by the
insurer;
(b) The interpretation of any statistical data
relied upon by the insurer;
(c) A description of the actuarial and
statistical methods employed in setting the rates; and
(d) Any other relevant matters required by the
Commissioner.
(Added to NRS by 1995, 2052; A 1997, 1453; 1999, 444, 2221, 2224; 2001, 154)
NRS 686B.1777 When Commissioner may require supporting information regarding
rates; when hearing is required for disapproval of rates.
1. If the Commissioner finds that:
(a) The interaction among insurers is not
competitive;
(b) The rates filed by insurers whose interaction
is competitive are inadequate or unfairly discriminatory; or
(c) The rates violate the provisions of this
chapter,
Ê the
Commissioner may require the insurers to file information supporting their
existing rates. Before the Commissioner may disapprove those rates, the
Commissioner shall notify the insurers and hold a hearing on the rates and the
supplementary rate information.
2. The Commissioner may disapprove any
rate without a hearing. Any insurer whose rates are disapproved in this manner
may request in writing and within 30 days after the disapproval that the
Commissioner conduct a hearing on the matter.
(Added to NRS by 1995, 2053; A 1997, 1454; 1999, 444, 2222, 2224; 2001, 154)
NRS 686B.1779 Grounds for disapproval of rates.
1. The Commissioner may disapprove a rate
filed by an insurer at any time.
2. The Commissioner shall disapprove a
rate if:
(a) An insurer has failed to meet the
requirements for filing a rate pursuant to this chapter or the regulations of
the Commissioner;
(b) The rate is inadequate or unfairly discriminatory
and the interaction among insurers and employers is competitive; or
(c) A rate is inadequate, excessive or unfairly
discriminatory and the Commissioner has found and issued an order that the
interaction among the insurers and employers is not competitive.
(Added to NRS by 1995, 2053; A 1997, 1455; 1999, 444, 2223, 2224; 2001, 154)
NRS 686B.178 Commissioner to issue written order stating reasons for
disapproval and date by which insurer must discontinue use of rate. If the Commissioner disapproves a rate, the
Commissioner shall issue a written order stating the reasons for the
disapproval and stating the date when the rate must no longer be used for
policies which are issued or renewed. The date established by the Commissioner
must be within a reasonable period after the written order is issued. The
Commissioner shall issue the order within 30 days after the hearing. The
Commissioner may require that the premiums be adjusted after the date of the order
for those policies in effect on the date of the order.
(Added to NRS by 1995, 2053)
NRS 686B.1781 Payment of dividends: Prohibition against discrimination;
submission of plan for payments related to industrial insurance.
1. An insurer shall not unfairly
discriminate among its policyholders in paying a dividend, savings, unearned
premium deposits or an equivalent abatement of premiums allowed or returned by
an insurer for a policy of industrial insurance.
2. A plan for the payment of dividends for
industrial insurance must be filed before there is a dividend payment. The plan
shall be deemed approved unless the Commissioner disapproves the plan within 30
days after it is filed and received by the Commissioner. An insurer shall not
condition the payment of a dividend upon the renewal of a policy or contract by
the policyholder, member or subscriber.
3. An insurer paying savings, unearned
premium deposits or an equivalent abatement for premiums allowed or returned
for a policy of industrial insurance must receive prior approval.
(Added to NRS by 1995, 2053; A 2003, 3305)
NRS 686B.1782 Agreements to lessen competition among insurers prohibited;
insurers prohibited from agreeing to rates established in manner that conflicts
with provisions.
1. No insurer or advisory organization may
make any agreement with any person, insurer or advisory organization to
restrain trade unreasonably or to lessen substantially the competition between
insurers.
2. No insurer may agree to use any rate,
rating plan or rating rules, other than the uniform plan for rating experience,
except as necessary to comply with the provisions of this chapter concerning
the activity of the Advisory Organization and insurers relating to the Uniform
Statistical Plan, the Uniform Plan for Rating Experience and the Uniform System
of Classifications of Risks and the development of subclassifications.
3. The fact that two or more insurers,
whether or not they subscribe to the Advisory Organization, use consistently or
intermittently the same rates, rating plans, rating schedules, rating rules,
classifications for rates, rules for underwriting, surveys, inspections or
similar materials does not require a finding by the Commissioner that an
agreement to restrain trade or lessen competition exists.
4. Two or more insurers which are commonly
owned or operated in this state with common management or control may act or
agree to act among themselves as if they were a single insurer for any
activities authorized by NRS 686B.1751 to 686B.1799, inclusive.
(Added to NRS by 1995, 2053)
NRS 686B.1783 Maintenance of records; examination of records by Commissioner. Every insurer, advisory organization and plan
for apportioned risks shall maintain records of the kind reasonably adapted to
its method of operation and reflecting its experience or the experience of its
members and the data or other information collected or used by it. The
Commissioner may examine those records at any reasonable time to determine
whether the activities of the insurer, advisory organization or plan for
apportioned risks comply with the provisions of this chapter and chapters 616A to 617,
inclusive, of NRS. These records must be maintained in an office in this state
or must be made available to the Commissioner for examination or inspection at
any time after reasonable notice to the insurer, advisory organization or plan
for apportioned risks.
(Added to NRS by 1995, 2054)
NRS 686B.1784 Examination by Commissioner; cost of examination.
1. The Commissioner may examine any
insurer, advisory organization or plan for apportioned risks whenever the
Commissioner determines that such an examination is necessary.
2. The reasonable cost of an examination
must be paid by the insurer or other person examined upon presentation by the
Commissioner of an accounting of those costs pursuant to NRS 679B.290.
3. In lieu of an examination, the
Commissioner may accept the report of an examination made by the agency of
another state that regulates insurance.
(Added to NRS by 1995, 2054; A 1999, 2223)
NRS 686B.1785 Request for reconsideration of rates; appeal. Any person aggrieved by any decision, action
or omission of the Advisory Organization or an insurer regarding rates or other
information filed with the Commissioner may request in writing that the
Organization or insurer reconsider the decision, action or omission. Except as
otherwise provided in NRS 616B.772, 616B.775 and 616B.787, if the request for
reconsideration is rejected or is not acted upon within 30 days by the
Organization or insurer, the person requesting reconsideration may, within 30
days thereafter, appeal from the decision, action or omission to the
Commissioner by filing a written complaint and request for a hearing specifying
the grounds relied upon.
(Added to NRS by 1995, 2054; A 1999, 3381; 2001, 2256)
NRS 686B.1787 Insurer or advisory organization may request hearing before
Commissioner. Any insurer or
advisory organization, to which is directed any order made or action taken by
the Commissioner without a hearing, may request a hearing before the
Commissioner.
(Added to NRS by 1995, 2054)
NRS 686B.1789 Provisions governing hearing. A
hearing required by any of the provisions of NRS
686B.1751 to 686B.1799, inclusive, is
governed by NRS 679B.310 to 679B.370, inclusive, except that any
limits of time imposed by NRS 686B.1751 to 686B.1799, inclusive, control.
(Added to NRS by 1995, 2054)
NRS 686B.179 Revocation or suspension of license. The
Commissioner may, after notice and hearing, revoke or suspend the license of an
advisory organization for failure to comply with the provisions of this
chapter.
(Added to NRS by 1995, 2055)
NRS 686B.1793 Penalties.
1. An insurer or other person who violates
any provision of NRS 686B.1751 to 686B.1799, inclusive, shall, upon the order of the
Commissioner, pay an administrative fine not to exceed $1,000 for each
violation and not to exceed $10,000 for each willful violation. These
administrative fines are in addition to any other penalty provided by law. Any
insurer using a rate before it has been filed with the Commissioner as required
by NRS 686B.1775, shall be deemed to have
committed a separate violation for each day the insurer failed to file the
rate.
2. The Commissioner may suspend or revoke
the license of any advisory organization or insurer who fails to comply with an
order within the time specified by the Commissioner or any extension of that
time made by the Commissioner. Any suspension of a license is effective for the
time stated by the Commissioner in his or her order or until the order is
modified, rescinded or reversed.
3. The Commissioner, by written order, may
impose a penalty or suspend a license pursuant to this section only after
written notice to the insurer, organization or plan for apportioned risks and a
hearing.
(Added to NRS by 1995, 2055; A 1999, 2223)
NRS 686B.1797 Insurer prohibited from withholding or giving false or
misleading information to Commissioner or Advisory Organization. An insurer or other person shall not willfully
withhold information from, or knowingly give false or misleading information
to, the Commissioner or to the Advisory Organization, which will affect the
rates, classifications of risks or Uniform Statistical Plan for industrial
insurance.
(Added to NRS by 1995, 2055)
NRS 686B.1799 Limitation on liability of insurer or rating organization acting
within scope of employment. No
insurer or rating organization or member thereof in its capacity as a member or
officer or employee of the licensed rating organization when acting within the
scope of his or her employment is liable for injury or death or other damage
proximately caused by a failure to inspect, or the manner or extent of
inspection of, an employer’s locations, plants or operations for
classification, control of losses or rating, or by that person’s comment or
failure to comment on the subject matter or object of the inspection.
(Added to NRS by 1995, 2055)
ESSENTIAL INSURANCE
General Provisions
NRS 686B.180 Unavailability of essential coverage; plans for providing
coverage.
1. If the Commissioner finds after a
hearing that in any part of this state any essential insurance coverage is not
readily available in the voluntary market, and that the public interest
requires such availability, the Commissioner may by regulation promulgate plans
to provide such insurance coverages for any risks in this state which are
equitably entitled to but otherwise unable to obtain such coverage, or may call
upon insurers to prepare plans for approval by the Commissioner. Such plans may
also include any kind of reinsurance that is unavailable and that would
facilitate making essential insurance coverage available where it would
otherwise not be available.
2. The plan promulgated or prepared under
subsection 1 must:
(a) Give consideration to the need for adequate
and readily accessible coverage, alternative methods of improving the market
affected, the preferences of the insurers and agents, the inherent limitations
of the insurance mechanism, the need for reasonable underwriting standards, and
the requirement of reasonable loss-prevention measures;
(b) Establish procedures that will create minimum
interference with the voluntary market;
(c) Spread the burden imposed by the facility
equitably and efficiently among insurers; and
(d) Establish procedures for applicants and
participants to have grievances reviewed by an impartial body.
3. Each plan must require participation by
all insurers doing any business in this state of the kinds covered by the
specific plan and all agents licensed to represent such insurers in this state
for the specified kinds of business, except that the Commissioner may exclude
kinds of insurance, classes of insurers or classes of persons for
administrative convenience or because it is not equitable or practicable to
require them to participate in the plan.
4. The plan may provide for optional
participation by insurers not required to participate under subsection 3.
5. Each plan must provide for the method
of underwriting and classifying risks, making and filing rates, adjusting and
processing claims and any other insurance or investment function that is
necessary for the purpose of providing essential insurance coverage.
6. In providing for the recoupment of
deficits which may be incurred in the plan, an option must be offered to an
insured each policy year to pay a capital stabilization charge which must not
exceed 100 percent of the premium charged to the insured in that year. The
Commissioner shall determine the amount of the charge from appropriate factors
of loss experience and risk associated with the plan and the insured. An
insured who pays the stabilization charge must not be required to pay any
assessment to recoup a deficit in the plan incurred in any policy year for
which the charge is paid. The plan must provide for the return to the insured
of so much of the insured’s payment as remains after all actual or potential liabilities
under the policy have been discharged.
7. The plan must specify the basis of
participation and assessment of insurers as necessary and must provide for the
participation of agents and the conditions under which risks must be accepted.
8. Every participating insurer and agent
shall provide to any person seeking coverages of kinds available in the plans
the services prescribed in the plans, including full information on the
requirements and procedures for obtaining coverage under the plans whenever the
business is not placed in the voluntary market.
9. The plan must specify what commission
rates must be paid for business placed in the plans.
10. If the Commissioner finds that the
lack of cooperating insurers or agents in an area makes the functioning of the
plan difficult, the Commissioner may order that the plan set up a branch
service office or take other appropriate steps to insure that service is
available.
(Added to NRS by 1971, 1706; A 1975, 402; 1977, 303; 1985, 1069)
NRS 686B.185 Immunity of Commissioner and association. There is no liability on the part of, and no
cause of action of any nature arises against, the Commissioner or the
representatives of the Commissioner or any essential insurance association, its
agents or employees, under a plan established pursuant to the provisions of NRS 686B.180, for any good faith action taken by them
in the performance of their powers and duties under such plan.
(Added to NRS by 1975, 403)
NRS 686B.200 Voluntary plan for sharing risks. Insurers
doing business within this state are authorized to prepare voluntary plans
providing any specified kind, line or class of insurance coverage or
subdivision or combination thereof for all or any part of this state in which
such insurance is not readily available in the voluntary market and in which
the public interest requires the availability of such coverage. Such plans
shall be submitted to the Commissioner and if approved by the Commissioner may
be put into operation.
(Added to NRS by 1971, 1707)
Associations
NRS 686B.210 Nevada Essential Insurance Association: Establishment;
membership; plan of operation.
1. If after a hearing the Commissioner
determines that a voluntary or mandatory plan would, in the judgment of the
Commissioner, fail for any reason to provide essential insurance coverage, the
Commissioner may, by regulation, establish a nonprofit unincorporated legal
entity to be known as the Nevada Essential Insurance Association. All insurers
required to participate pursuant to subsection 3 of NRS
686B.180 shall become members of the Association as a condition of their
authority to transact insurance in this state.
2. The Association shall perform its
functions under a plan of operation established by regulations promulgated by
the Commissioner pursuant to subsection 1 of NRS 686B.180.
(Added to NRS by 1975, 398)
NRS 686B.220 Nevada Essential Insurance Association: Board of Directors;
reimbursement of members of Board; approval or adoption of plan by
Commissioner.
1. The administrative powers of the Nevada
Essential Insurance Association shall be vested in a Board of Directors
consisting of not less than five nor more than nine members serving terms as
established in the plan of organization. The members of the Board shall be
appointed by the Commissioner with due consideration given to the composition
of the membership of the Association and to the interests of the insureds who
are provided essential insurance coverage by the Association.
2. Members of the Board may be reimbursed
from the assets of the Association for expenses incurred by them as members of
the Board of Directors and for reasonable and equitable compensation as may be
prescribed by the terms of the plan of organization.
3. The Board of Directors of the
Association shall submit to the Commissioner a plan of organization for the
Association and make suitable or necessary amendments thereto to assure the
fair, reasonable and equitable administration of the Association. The plan of
operation shall become effective upon approval in writing by the Commissioner.
4. If the Association fails to submit a
suitable plan of operation within a reasonable period of time, or if at any
time thereafter the Association fails to submit suitable amendments to the
plan, the Commissioner shall promulgate a plan as necessary or advisable to
effectuate the provisions of this section.
(Added to NRS by 1975, 398)
NRS 686B.230 Nevada Essential Insurance Association: General powers.
1. The Nevada Essential Insurance
Association has, for purposes of this section and to the extent approved by the
Commissioner, the general powers and authority granted under the laws of this
state to carriers licensed to transact the kinds of insurance defined in NRS 681A.020 to 681A.080, inclusive.
2. The Association may take any necessary
action to make available necessary insurance, including but not limited to, the
following:
(a) Assess participating insurers amounts
necessary to pay the obligations of the Association, administration expenses,
the cost of examinations conducted pursuant to NRS 687A.110 and other expenses
authorized by this chapter. The assessment of each member insurer for the kind
or kinds of insurance designated in the plan must be in the proportion that the
net direct written premiums of the member insurer for the preceding calendar
year bear to the net direct written premiums of all member insurers for the
preceding calendar year. A member insurer may not be assessed in any year an
amount greater than 5 percent of his or her net direct written premiums for the
preceding calendar year. Each member insurer must be allowed a premium tax
credit at the rate of 20 percent per year for 5 successive years beginning on
the first day of the calendar year after the calendar year in which the insurer
pays the assessment pursuant to this subsection.
(b) Enter into such contracts as are necessary or
proper to carry out the provisions and purposes of this section.
(c) Sue or be sued, including taking any legal
action necessary to recover any assessments for, on behalf of or against
participating carriers.
(d) Investigate claims brought against the fund
and adjust, compromise, settle and pay covered claims to the extent of the
Association’s obligation and deny all other claims. Process claims through its
employees or through one or more member insurers or other persons designated as
servicing facilities. Designation of a service facility is subject to the
approval of the Commissioner, but such a designation may be declined by a
member insurer.
(e) Classify risks as may be applicable and
equitable.
(f) Establish appropriate rates, rate classifications
and rating adjustments and file those rates with the Commissioner in accordance
with this chapter.
(g) Administer any type of reinsurance program
for or on behalf of the Association or any participating carriers.
(h) Pool risks among participating carriers.
(i) Issue and market, through agents, policies of
insurance providing the coverage required by this section in its own name or on
behalf of participating carriers.
(j) Administer separate pools, separate accounts
or other plans as may be deemed appropriate for separate carriers or groups of
carriers.
(k) Invest, reinvest and administer all funds and
moneys held by the Association.
(l) Borrow funds needed by the Association to
carry out the purposes of this section.
(m) Develop, effectuate and promulgate any
loss-prevention programs aimed at the best interests of the Association and the
insuring public.
(n) Operate and administer any combination of
plans, pools, reinsurance arrangements or other mechanisms as deemed
appropriate to best accomplish the fair and equitable operation of the
Association for the purposes of making available essential insurance coverage.
3. In providing for the recoupment of a
deficit of the Association, an option must be offered to an insured each policy
year to pay a capital stabilization charge which must not exceed 100 percent of
the premium charged to the insured in that year. The Board of Directors shall
determine the amount of the charge from appropriate factors of loss experience
and risk associated with the Association and the insured. An insured who pays
the stabilization charge must not be required to pay any assessment to recoup a
deficit of the Association incurred in any policy year for which the charge is
paid. The Association’s plan of operation must provide for the return to the
insured of so much of the insured’s payment as remains after all actual or
potential liabilities under the policy have been discharged.
(Added to NRS by 1975, 398; A 1977, 305; 2003, 3305)
NRS 686B.240 Nevada Essential Insurance Association: Powers of Commissioner
and Association. The Commissioner
and the Nevada Essential Insurance Association may:
1. Give consideration to the need for
adequate and readily accessible coverage, to alternative methods of improving
the market affected, to the preferences of the insurers and agents, to the
inherent limitations of the insurance mechanism, to the need for reasonable
underwriting standards and to the requirement of reasonable loss-prevention
measures.
2. Establish procedures that will create
minimum interference with the voluntary market.
3. Spread the burden imposed by the
facility equitably and efficiently.
4. Establish procedures for applicants and
participants to have grievances reviewed.
5. Take all reasonable and necessary steps
to dissolve the Association at the earliest date when essential insurance
becomes readily available in the private market. The dissolution of the
Association, including its assets and liabilities, must be accomplished under the
supervision of the Commissioner in an equitable and reasonable manner. The
dissolution must, if determined to be appropriate by the Commissioner, provide
for the repayment of any loans or other money provided or contributed by the
State of Nevada for the formation or continuance of the Association.
(Added to NRS by 1975, 399; A 2003, 3306)
NRS 686B.250 Nevada Essential Insurance Association: Immunity from liability. There is no liability on the part of, and no
cause of action of any nature arises against, the Nevada Essential Insurance
Association or its agents or employees, members of the Board or the
Commissioner or the representatives of the Commissioner for any good faith
performance of their powers and duties under NRS
686B.210 to 686B.240, inclusive.
(Added to NRS by 1975, 400)
NRS 686B.260 Conversion into domestic stock insurer: “Insured” defined. As used in NRS
686B.270 to 686B.320, inclusive, unless the
context otherwise requires, “insured” means any person who has maintained at
least 1 year of coverage with an essential insurance association.
(Added to NRS by 1981, 1021)
NRS 686B.270 Conversion into domestic stock insurer: Applicability of certain
provisions governing nonprofit cooperative corporations. The provisions of NRS 81.130 and 81.510 do not apply to the conversion of
an essential insurance association to a domestic stock insurer as provided in NRS 686B.280 to 686B.320,
inclusive.
(Added to NRS by 1981, 1023; A 1985, 1878; 1991, 1318)
NRS 686B.280 Conversion into domestic stock insurer: Filing and contents of
notice of intent to qualify.
1. An essential insurance association
shall, whenever requested to do so by the Commissioner, file a notice of intent
to qualify as a domestic stock insurer. In the absence of a request by the
Commissioner, an essential insurance association may file such a notice
whenever it considers it appropriate.
2. The notice must be filed with the
Commissioner at least 4 months before the date the association is to become a
domestic stock insurer and must contain:
(a) An application prepared pursuant to chapter 680A of NRS for a certificate of
authority to transact business in Nevada as a domestic stock insurer;
(b) A valuation of capital and surplus according
to both market and amortized value based on the association’s annual financial
statement for the previous year;
(c) The value and number of shares of stock to
which each insured is entitled; and
(d) The terms of any proposal offering money or
its equivalent in lieu of issuing fractional shares.
(Added to NRS by 1981, 1021)
NRS 686B.290 Conversion into domestic stock insurer: Notice to insurers and
insureds; hearing.
1. At the time the association files a
notice of intent to qualify as a domestic stock insurer, it must give notice of
its intent to all participating insurers and all insureds on a form approved by
the Commissioner. The notice to each insured must state the total amount of
stock to be issued and the amount of shares to which the insured is entitled.
2. Any participating insurer or insured
may, within 30 days after the date of the notice, apply to the Division for a
hearing concerning the association’s ability to qualify as a domestic insurer,
the valuation of capital and surplus, or the proposed number and distribution
of shares of stock.
(Added to NRS by 1981, 1022; A 1991, 1630; 1993, 1917; 2003, 3307)
NRS 686B.300 Conversion into domestic stock insurer: Determination of
percentage of stock for each insured. The
association shall determine the percentage of stock to which each insured is
entitled as follows:
1. The amount of gain or loss from
operations, including an equitable allocation of investment income attributable
to operations, is calculated for each of the following groups:
(a) Insureds who have not paid a capital
stabilization charge;
(b) Insureds who have paid this charge for a
given policy year; and
(c) Insureds who have paid a single charge to
cover all policy years of participation in the association.
2. For each calendar year the association
has been in operation, the amount of gain or loss from operations, including an
equitable allocation of investment income attributable to each group, is
divided by the number of insured months in that group.
3. For each group in which an insured
participated in any calendar year, the insured’s number of insured months in
that group is multiplied by the amount of income per insured month attributable
to that group, as determined in subsection 2.
4. For each insured, the results of the
calculations performed under subsection 3 for each group in which the insured
was a member during a particular calendar year are added.
5. For each insured, the total amount the
insured paid in capital stabilization charges is computed.
6. For each insured, the sum of the
results of the calculations performed under subsections 4 and 5 are divided by
the total surplus of the association as shown in its financial statement for
the year preceding its conversion to a domestic stock insurer, to obtain that
insured’s percentage of ownership of the total stock to be distributed.
(Added to NRS by 1981, 1022)
NRS 686B.310 Conversion into domestic stock insurer: Capitalization. An association must comply with the provisions
of NRS 680A.120 to qualify as a
domestic stock insurer. Any paid-in capital in excess of the minimum amount
required may be shown as surplus.
(Added to NRS by 1981, 1023)
NRS 686B.320 Conversion into domestic stock insurer: Issuance of certificate
of authority. Upon determining
that the Association has complied with NRS 686B.280
to 686B.310, inclusive, and all other requirements
applicable to domestic stock insurers, the Commissioner may issue to the
Association a certificate of authority to transact business as a domestic stock
insurer.
(Added to NRS by 1981, 1023; A 2003, 3307)
NRS 686B.330 Conversion into domestic mutual insurer or domestic reciprocal
insurer: “Insured” defined. As
used in NRS 686B.330 to 686B.370,
inclusive, unless the context otherwise requires, “insured” has the meaning
ascribed to it in NRS 686B.260.
(Added to NRS by 2003, 3303)
NRS 686B.340 Conversion into domestic mutual insurer or domestic reciprocal
insurer: Exemption from applicability of NRS 81.130
and 81.510. The
provisions of NRS 81.130 and 81.510 do not apply to the conversion of
an essential insurance association to a domestic mutual insurer or a domestic
reciprocal insurer as provided in NRS 686B.330 to 686B.370, inclusive.
(Added to NRS by 2003, 3304)
NRS 686B.350 Conversion into domestic mutual insurer or domestic reciprocal insurer:
Filing and contents of notice of intent to qualify.
1. An essential insurance association
shall, if requested to do so by the Commissioner, file a notice of intent to
qualify as a domestic mutual insurer or a domestic reciprocal insurer. In the absence
of a request by the Commissioner, an essential insurance association may file
such a notice at such time as the association determines appropriate.
2. The notice must be filed with the
Commissioner at least 4 months before the date the association is to become a
domestic mutual insurer or a domestic reciprocal insurer and must include:
(a) An application prepared pursuant to chapter 680A of NRS for a certificate of
authority to transact business in Nevada as a domestic mutual insurer or a
domestic reciprocal insurer;
(b) A valuation of the policyholder’s surplus
according to both market and amortized value based on the association’s annual
financial statement for the previous year; and
(c) A provision for the return of any unused
portion of the insured’s capital stabilization charges.
(Added to NRS by 2003, 3304)
NRS 686B.360 Conversion into domestic mutual insurer or domestic reciprocal
insurer: Notice to insurers and insured; hearing.
1. At the time the association files a
notice of intent to qualify as a domestic mutual insurer or domestic reciprocal
insurer, it must give a notice of intent to all participating insurers and all
insureds on a form approved by the Commissioner.
2. Any participating insurer or insured
may, within 30 days after the date of the notice, apply to the Division for a
hearing concerning the association’s ability to qualify as a domestic mutual
insurer or domestic reciprocal insurer.
3. An association must comply with the
provisions of:
(a) Chapter 692B
of NRS, as applicable to mutual insurers, to qualify as a domestic mutual
insurer; or
(b) Chapter 694B
of NRS, as applicable to reciprocal insurers, to qualify as a domestic
reciprocal insurer.
(Added to NRS by 2003, 3304)
NRS 686B.370 Conversion into domestic mutual insurer or domestic reciprocal
insurer: Issuance of certificate of authority. Upon
determining that an association has complied with NRS
686B.330 to 686B.370, inclusive, and all other
requirements applicable to domestic mutual insurers, if the association is
qualifying as a domestic mutual insurer, or to domestic reciprocal insurers, if
the association is qualifying as a domestic reciprocal insurer, the
Commissioner may issue to the association a certificate of authority to
transact business as a domestic mutual insurer or a domestic reciprocal
insurer.
(Added to NRS by 2003, 3304)
