Nrs: Chapter 686B - Rates And Essential Insurance

Link to law: https://www.leg.state.nv.us/NRS/NRS-686B.html
Published: 2015

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[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.

_________

_________

 

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)