[Rev. 8/6/2022 10:35:42 PM]
[NAC-683A Revised Date: 7-22]
CHAPTER 683A - PERSONS INVOLVED IN SALE OR ADMINISTRATION OF INSURANCE
GENERAL PROVISIONS
683A.005 Definitions.
LICENSING OF BANKS
683A.080 Adoption of definitions pertaining to certain restrictions on licensing.
683A.082 “Affiliate” defined.
683A.086 “Company” defined.
683A.088 “Control” defined.
683A.089 “Credit property insurance” defined.
683A.090 “Demand deposit” defined.
683A.092 “Parent” defined.
683A.094 “Subsidiary” defined.
ADMINISTRATORS
683A.100 “Insurer” defined.
683A.103 Interpretation of terms used in definition of “administrator.”
683A.105 Applicant for certificate of registration: Submission of financial statement.
683A.115 Evaluation of applicant.
683A.119 Determination of whether administrator or applicant is financially unsound.
683A.125 Duty to notify Commissioner of certain changes.
683A.131 Annual report: Contents of financial statement.
683A.155 Amount of bond; certificate of deposit in lieu of bond.
683A.165 Administrator of self-insurance reserve fund.
PRELICENSING EDUCATION
683A.170 Exemptions.
683A.180 Course of instruction required; passing grade.
683A.190 Approval of course of instruction and instructor.
683A.201 Qualifications of instructor; limitation on instruction by unqualified instructor or mechanical aid.
683A.211 Correspondence, extension or self-study course.
683A.221 Subject matter of courses; hours of instruction.
683A.225 Course of instruction for bail bonds.
683A.231 Records; submission of certain information quarterly; certificate of completion for student.
683A.241 Changes in sponsor, instructor or outline of course; suspension and revocation of approval of course.
683A.251 Submission or issuance of false or fraudulent documents; determination of sponsor or instructor as unsuitable person.
683A.261 Forms.
LICENSING OF PRODUCERS OF INSURANCE AND INSURANCE CONSULTANTS
683A.270 Required score on examination.
683A.272 Search of records of criminal history.
683A.275 Short-term lessor of passenger vehicles: Licensure requirement; provision for training and supervision of employees; maintenance and availability of records.
REGISTRATION OF AGENTS WHO PERFORM UTILIZATION REVIEW
683A.280 Definitions.
683A.285 Registration of insurer; plan for utilization review; insurer to report changes; renewal of registration.
683A.290 Employee of registered agent not required to pay certain fees for registration or renewal.
683A.295 Fees for photocopies of plan for utilization review; written request for photocopies required.
MISCELLANEOUS PROVISIONS
683A.310 Payments of premium made after termination of producer’s agreement.
683A.315 Sale of annuities by banks: Required disclosures.
683A.317 Renewal of appointment of producer of insurance: Verification of records; fee.
CONTINUING EDUCATION
683A.318 Definitions.
683A.320 “Course” defined.
683A.322 “Designated representative” defined.
683A.325 Applicability of provisions.
683A.327 Designated representative: Authority of Commissioner.
683A.330 Requirements for renewal of license.
683A.335 Requirements for approval of courses.
683A.337 Requirements for advertisement of courses.
683A.340 Duties of providers of approved courses.
683A.345 Credit for completion of certain unapproved courses.
683A.350 Number of hours approved for certain courses; credit for licensee who attends or teaches course.
683A.355 Limitations on receipt and use of credit.
683A.360 Verification of continuing education.
683A.365 Suspension or revocation of approval of course; auditing of course; reinstatement of approval.
683A.370 Compliance with requirements; submission of false or fraudulent affidavit.
FIDUCIARY ACCOUNTS
683A.390 “Licensee” defined.
683A.400 Authorized types of accounts.
683A.410 Licensee to be named as trustee; signature cards.
683A.420 Formula for determining status of fiduciary account.
683A.430 Curing of deficiency.
683A.440 Failure to remit return premium.
MANAGING GENERAL AGENTS
683A.450 Definitions.
683A.460 Licensing and bonding; maintenance of policy for errors and omissions.
683A.470 Written contract with insurer.
683A.480 Accounts, books and records.
683A.490 Retention of reserve; assignment of contract with insurer.
683A.500 Authority of insurer to terminate contract with agent, suspend agent’s authority, and cancel or refuse to renew policy.
683A.510 Handling of claims which agent has authority to settle; suspension and termination of authority to settle claims.
683A.520 Sharing of profits between agent and insurer.
683A.530 Prohibited acts of agent.
683A.540 Duties of insurers.
683A.550 Acts of agent deemed to be acts of insurer; examination of agent.
683A.560 Disciplinary action; rights of policyholders, claimants and auditors not restricted.
EXTERNAL REVIEW ORGANIZATIONS
Certification
683A.600 Application for initial issuance of certificate: Generally.
683A.610 Application for initial issuance of certificate: Organization certified or accredited by accrediting body that is nationally recognized.
683A.620 Issuance of certificate by Commissioner.
683A.630 Expiration and renewal of certificate.
683A.640 Fees of Commissioner.
683A.650 Refusal, suspension or revocation of certification: Grounds; surrender of certificate.
683A.660 Duties of organization upon termination of certification or accreditation by accrediting body that is nationally recognized.
Conduct of Business
683A.670 Fees to conduct external reviews.
DUTIES OF BROKERS TO CLIENTS
683A.700 Definitions.
683A.702 “Affiliate” defined.
683A.704 “Broker” defined.
683A.706 “Client” defined.
683A.708 “Compensation” defined.
683A.710 “Represents” defined.
683A.712 “Transaction” defined.
683A.714 Applicability of duties.
683A.716 Self-dealing; disclosures concerning compensation and certain quotes.
683A.718 Effect of violation.
CONTINUOUS CARE COVERAGE
683A.750 “Continuous care coverage” defined.
683A.760 Licensing required to sell, solicit or negotiate continuous care coverage.
683A.770 Instruction required for approval of request to sell, solicit and negotiate continuous care coverage.
683A.780 Instruction counts toward continuing education hours.
GENERAL PROVISIONS
NAC 683A.005 Definitions. (NRS 679B.130) As used in this chapter, unless the context otherwise requires:
1. “Commissioner” means the Commissioner of Insurance of the Division.
2. “Division” means the Division of Insurance of the Department of Business and Industry.
3. “Unsuitable person” has the meaning ascribed to it in NAC 679B.039.
(Supplied in codification; A by Comm’r of Insurance by R152-99, 1-28-2000)
LICENSING OF BANKS
NAC 683A.080 Adoption of definitions pertaining to certain restrictions on licensing. (NRS 679B.130, 683A.231)
1. To carry out the purposes of NRS 683A.231, the Commissioner adopts the definitions set forth in NAC 683A.082 to 683A.094, inclusive.
2. As used in NAC 683A.082 to 683A.094, inclusive, “person” means a natural person, corporation, association, partnership or other legal entity.
(Added to NAC by Comm’r of Insurance, eff. 8-2-82; A 1-19-84; 5-27-92; 5-23-96)
NAC 683A.082 “Affiliate” defined. (NRS 679B.130, 683A.231) “Affiliate” means any person who, directly or indirectly, controls, is controlled by or is under common control with a bank located in this State that accepts deposits that the depositor has a legal right to withdraw on demand.
(Added to NAC by Comm’r of Insurance, eff. 8-2-82; A 5-23-96)
NAC 683A.086 “Company” defined. (NRS 679B.130, 683A.231) “Company” means persons interested in some commercial or industrial undertaking, or other legitimate business, but does not include a corporation in which the United States or any state owns a majority of the shares.
(Added to NAC by Comm’r of Insurance, eff. 8-2-82)
NAC 683A.088 “Control” defined. (NRS 679B.130, 683A.231)
1. “Control” means the possession, by any means, direct or indirect, of the power to direct or cause the direction of the management and policies of a person, including a bank.
2. Control will be presumed to exist if any person, directly or indirectly, owns, controls, holds with the power to vote or holds proxies representing 25 percent or more of the voting securities of any other person, including a bank.
(Added to NAC by Comm’r of Insurance, eff. 8-2-82)
NAC 683A.089 “Credit property insurance” defined. (NRS 679B.130, 683A.231) “Credit property insurance” means insurance which provides for payment of:
1. The outstanding balance of a loan if the property given as security for the loan is destroyed; or
2. The cost of repairing the property given as security for the loan up to the amount of the outstanding balance of the loan.
(Added to NAC by Comm’r of Insurance, eff. 1-19-84)
NAC 683A.090 “Demand deposit” defined. (NRS 679B.130, 683A.231) “Demand deposit” means a deposit that the depositor has a legal right to withdraw upon a proper written request.
(Added to NAC by Comm’r of Insurance, eff. 8-2-82)
NAC 683A.092 “Parent” defined. (NRS 679B.130, 683A.231) “Parent” means a person who owns or controls, directly or indirectly, in whole or in part, a bank located in this State that accepts deposits that the depositor has a legal right to withdraw on demand, or a bank holding company.
(Added to NAC by Comm’r of Insurance, eff. 8-2-82; A 5-23-96)
NAC 683A.094 “Subsidiary” defined. (NRS 679B.130, 683A.231) “Subsidiary” means any person owned or controlled, directly or indirectly, in whole or in part, by a bank located in this State that accepts deposits that the depositor has a legal right to withdraw on demand, or a bank holding company.
(Added to NAC by Comm’r of Insurance, eff. 8-2-82; A 5-23-96)
ADMINISTRATORS
NAC 683A.100 “Insurer” defined. (NRS 679B.130) Unless the context otherwise requires, any reference to “insurer” contained in NRS 683A.025, 683A.085 to 683A.0893, inclusive, and NAC 683A.105 to 683A.165, inclusive, shall be deemed to include any employer for whom a program of self-insurance is administered by an administrator.
(Added to NAC by Comm’r of Insurance, eff. 11-21-88)
NAC 683A.103 Interpretation of terms used in definition of “administrator.” (NRS 679B.130, 683A.025)
1. For the purposes of subsection 1 of NRS 683A.025, the “adjustment or settlement of claims” includes, but is not limited to:
(a) Investigating or examining claims; or
(b) Receiving, disbursing, handling or otherwise being responsible for the claim funds,
Ê of an insurance company, internal service fund, program of self-insurance, or other entity which is an administrator pursuant to NRS 683A.025.
2. The exemption from the definition of “administrator” provided by paragraph (d) of subsection 2 of NRS 683A.025 does not apply to any separate subsidiary or affiliated corporation of an insurance company.
(Added to NAC by Comm’r of Insurance, eff. 11-21-88; A 12-15-94; R152-99, 1-28-2000)
NAC 683A.105 Applicant for certificate of registration: Submission of financial statement. (NRS 679B.130, 683A.08522)
1. Each applicant for a certificate of registration as an administrator shall submit:
(a) If the applicant is a newly formed business:
(1) A financial statement pursuant to subsection 1 of NRS 683A.08522 that has been reviewed by an independent certified public accountant;
(2) A financial statement pursuant to subsection 2 that has been audited by an independent certified public accountant; or
(3) A pro forma balance sheet and a statement listing estimated income and expenses for the first year, compiled in a form which complies with generally accepted accounting principles.
(b) If the applicant is not a newly formed business:
(1) A financial statement pursuant to subsection 1 of NRS 683A.08522 that has been reviewed by an independent certified public accountant; or
(2) A financial statement pursuant to subsection 2 that has been audited by an independent certified public accountant.
(c) Evidence of the ability of the applicant to pay its obligations when they are due. The Division, in determining an applicant’s ability to pay its obligations when due, will consider the capitalization and current financial condition of the applicant and may request credit reports of the applicant and the owners.
2. An applicant for a certificate of registration as an administrator may satisfy the requirements set forth in subsection 1 of NRS 683A.08522 by submitting a financial statement of the parent company of the applicant if:
(a) The applicant:
(1) Is a wholly owned subsidiary of the parent company; and
(2) Provides a parental guaranty of performance for a period of not less than 1 year which is signed by an officer of the parent company and which guarantees the financial solvency of the applicant; and
(b) The financial statement of the parent company:
(1) Is certified by an officer of the applicant and by an officer of the parent company;
(2) Satisfies the requirements set forth in subsection 1 of NRS 683A.08522; and
(3) Has been audited by an independent certified public accountant.
3. The financial statement of an applicant for a certificate of registration as an administrator submitted pursuant to subsection 2 of this section or subsection 1 of NRS 683A.08522, as applicable, must include:
(a) A balance sheet that reports the assets, liabilities and net worth of the applicant;
(b) An income statement that reports the revenues and expenses of the applicant;
(c) A statement of cash flow; and
(d) Notes to the financial statement.
(Added to NAC by Comm’r of Insurance, eff. 1-22-86; A 5-27-92; 12-15-94; R152-99, 1-28-2000; R087-17, 6-26-2018)
NAC 683A.115 Evaluation of applicant. (NRS 679B.130, 683A.08524)
1. The Division will, to evaluate the competency and personal and business reputations of an applicant, review the applicant’s past performance in handling, settling and adjudicating claims. The applicant must include with his or her application information in his or her business plan concerning:
(a) The names, experience and qualifications of the members of his or her staff;
(b) A description of the facilities for handling claims, including a description of any computer software used in the process; and
(c) The method used for handling inquiries from claimants.
2. To determine:
(a) An applicant’s or licensee’s ability to administer; and
(b) Whether an applicant is administering claims properly,
Ê the Division will review reports from clients, other agencies of this State and any agency of another state.
3. An applicant who is licensed, certified or otherwise authorized by another state to act as an administrator shall submit to the Division a letter or certificate of good standing from the appropriate agency of that state.
(Added to NAC by Comm’r of Insurance, eff. 1-22-86; A 5-27-92; 12-15-94; R152-99, 1-28-2000)
NAC 683A.119 Determination of whether administrator or applicant is financially unsound. (NRS 679B.130, 683A.08524, 683A.0892) The Commissioner will consider the following to determine whether an administrator or an applicant for a certificate of registration as an administrator is financially unsound pursuant to NRS 683A.08524 or 683A.0892:
1. The administrator or applicant:
(a) Submits a financial statement to the Commissioner, pursuant to NRS 683A.08522 or 683A.08528 or subsection 2 of NAC 683A.105, reporting:
(1) The sum of its assets is less than the sum of its liabilities;
(2) A recurring operating loss;
(3) Negative cash flow from operations; or
(4) A significant decrease in assets within a fiscal year or over a period of years;
(b) Has defaulted on a loan or restructuring of debt;
(c) Has lost key personnel; or
(d) Has experienced an uninsured or underinsured catastrophe.
2. The administrator loses more than 50 percent of its contracts to act as an administrator within a fiscal year.
3. Adverse findings reported in examinations concerning the financial condition of the administrator or applicant that the Commissioner determines to be material.
4. Information and reports concerning the administrator or applicant from the Insurance Regulatory Information System of the National Association of Insurance Commissioners.
5. Whether the portfolio of assets of the administrator or applicant, when considered in light of the current economic conditions, is of sufficient value, liquidity or diversity to ensure the ability of the administrator or applicant to meet its outstanding obligations as those obligations mature.
6. An opinion issued by an independent certified public accountant that the administrator or applicant is unable to operate as a going concern.
(Added to NAC by Comm’r of Insurance by R171-03, eff. 12-16-2003; A by R087-17, 6-26-2018)
NAC 683A.125 Duty to notify Commissioner of certain changes. (NRS 679B.130) An administrator shall notify the Commissioner of any change in:
1. Its members, owners, directors or officers within 30 days after the change. The administrator shall submit a notarized affidavit as described in subsection 6 of NRS 683A.08522 for each new member, owner, director or officer within 30 days after the change.
2. The physical location, mailing address or electronic mail address of an office of the administrator within 30 days after the change.
(Added to NAC by Comm’r of Insurance, eff. 1-22-86; A 11-21-88; 12-15-94; R152-99, 1-28-2000; R087-17, 6-26-2018)
NAC 683A.131 Annual report: Contents of financial statement. (NRS 679B.130, 683A.08528) The financial statement of an administrator submitted pursuant to NRS 683A.08528 must include:
1. A balance sheet that reports the assets, liabilities and net worth of the administrator;
2. An income statement that reports the revenue and expenses of the administrator;
3. A statement of cash flow; and
4. Notes to the financial statement.
(Added to NAC by Comm’r of Insurance by R171-03, eff. 12-16-2003)
NAC 683A.155 Amount of bond; certificate of deposit in lieu of bond. (NRS 679B.130, 683A.0857)
1. Except as otherwise provided in subsection 3, and in addition to the amount prescribed by statute, the amount of the bond for each administrator must be increased as follows for each $1,000,000 of the total amount of money handled by the administrator within this State during an average month:
|
Amount of Money Handled |
Total Amount of Bond |
|
|
|
|
$1,000,000 or less ................................................................... |
$100,000 |
|
More than $1,000,000, but less than $2,000,000..................... |
200,000 |
|
$2,000,000 or more, but less than $3,000,000......................... |
300,000 |
|
$3,000,000 or more, but less than $4,000,000......................... |
400,000 |
|
$4,000,000 or more, but less than $5,000,000......................... |
500,000 |
|
$5,000,000 or more.................................................................. |
10 percent of the amount of money handled, but not more than $1,000,000 |
2. If the Commissioner finds that the increased bonds are unavailable, the Division will accept proof of coverage over $100,000 in the additional amounts specified in subsection 1 under a fidelity policy and a policy which covers the errors and omissions of the administrator or his or her employees. The policies must be reviewed and approved by the Division and provide for notice to the Division 90 days before their cancellation or nonrenewal. Proof of the increases in the bond or the policies of insurance must be furnished to the Division within 30 days after the increase.
3. If an administrator is not authorized to issue a check or draft and only handles claims for the person employing him or her, the administrator is only required to maintain the bond for $100,000.
4. For the purposes of this section, the amount of money handled by the administrator during an average month is the total amount of money handled by the administrator on behalf of contracted entities in connection with his or her activities as an administrator in this State during a fiscal year, divided by 12.
5. An administrator may submit a certificate of deposit from a financial institution in this State that is insured federally, made payable to the Commissioner of Insurance and the administrator, in lieu of the bond required by NRS 683A.0857. The certificate of deposit must:
(a) State that the amount of the deposit is unavailable for withdrawal except upon the signed authorization of the Division; and
(b) Be accompanied by a statement or letter from the issuing financial institution which verifies that:
(1) The requisite amount of money is being held to satisfy the requirement for a deposit; and
(2) The amount of the deposit is unavailable for withdrawal except upon the signed authorization of the Division.
(Added to NAC by Comm’r of Insurance, eff. 1-22-86; A 11-21-88; 5-27-92; 12-15-94; R152-99, 1-28-2000; R075-16, 11-2-2016)
NAC 683A.165 Administrator of self-insurance reserve fund. (NRS 679B.130) An administrator of a self-insurance reserve fund pursuant to paragraph (c) of subsection 1 of NRS 287.010:
1. If it is a corporation, shall submit to the Division to establish that it is a resident of Nevada, evidence that it has:
(a) Its principal place of business in Nevada;
(b) Been qualified to do business in Nevada by the Secretary of State; or
(c) Articles of incorporation which authorize it to transact business in Nevada.
2. Shall keep all books and records relating to the plan in Nevada.
(Added to NAC by Comm’r of Insurance, eff. 1-22-86; A 5-27-92)
PRELICENSING EDUCATION
NAC 683A.170 Exemptions. (NRS 679B.130)
1. NAC 683A.170 to 683A.261, inclusive, do not apply to:
(a) A person applying for a nonresident license.
(b) A person exempted from the requirement of taking the licensing examination by NRS 683A.291.
(c) A person who has been employed by an insurer for at least 10 years and has been actively involved in the underwriting of insurance or settling claims.
(d) A person with at least 10 years’ current experience as a licensed insurance producer. For the purposes of this paragraph, “current” means active employment as a producer of insurance within the last 15 years.
(e) A person who:
(1) Pursuant to NAC 683A.325, is subject to the provisions of NAC 683A.318 to 683A.370, inclusive; and
(2) Successfully completes, within the 12 months immediately preceding his or her application for a license, 30 hours of continuing education in courses approved by the Division pursuant to NAC 683A.318 to 683A.370, inclusive.
(f) A person who has earned and continues to maintain a designation, for the line of authority of:
(1) Life insurance, as a:
(I) Certified employee benefit specialist (CEBS);
(II) Certified financial planner (CFP);
(III) Certified insurance counselor (CIC);
(IV) Chartered financial consultant (ChFC);
(V) Chartered life underwriter (CLU);
(VI) Fellow, life management institute (FLMI); and
(VII) Life underwriter training council fellow (LUTCF);
(2) Accident and health insurance, as a:
(I) Certified employee benefit specialist (CEBS);
(II) Health insurance associate (HIA);
(III) Registered employee benefits consultant (REBC); and
(IV) Registered health underwriter (RHU); and
(3) Casualty insurance, personal lines of insurance or property insurance, as:
(I) An accredited adviser in insurance (AAI);
(II) An associate in risk management (ARM);
(III) A certified insurance counselor (CIC); and
(IV) A chartered property casualty underwriter (CPCU).
2. A person claiming exemption from the requirements of NAC 683A.170 to 683A.261, inclusive, pursuant to:
(a) Paragraph (c) of subsection 1 must submit to the Division:
(1) A written claim of exemption; and
(2) Documentation from the insurer by which the person has been employed indicating that he or she has met the requirements of that paragraph.
(b) Paragraph (d) of subsection 1 must submit to the Division:
(1) A written claim of exemption; and
(2) Documentation from the entity by which the person has been licensed indicating that he or she has met the requirements of that paragraph.
(c) Paragraph (f) of subsection 1 must submit to the Division:
(1) A written claim of exemption; and
(2) Documentation from the entity by which the person has been designated indicating that the person has met the requirements of that paragraph.
(Added to NAC by Comm’r of Insurance, eff. 6-4-86; A 7-22-88, eff. 10-1-88; 2-15-95; R172-01, 7-5-2002; R108-10, 9-14-2012)
NAC 683A.180 Course of instruction required; passing grade. (NRS 679B.130) In addition to the requirements of chapter 683A of NRS, an applicant for a license to act as a producer of insurance or an insurance consultant for:
1. Life insurance, including annuities;
2. Accident and health insurance;
3. Property insurance;
4. Casualty insurance;
5. Personal lines; or
6. Any combination of those types of insurance,
Ê must complete, with a final grade of at least 70 percent, a course of instruction approved by the Commissioner for the line of insurance for which he or she is applying for a license. The course must have been completed within the 2 years immediately preceding the date of the application for the license.
(Added to NAC by Comm’r of Insurance, eff. 6-4-86; A by R152-99, 1-28-2000; R172-01, 7-5-2002)
NAC 683A.190 Approval of course of instruction and instructor. (NRS 679B.130)
1. A course of instruction and the instructor for the course must be approved by the Division before the course is offered to a prospective applicant for a license. The sponsor of the course shall submit to the Division:
(a) An application for approval of the instructor, specifying his or her experience and qualifications;
(b) An application for approval of the course, including a detailed outline of the course and a description of the scale to be used in grading the persons taking the course;
(c) A schedule of the times the course is to be taught; and
(d) A certification that the content of the course complies with NAC 683A.170 to 683A.261, inclusive.
2. The Division shall not approve a course which:
(a) Substantially involves techniques for taking the licensing examination;
(b) Is directed towards teaching techniques of selling, motivation or finding customers;
(c) Is substantially a course to teach clerical skills; or
(d) Does not meet the requirements of NAC 683A.170 to 683A.261, inclusive.
3. No approved course may have more than 8 hours of instruction in the classroom each day.
(Added to NAC by Comm’r of Insurance, eff. 6-4-86; A 5-27-92)
NAC 683A.201 Qualifications of instructor; limitation on instruction by unqualified instructor or mechanical aid. (NRS 679B.130)
1. An instructor must:
(a) Have at least 5 years of relevant experience in the line or lines of insurance which he or she plans to teach; or
(b) Be approved by the Nevada System of Higher Education to teach insurance within that System.
2. No more than one-third of any course approved by the Division may be taught by:
(a) An instructor who does not satisfy the requirements of subsection 1;
(b) Videotapes or audiotapes; or
(c) Any other mechanical teaching aids.
(Added to NAC by Comm’r of Insurance, eff. 6-4-86; A 5-27-92; 2-15-95)
NAC 683A.211 Correspondence, extension or self-study course. (NRS 679B.130)
1. A correspondence, extension or self-study course may be approved by the Division if:
(a) The course satisfies all of the requirements of NAC 683A.170 to 683A.261, inclusive;
(b) The student has quick and easy access to the sponsor or instructor of the course; and
(c) The student must pass a final examination at the end of the course to receive credit and the examination is directly supervised by the sponsor, instructor or his or her representative.
2. The Division shall determine the equivalent number of hours of instruction in the classroom allowed for each approved correspondence, extension or self-study course.
(Added to NAC by Comm’r of Insurance, eff. 6-4-86; A 7-22-88, eff. 10-1-88; 5-27-92; 2-15-95)
NAC 683A.221 Subject matter of courses; hours of instruction. (NRS 679B.130) A course must consist of at least 5 hours of instruction in the classroom, or the equivalent in a self-study course approved by the Division pursuant to NAC 683A.211, in the provisions of title 57 of NRS and the regulations adopted pursuant to those provisions, at least one-half of which must cover the laws and regulations common to all lines of insurance, and:
1. For a course in life insurance, at least 15 hours of instruction in the classroom or the equivalent in a self-study course approved pursuant to NAC 683A.211, covering:
(a) Principles and concepts of insurance in general;
(b) Basic principles and concepts of life insurance;
(c) The contract for life insurance and provisions of the policy;
(d) Classifications and types of life insurance;
(e) Annuities;
(f) The ethical responsibilities of the producer;
(g) The organization of the business of life insurance; and
(h) Regulation by the government.
2. For a course in accident and health insurance, at least 15 hours of instruction in the classroom or the equivalent in a self-study course approved pursuant to NAC 683A.211, covering:
(a) Principles and concepts of insurance in general;
(b) Basic principles and concepts of accident and health insurance;
(c) The contract for accident and health insurance and provisions of the policy;
(d) Accident and health insurance offered by private companies;
(e) Accident and health insurance offered by a governmental entity;
(f) Types of policies and coverage for accident and health insurance;
(g) Group insurance and plans of special insurance;
(h) The ethical responsibilities of the producer; and
(i) Regulation by the government.
3. For a course in property insurance, at least 15 hours of instruction in the classroom or the equivalent in a self-study course approved pursuant to NAC 683A.211, covering:
(a) Principles and concepts of insurance in general;
(b) Basic principles and concepts of property and casualty insurance;
(c) The contract for property insurance and provisions of the policy;
(d) Types of policies and coverage for property insurance;
(e) The ethical responsibilities of the producer;
(f) The organization of the business of property insurance; and
(g) Regulation by the government.
4. For a course in casualty insurance, at least 15 hours of instruction in the classroom or the equivalent in a self-study course approved pursuant to NAC 683A.211, covering:
(a) Principles and concepts of insurance in general;
(b) Basic principles and concepts of property and casualty insurance;
(c) The contract for casualty insurance and provisions of the policy;
(d) Insurance to protect against liability;
(e) Automobile insurance;
(f) Workers’ compensation and employers’ liability insurance;
(g) Fidelity insurance, surety bonds and other types of casualty insurance;
(h) The ethical responsibilities of the producer;
(i) The organization of the business of casualty insurance; and
(j) Regulation by the government.
5. For a course in a combination of life and health insurance or property and casualty insurance, at least 35 hours of instruction in the classroom or the equivalent in a self-study course approved pursuant to NAC 683A.211, covering all the subjects required for each of those separate lines of insurance.
6. For a course in a combination of life and health insurance and property and casualty insurance, at least 75 hours of instruction in the classroom or the equivalent in a self-study course approved pursuant to NAC 683A.211, covering the subjects required for each of those separate lines of insurance.
7. For a course in personal lines insurance, at least 15 hours of instruction in the classroom or the equivalent in a self-study course approved pursuant to NAC 683A.211, covering the subjects of property and casualty dealing with personal lines insurance.
8. For a course in a combination of life and health insurance, property and casualty insurance and personal lines insurance, at least 95 hours of instruction in the classroom or the equivalent in a self-study course approved pursuant to NAC 683A.211, covering the subjects required for each of those separate lines of insurance.
(Added to NAC by Comm’r of Insurance, eff. 6-4-86; A by R172-01, 7-5-2002; R161-08, 9-18-2008)
NAC 683A.225 Course of instruction for bail bonds. (NRS 679B.130) A person who requests approval of the course of instruction for bail bonds required by NRS 697.150, 697.170 or 697.184 must comply with the provisions of NAC 683A.190, 683A.201, 683A.211 and 683A.231 to 683A.261, inclusive.
(Added to NAC by Comm’r of Insurance by R152-99, eff. 1-28-2000)
NAC 683A.231 Records; submission of certain information quarterly; certificate of completion for student. (NRS 679B.130)
1. Each sponsor of a course shall maintain a complete record of each person attending the course. The record must:
(a) Indicate each person’s attendance;
(b) Indicate his or her final grade in the course; and
(c) Be available for review by the Division upon request during normal business hours.
2. Each sponsor shall submit quarterly to the Division for each course offered, the sponsor of the course, the date the course was completed, and the name and grade of each person attending the course. If the course is a self-study course, the sponsor shall also submit the name and description of the course.
3. Each sponsor of a course must give to each person who successfully completes the course an original certificate of completion. The certificate must list the sponsor and instructor of the course, the line of insurance included in the course, the grade obtained by the student in the course, and the location and times the course was offered. An applicant for a license must submit the certificate with his or her application for a license.
(Added to NAC by Comm’r of Insurance, eff. 6-4-86; A 5-27-92; R152-99, 1-28-2000)
NAC 683A.241 Changes in sponsor, instructor or outline of course; suspension and revocation of approval of course. (NRS 679B.130)
1. If the sponsor, instructor or outline of a course changes after approval has been granted, the new sponsor, instructor or outline of the course must be approved by the Division.
2. A person designated by the Division may audit any approved course to ensure that the course, instructor or sponsor continues to meet the requirements of this regulation.
3. If the sponsor, instructor or outline of the course has changed and has not been reapproved, or if the sponsor or instructor is not following the approved outline of the course, the Division may suspend its approval of that course.
4. If the sponsor or instructor has not taken appropriate action to correct the conditions that were the basis of the suspension within 30 days, the Division may revoke its approval of the course.
5. If the sponsor or instructor of an approved course solicits from any person information on the content of the questions on the Division’s licensing examination, the Division may revoke its approval of that instructor or sponsor for at least 1 year.
(Added to NAC by Comm’r of Insurance, eff. 6-4-86; A 5-27-92; R152-99, 1-28-2000)
NAC 683A.251 Submission or issuance of false or fraudulent documents; determination of sponsor or instructor as unsuitable person. (NRS 679B.130)
1. The Commissioner will refuse to license, or will suspend or revoke the license of any person who knowingly submits to the Division a false or fraudulent certificate of completion of education.
2. The Division shall revoke its approval of any sponsor or instructor who knowingly submits or issues a false or fraudulent:
(a) Certificate of completion;
(b) Outline or schedule for a course; or
(c) Application for approval as an instructor or sponsor.
3. The Division shall not reapprove any sponsor or instructor who has had his or her approval revoked pursuant to this section for at least 1 year after the approval of the sponsor or instructor was revoked.
4. The Commissioner may suspend or revoke the approval of any sponsor or instructor who the Commissioner has determined is an unsuitable person.
(Added to NAC by Comm’r of Insurance, eff. 6-4-86; A 5-27-92; R152-99, 1-28-2000)
NAC 683A.261 Forms. (NRS 679B.130) Every application, certificate or other form required to be filed with the Division pursuant to NAC 683A.170 to 683A.261, inclusive, must be on a form furnished by the Division.
(Added to NAC by Comm’r of Insurance, eff. 6-4-86; A 5-27-92)
LICENSING OF PRODUCERS OF INSURANCE AND INSURANCE CONSULTANTS
NAC 683A.270 Required score on examination. (NRS 679B.130, 683A.241, 683C.030) An applicant for a license as a producer of insurance or an insurance consultant who is required to complete an examination for licensure must attain an adjusted score of 80 or more points on the appropriate licensing examination to pass the examination. The examination must have been successfully completed within the 2 years immediately preceding the date of application for the license.
(Added to NAC by Comm’r of Insurance, eff. 3-15-84; A by R172-01, 7-5-2002; R162-08, 9-18-2008)
NAC 683A.272 Search of records of criminal history. (NRS 679B.130, 683A.251)
1. An applicant for a license as a resident producer of insurance must:
(a) Submit with his or her application:
(1) Two complete sets of fingerprints which the Commissioner may forward to the Central Repository for Nevada Records of Criminal History for a search concerning him or her:
(I) Conducted by the Federal Bureau of Investigation in its national criminal records; and
(II) Of the Central Repository for Nevada Records of Criminal History; and
(2) A cashier’s check or money order made payable to the Central Repository for Nevada Records of Criminal History for the applicable fees established by the Records, Communications and Compliance Division of the Department of Public Safety.
(b) Comply with the procedures for obtaining the information required in this subsection that are established by the Records, Communications and Compliance Division of the Department of Public Safety and the Central Repository for Nevada Records of Criminal History in NRS 179A.075 to 179A.160, inclusive.
2. The Commissioner may issue a license as a resident producer of insurance before the criminal background search of the applicant conducted pursuant to subsection 1 is completed if the applicant:
(a) Indicates and certifies on his or her application for a license that he or she has no criminal history; and
(b) Has complied with the procedures required pursuant to subsection 1.
3. The Commissioner may contract with a person outside the Division to process the fingerprints submitted pursuant to subsection 1 so that the fingerprints may be electronically transmitted to the Central Repository for Nevada Records of Criminal History or another law enforcement agency.
(Added to NAC by Comm’r of Insurance by R172-01, eff. 7-5-2002; A by R170-03, 2-12-2004; R163-08, 9-18-2008)
NAC 683A.275 Short-term lessor of passenger vehicles: Licensure requirement; provision for training and supervision of employees; maintenance and availability of records. (NRS 679B.130)
1. A person licensed as a short-term lessor of passenger vehicles pursuant to NRS 482.363 must be licensed as a limited producer pursuant to paragraph (k) of subsection 1 of NRS 683A.261 before engaging in the sale or solicitation of policies of insurance requested by short-term lessees of passenger vehicles.
2. Each short-term lessor of passenger vehicles shall provide training for each employee who will solicit or sell policies of insurance to short-term lessees. The training must include instruction relating to:
(a) The policies of insurance that will be offered for sale to short-term lessees;
(b) Ethical practices concerning the sale of policies of insurance; and
(c) The sales materials and disclosures provided to short-term lessees.
3. The manager of each location of a short-term lessor of passenger vehicles is responsible for the supervision of each employee who solicits or sells policies of insurance at that location.
4. A short-term lessor of passenger vehicles shall maintain the following records for at least 5 years:
(a) A copy of the instructional materials used to train employees pursuant to subsection 2;
(b) A list that includes the name of each manager who is responsible for the supervision of employees pursuant to subsection 3;
(c) A list that includes the name of each employee who is authorized by the short-term lessor to solicit or sell policies of insurance to short-term lessees; and
(d) Proof that each such employee has completed the training required by subsection 2.
5. A short-term lessor of passenger vehicles shall make the records required by subsection 4 available for examination by the Commissioner or a designee thereof upon request.
(Added to NAC by Comm’r of Insurance by R152-99, eff. 1-28-2000; A by R172-01, 7-5-2002)
REGISTRATION OF AGENTS WHO PERFORM UTILIZATION REVIEW
NAC 683A.280 Definitions. (NRS 679B.130) As used in NAC 683A.280 to 683A.295, inclusive:
1. “Agent who performs utilization review” has the meaning ascribed to it in NRS 683A.376.
2. “Insured” has the meaning ascribed to it in NRS 683A.376.
3. “Insurer” includes:
(a) An authorized insurer;
(b) A fraternal benefit society that is certified pursuant to chapter 695A of NRS;
(c) A nonprofit corporation for hospital, medical or dental services that is certified pursuant to chapter 695B of NRS;
(d) A health maintenance organization that is certified pursuant to chapter 695C of NRS; and
(e) An organization for dental care that is certified pursuant to chapter 695D of NRS.
4. “Utilization review” has the meaning ascribed to it in NRS 683A.376.
(Added to NAC by Comm’r of Insurance, eff. 1-24-92)
NAC 683A.285 Registration of insurer; plan for utilization review; insurer to report changes; renewal of registration. (NRS 679B.130, 683A.378)
1. An insurer shall not perform utilization review for another person unless it registers with the Commissioner as an agent who performs utilization review and has a medical director who is a physician or, in the case of an agent who reviews dental services, a dentist, licensed in any state.
2. An insurer may apply for registration by filing with the Commissioner the following information on a form provided by the Commissioner:
(a) The insurer’s name, address, telephone number and normal business hours;
(b) The name and telephone number of a person the Commissioner may contact for information concerning the insurer;
(c) The name of the medical director of the insurer and the state in which he or she is licensed to practice medicine or dentistry; and
(d) A summary of the insurer’s plan for utilization review, including procedures for appealing determinations made through utilization review.
3. An insurer that registers as an agent who performs utilization review shall file with the Commissioner any material changes in the information provided pursuant to subsection 2 within 30 days after the change occurs.
4. The Commissioner will not evaluate the plan submitted pursuant to paragraph (d) of subsection 2. The Commissioner will make the plan available upon request and charge the fee set forth in NAC 683A.295 for providing a copy of the plan.
5. Registration pursuant to this section must be renewed on or before March 1 of each year by providing the information specified in subsection 2.
(Added to NAC by Comm’r of Insurance, eff. 1-24-92; A by R152-99, 1-28-2000)
NAC 683A.290 Employee of registered agent not required to pay certain fees for registration or renewal. (NRS 679B.130, 683A.378) A person employed by a registered agent who performs utilization review is not required to pay the fees for registration or renewal set forth in NRS 683A.378.
(Added to NAC by Comm’r of Insurance, eff. 1-24-92; A by R103-09, 1-28-2010)
NAC 683A.295 Fees for photocopies of plan for utilization review; written request for photocopies required. (NRS 679B.130)
1. The Commissioner will charge the following fees for photocopies of a plan for utilization review filed pursuant to NRS 683A.378 or NAC 683A.285:
(a) If the photocopies are made by the Division, a fee of 50 cents per page, plus postage.
(b) If the photocopies are made at the Division’s offices by the person requesting the copies, a fee of 7 cents per page.
2. A request to make or have made by the Division photocopies of a plan for utilization review must be made in writing to the Division at least 5 days, excluding Saturdays, Sundays and legal holidays, before the photocopies are made.
(Added to NAC by Comm’r of Insurance, eff. 1-24-92)
MISCELLANEOUS PROVISIONS
NAC 683A.310 Payments of premium made after termination of producer’s agreement. (NRS 679B.130) Where the license and agency contract of the original writing producer are terminated, and a mutual agreement between the company and producer is made, the producer may collect and forward future installment premium payments to the company on a net basis.
[Comm’r of Insurance, PC-13, eff. 9-23-72]—(NAC A by R172-01, 7-5-2002)
NAC 683A.315 Sale of annuities by banks: Required disclosures. (NRS 679B.130)
1. A bank licensed by the Commissioner to sell annuities shall disclose to its customers that the annuities sold by the bank:
(a) Are not insured by the Federal Deposit Insurance Corporation;
(b) Are not obligations of the bank;
(c) Are not guaranteed by the bank; and
(d) Involve investment risks, including the possible loss of principal.
2. The disclosure must be:
(a) Printed on or attached to each policy or advertisement for the sale of an annuity which is provided by the bank to its customers; and
(b) Printed in at least 10-point type.
3. A bank which fails to comply with the provisions of this section is subject to disciplinary action by the Commissioner pursuant to NRS 683A.451 to 683A.490, inclusive.
(Added to NAC by Comm’r of Insurance, eff. 12-15-94; A by R172-01, 7-5-2002)
NAC 683A.317 Renewal of appointment of producer of insurance: Verification of records; fee. (NRS 679B.130)
1. Pursuant to subsection 4 of NRS 683A.321, an insurer shall annually renew each appointment of a producer of insurance who acts as his or her agent. An appointment as a producer expires on June 30 of each year beginning June 30, 2002.
2. Before June 30, 2002, each insurer shall verify that the records of the insurer and those of the Division are the same. Verification can be made:
(a) Electronically through a vendor that provides information concerning appointments of producers of insurance; or
(b) By written request to the Division and payment of the appropriate fee.
3. The Division shall send an invoice to each insurer before July 1 of each year for all appointments that are active on the database of the Division as of June 30. The insurer shall return the invoice to the Division with full payment of the requested amount to renew the appointments. Any insurer who disputes the amount of the invoice must file a written complaint with the Division that explains the reason why the insurer disagrees with the fee. The Division will not issue a refund, but the Division may issue a credit, if a discrepancy is the result of an error made by the Division.
(Added to NAC by Comm’r of Insurance, eff. 1-18-96; A by R172-01, 7-5-2002)
CONTINUING EDUCATION
NAC 683A.318 Definitions. (NRS 679B.130) As used in NAC 683A.318 to 683A.370, inclusive, unless the context otherwise requires, the words and terms defined in NAC 683A.320 and 683A.322 have the meanings ascribed to them in those sections.
(Supplied in codification)
NAC 683A.320 “Course” defined. (NRS 679B.130) “Course” includes, but is not limited to, a program of instruction, correspondence course, course of independent study, self-study course or seminar.
(Added to NAC by Comm’r of Insurance, eff. 3-7-90; A 2-15-95; R152-99, 1-28-2000)
NAC 683A.322 “Designated representative” defined. (NRS 679B.130) “Designated representative” means a person with whom the Commissioner contracts pursuant to NAC 683A.327.
(Added to NAC by Comm’r of Insurance by R170-03, eff. 2-12-2004)
NAC 683A.325 Applicability of provisions. (NRS 679B.130)
1. Except as otherwise provided in subsection 2, the provisions of NAC 683A.318 to 683A.370, inclusive, apply to a person who:
(a) Holds a license as a producer of insurance issued pursuant to chapter 683A of NRS or an insurance consultant issued pursuant to chapter 683C of NRS; and
(b) Engages in the business of insurance.
2. The provisions of NAC 683A.318 to 683A.370, inclusive, do not apply to a person who holds:
(a) A limited license issued pursuant to NRS 683A.261; or
(b) A license as a nonresident producer of insurance or a nonresident insurance consultant.
(Added to NAC by Comm’r of Insurance, eff. 3-7-90; A by R172-01, 7-5-2002; R170-3, 2-12-2004)
NAC 683A.327 Designated representative: Authority of Commissioner. (NRS 679B.130) The Commissioner may contract with a person outside the Division to perform all or part of the administrative duties of the continuing education program, subject to the direction and approval of the Commissioner.
(Added to NAC by Comm’r of Insurance by R170-03, eff. 2-12-2004)
NAC 683A.330 Requirements for renewal of license. (NRS 679B.130)
1. Except as otherwise provided in this section, to renew a license as a producer of insurance or an insurance consultant, each licensee must certify that he or she has successfully completed 30 hours of approved continuing education within the 3-year period before the date of renewal. Three of the 30 hours of continuing education must be in the subject of ethics. The hours of continuing education must be related to the line or lines of insurance for which the licensee holds such a license.
2. The Commissioner will exempt a licensee from the requirements for continuing education if the licensee certifies that he or she:
(a) Has earned and continues to maintain his or her designation as a chartered property casualty underwriter (CPCU), chartered life underwriter (CLU), certified insurance counselor (CIC), certified financial planner (CFP) or chartered financial consultant (ChFC); or
(b) Has 20 years of continuous experience and has earned his or her primary source of income in the business of insurance by selling, marketing, underwriting, adjusting, practicing law, managing or regulating, or engaging in any combination of these fields of insurance.
3. The certification required by subsection 1 or 2 must be submitted to the Commissioner in an affidavit approved by the Commissioner.
(Added to NAC by Comm’r of Insurance, 3-7-90, eff. 7-1-90; A 2-15-95; R172-01, 7-5-2002; R164-08, 9-18-2008)
NAC 683A.335 Requirements for approval of courses. (NRS 679B.130)
1. Any person who requests approval for a course for continuing education shall furnish to the Commissioner or to a designated representative thereof at least 60 days before the beginning of the course:
(a) An outline of the subject matter;
(b) The method of presentation;
(c) The qualifications of the instructor;
(d) The number of classroom hours or, if for a correspondence course, a self-study course or an on-line computer course, the equivalent of classroom hours, and a written procedure for conducting a supervised final examination;
(e) Any applicable fees established and required by the Commissioner; and
(f) Any other information required by the Commissioner or a designated representative.
2. Submission of the information required by subsection 1 must be on an application approved by the Commissioner.
3. The course must be designed to increase the knowledge and understanding of the licensee of:
(a) Principles and coverage of insurance;
(b) Applicable laws, rules and regulations concerning insurance;
(c) Recent changes in coverages; and
(d) The duties, ethics and responsibilities of the licensee.
4. The Commissioner or a designated representative will not approve a course that:
(a) Is provided by a producer of insurance or an agency licensed to sell insurance in this State unless the producer of insurance or agency is a trade association of the insurance industry; or
(b) Teaches:
(1) Prelicensing training;
(2) Motivation or psychology;
(3) Marketing;
(4) Prospecting;
(5) Recruiting;
(6) Sales;
(7) Computer applications that are unrelated to insurance;
(8) Skills for communication; or
(9) The management of personnel or of an office.
Ê The provisions of this subsection do not limit the authority of the Commissioner or a designated representative to refuse to approve a course for noncompliance with any other provision of NAC 683A.318 to 683A.370, inclusive.
5. The Commissioner or a designated representative will not approve a course if the total number of classroom hours is less than 1 hour. One hour of credit will be awarded for each 50 minutes of instruction, or the equivalent in self-study approved pursuant to NAC 683A.211.
6. The Commissioner or a designated representative will grant or deny approval of each course in writing within 60 days after receiving the information required pursuant to subsection 1.
7. Any material change in the content of a course approved by the Commissioner or a designated representative must be submitted for approval before presentation of the course.
8. A course that has been approved by the Commissioner or a designated representative is not required to be approved for any subsequent presentation of the course, except that the provider of the course shall submit a notice to the Commissioner or a designated representative, not later than 30 days before the course is offered, that includes the following information:
(a) The name and number of the course;
(b) The name of the instructor of the course;
(c) The place where the course will be offered; and
(d) The date and time when the course will be offered.
(Added to NAC by Comm’r of Insurance, eff. 3-7-90; A 2-15-95; R152-99, 1-28-2000; R172-01, 7-5-2002; R170-03, 2-12-2004)
NAC 683A.337 Requirements for advertisement of courses. (NRS 679B.130)
1. A course of continuing education must not be advertised unless the Commissioner or his or her designated representative has approved the course in writing.
2. Any advertisement of an approved course of continuing education must contain:
(a) The title of the course;
(b) The name and address of the person approved to provide the course;
(c) The lines of insurance for which the course has been approved;
(d) The number of hours of credit for continuing education for which the course has been approved; and
(e) A brief summary or outline of the contents of the course.
(Added to NAC by Comm’r of Insurance, eff. 2-15-95; A by R170-03, 2-12-2004; R165-08, 9-18-2008)
NAC 683A.340 Duties of providers of approved courses. (NRS 679B.130) The provider of a course approved by the Commissioner or a designated representative thereof shall:
1. Give a certificate of completion to each person who successfully completes the course. The certificate must be on a form approved by the Commissioner.
2. Maintain records of attendance and examination scores for 4 years.
3. Make these records and scores available to the Division upon request.
4. Not employ an unsuitable person as an instructor for the course.
(Added to NAC by Comm’r of Insurance, eff. 3-7-90; A by R152-99, 1-28-2000; R170-03, 2-12-2004)
NAC 683A.345 Credit for completion of certain unapproved courses. (NRS 679B.130) A licensee who is seeking approval for hours of continuing education after completing a course organized by and conducted with the supervision of a trade association of the insurance industry or a national association of agents and brokers that was not approved by the Commissioner or a designated representative thereof must:
1. Request approval of the hours from the Commissioner or a designated representative;
2. Submit the information required in subsection 1 of NAC 683A.335; and
3. Submit a document signed by the instructor or provider of the course which verifies the attendance of the licensee and his or her successful completion of each portion of the course for which credit is sought.
(Added to NAC by Comm’r of Insurance, 3-7-90, eff. 7-1-90; A by R170-03, 2-12-2004)
NAC 683A.350 Number of hours approved for certain courses; credit for licensee who attends or teaches course. (NRS 679B.130)
1. The following courses are approved for continuing education for the hours set forth below:
(a) Any of the parts of the life insurance curriculum of the Life Underwriter Training Council, 30 hours for each part.
(b) The health insurance curriculum of the Life Underwriter Training Council, 25 hours.
(c) Any part of the curriculum of the American College, Bryn Mawr, Pennsylvania, leading to the professional designation of Chartered Life Underwriter (CLU), 30 hours for each part.
(d) Any part of the curriculum of the American Institute for Property and Liability Underwriters leading to the professional designation of Chartered Property Casualty Underwriter (CPCU), 30 hours for each part.
(e) Any part of the curriculum of the Life Office Management Association, Atlanta, Georgia, leading to the professional designation of Fellow, Life Management Institute, 30 hours for each part.
(f) Any part of the curriculum of the Insurance Institute of America leading to the designation as an associate in a specialty such as underwriting, management, claims, loss control or auditing, 25 hours for each part.
(g) Any of the parts of the general insurance curriculum of the Insurance Institute of America, 25 hours for each part.
(h) Any part of the curriculum of the College for Financial Planning, Denver, Colorado, leading to the professional designation of Certified Financial Planner, 25 hours for each part.
(i) Any part of the educational program of the Health Insurance Association of America, 15 hours for each part.
(j) Any part of the educational program of the Society of Certified Insurance Counselors, 25 hours for each part.
(k) Any part of the curriculum of the National Association of Health Underwriters, 25 hours for each part.
(l) Any course relating to insurance taught by an accredited college or university, 10 hours for each unit of credit awarded by the college or university.
2. To receive the credit set forth in subsection 1, a licensee must:
(a) Receive a passing grade on the final examination if the course is a self-study course; or
(b) Attend all classes of the course if attendance is required for the course.
3. A licensee who teaches an approved course may receive credit for continuing education for the number of hours that would be granted to a licensee taking and successfully completing the course. A licensee will receive credit in this manner only once during a renewal period for each course taught.
(Added to NAC by Comm’r of Insurance, eff. 3-7-90; A by R152-99, 1-28-2000)
NAC 683A.355 Limitations on receipt and use of credit. (NRS 679B.130) A licensee:
1. May receive credit for continuing education only once during a renewal period for each course taken.
2. May not carry forward to the next renewal period any hours of continuing education that are accumulated during a renewal period in excess of the hours required pursuant to NAC 683A.330.
(Added to NAC by Comm’r of Insurance, eff. 3-7-90)
NAC 683A.360 Verification of continuing education. (NRS 679B.130)
1. Each licensee shall furnish to the Division upon the renewal of his or her license or upon the request of the Division, the original certificate of completion issued by the provider for each course.
2. The licensee shall keep a copy of each certificate of completion for 4 years after the completion of the course.
3. Failure to provide verification of continuing education credits upon request by the Division is evidence that the licensee did not complete the required continuing education.
(Added to NAC by Comm’r of Insurance, 3-7-90, eff. 7-1-90; A 5-27-92; R152-99, 1-28-2000)
NAC 683A.365 Suspension or revocation of approval of course; auditing of course; reinstatement of approval. (NRS 679B.130)
1. The Commissioner or a designated representative thereof may suspend or revoke the approval of a course if he or she determines that:
(a) The content of the course has been changed without notice to the Commissioner or a designated representative and the change affects the number of hours of credit assigned to the course;
(b) A certificate of completion has been issued and hours credited to a person who has not completed the course;
(c) A certificate of completion has not been issued and hours have not been credited when requested to a person who has successfully completed the course;
(d) The quality of instruction is inadequate;
(e) The content of the course does not meet the objectives of subsection 3 of NAC 683A.335;
(f) The provider has not maintained the records required by subsection 2 of NAC 683A.340; or
(g) The provider has employed an unsuitable person as an instructor for the course.
2. The Commissioner or a designated representative may audit a course to ensure that the content or instructor meets the requirements of NAC 683A.335.
3. If approval of a course is suspended or revoked by the Commissioner or a designated representative, approval may be reinstated at the discretion of the Commissioner or a designated representative and after the Commissioner or a designated representative receives proof that the conditions giving rise to the suspension or revocation have been corrected.
(Added to NAC by Comm’r of Insurance, eff. 3-7-90; A 5-27-92; R152-99, 1-28-2000; R170-03, 2-12-2004)
NAC 683A.370 Compliance with requirements; submission of false or fraudulent affidavit. (NRS 679B.130)
1. The Division will not:
(a) Renew the license of a licensee who fails to comply with the requirements of NAC 683A.318 to 683A.370, inclusive; or
(b) Issue any license to a licensee until he or she complies with the requirements of NAC 683A.318 to 683A.370, inclusive.
2. Any person who submits a false or fraudulent affidavit that certifies his or her compliance with the requirements of NAC 683A.318 to 683A.370, inclusive, shall be deemed to have:
(a) Violated a regulation for the purposes of subsection 1 of NRS 683A.451;
(b) Made a material misrepresentation in application for a license for the purposes of subsection 1 or 3 of NRS 683A.451; and
(c) Proven himself or herself untrustworthy for the purposes of subsection 8 of NRS 683A.451.
(Added to NAC by Comm’r of Insurance, 3-7-90, eff. 7-1-90; A 5-27-92; R172-01, 7-5-2002)
FIDUCIARY ACCOUNTS
NAC 683A.390 “Licensee” defined. (NRS 679B.130) As used in NAC 683A.390 to 683A.440, inclusive, “licensee” includes any person licensed by the Commissioner, including producers of insurance, surplus lines brokers, motor club agents, bail bondsmen and administrators.
(Added to NAC by Comm’r of Insurance, eff. 12-3-84; A by R172-01, 7-5-2002)
NAC 683A.400 Authorized types of accounts. (NRS 679B.130, 683A.400) The types of accounts which may be maintained by a person for the deposit of money received pursuant to NRS 683A.400 are:
1. Checking accounts, whether or not they bear interest;
2. Time deposits; and
3. Savings accounts.
(Added to NAC by Comm’r of Insurance, eff. 12-3-84)
NAC 683A.410 Licensee to be named as trustee; signature cards. (NRS 679B.130, 683A.400) The licensee must be named as trustee on accounts maintained pursuant to NRS 683A.400. The signature card for the account must include language which has substantially the same effect as the following:
To: (Name of Bank)
The account referred to on this card and carried by the undersigned with you in the name of John Doe, Trustee, is an account maintained under the provisions of NRS 683A.400. In the event of death of the undersigned, the executor or administrator of his or her estate will be the successor trustee.
(John Doe)
[Comm’r of Insurance, M-2, eff. 5-13-72]—(NAC A 12-3-84)
NAC 683A.420 Formula for determining status of fiduciary account. (NRS 679B.130, 683A.400) The Commissioner will use the following formula to determine the status of a fiduciary account:
1. From the total of the gross accounts receivable from insureds the Commissioner will deduct any uncollected commissions remaining in the accounts receivable then add the total of the deposits in all accounts identified as trust accounts. The Commissioner will use the average rate for commissions to determine the uncollected commissions.
2. The Commissioner will add the net accounts payable to producers of insurance to the sum of all accounts receivable which are more than 90 days old.
3. If the total in subsection 2 is greater than the total in subsection 1, the account has a deficit.
(Added to NAC by Comm’r of Insurance, eff. 12-3-84; A by R172-01, 7-5-2002)
NAC 683A.430 Curing of deficiency. (NRS 679B.130, 683A.400)
1. Any person having a deficit in his or her fiduciary account, as measured pursuant to NAC 683A.420, must cure the deficiency within 5 days after receiving notice of the deficiency from the Commissioner by:
(a) Depositing an amount equal to the deficiency in the trust account; and
(b) Sending a written explanation for the deficiency to the Commissioner.
2. The Commissioner will consider any person who fails to cure a deficiency in the fiduciary account pursuant to subsection 1, to be financially irresponsible pursuant to subsection 8 of NRS 683A.451.
(Added to NAC by Comm’r of Insurance, eff. 12-3-84; A by R172-01, 7-5-2002)
NAC 683A.440 Failure to remit return premium. (NRS 679B.130, 683A.400, 683A.451) The Commissioner will consider any person who fails to remit a return premium to the person to whom it is owed within 30 days after receiving the return premium:
1. To have violated the provisions of NRS 683A.400; and
2. To be financially irresponsible pursuant to subsection 4 of NRS 683A.451.
(Added to NAC by Comm’r of Insurance, eff. 12-3-84; A by R172-01, 7-5-2002)
MANAGING GENERAL AGENTS
NAC 683A.450 Definitions. (NRS 679B.130) As used in NAC 683A.450 to 683A.560, inclusive, unless the context otherwise requires:
1. “Actuary” means a person who is a member in good standing of the American Academy of Actuaries.
2. “Insurer” means a person who holds a certificate of authority in this State pursuant to NRS 680A.060.
3. “Managing general agent” has the meaning ascribed to it in NRS 683A.060.
4. “Underwrite” means the authority to assume or reject risks on behalf of the insurer.
(Added to NAC by Comm’r of Insurance, eff. 9-19-90; A by R172-01, 7-5-2002; R089-17, 5-16-2018)
NAC 683A.460 Licensing and bonding; maintenance of policy for errors and omissions. (NRS 679B.130) A managing general agent:
1. Shall not represent an insurer in this State unless he or she holds a license issued by this State as a producer of insurance.
2. Shall maintain a bond for $50,000 and may maintain a policy that covers any errors and omissions of the managing general agent.
(Added to NAC by Comm’r of Insurance, eff. 9-19-90; A by R172-01, 7-5-2002)
NAC 683A.470 Written contract with insurer. (NRS 679B.130)
1. A managing general agent shall not bind an insurer to a contract of insurance with a third person unless the managing general agent enters into a written contract with the insurer.
2. Such a contract must set forth:
(a) The rights and duties of the insurer and managing general agent and, if a duty is shared by them, the contract must specify the duty each party performs.
(b) The rights and duties set forth in NAC 683A.470 to 683A.530, inclusive.
(c) Guidelines which the managing general agent agrees to follow when underwriting insurance, including:
(1) The maximum annual premium volume of insurance he or she may write;
(2) The rules he or she must follow to establish the rates for the insurance he or she may write;
(3) The types of insurance he or she may write;
(4) The maximum amount of liability per policy which he or she may commit the insurer to assume;
(5) The exclusions from coverage, including any special limits on the coverage he or she writes for the insurer;
(6) The territory in which he or she may write;
(7) The provisions for the cancellation of the insurance; and
(8) The maximum period for which each policy may be written.
(Added to NAC by Comm’r of Insurance, eff. 9-19-90)
NAC 683A.480 Accounts, books and records. (NRS 679B.130) Each managing general agent shall:
1. Submit to the insurer an accounting of each transaction that the managing general agent enters into on behalf of the insurer. The records of each insurer of the managing general agent must be kept separate.
2. Hold in a fiduciary capacity and immediately deposit, in an account set up for the insurer in a bank which is a member of the Federal Reserve System, all money collected on behalf of each insurer.
3. Submit to the insurer all money due to the insurer not less than once each month.
4. Allow the insurer to examine and copy all books, records and accounts pertaining to the insurer in the control of the managing general agent.
5. Allow the Commissioner to examine and copy all books, records and bank accounts of the managing general agent.
6. Keep at his or her principal place of business in this State his or her books, records, documents, accounts and vouchers as required by the provisions of NRS 693A.050 for domestic insurers.
(Added to NAC by Comm’r of Insurance, eff. 9-19-90)
NAC 683A.490 Retention of reserve; assignment of contract with insurer. (NRS 679B.130) A managing general agent shall not:
1. Retain more than 3 months’ reserve for:
(a) An amount estimated to be necessary to pay all of the unpaid claims of the insurer; and
(b) The allocated loss adjustment expenses, in the account set up for the insurer pursuant to the requirements of NAC 683A.480.
2. Assign any part of his or her contract with the insurer required pursuant to NAC 683A.470.
(Added to NAC by Comm’r of Insurance, eff. 9-19-90)
NAC 683A.500 Authority of insurer to terminate contract with agent, suspend agent’s authority, and cancel or refuse to renew policy. (NRS 679B.130) An insurer may:
1. Terminate his or her contract with a managing general agent for cause by written notice to the agent.
2. If the insurer and the managing general agent enter into a dispute regarding the cause for the termination of the agent, suspend the authority of the agent to underwrite insurance for the insurer during the dispute.
3. Cancel or refuse to renew any policy of insurance subject to the provisions of NRS 687B.310 to 687B.410, inclusive.
(Added to NAC by Comm’r of Insurance, eff. 9-19-90)
NAC 683A.510 Handling of claims which agent has authority to settle; suspension and termination of authority to settle claims. (NRS 679B.130) If the contract required pursuant to NAC 683A.470 allows the managing general agent to settle claims on behalf of the insurer:
1. The managing general agent shall:
(a) Report all claims to the insurer in a timely manner; and
(b) Send the insurer a copy of the claim file if the insurer so requests or as soon as the managing general agent knows that the claim:
(1) Has the potential to exceed an amount determined by the Commissioner or exceeds the limit set by the insurer, whichever is less;
(2) Involves a coverage dispute;
(3) May exceed the agent’s authority to settle a claim;
(4) Is open for more than 6 months; or
(5) Is closed by payment of an amount set by the Commissioner or an amount set by the insurer, whichever is less.
2. Except as otherwise provided, all claims files are the joint property of the insurer and managing general agent. Upon an order of liquidation of the insurer, the files become the sole property of the insurer or its estate. The agent may have reasonable access to, and the right to copy the files on a timely basis.
3. The insurer may terminate any settlement authority granted to the agent:
(a) For cause upon the insurer’s written notice to the agent; or
(b) Upon the termination of the contract.
Ê The insurer may suspend the settlement authority during the pendency of any dispute regarding the cause for termination.
4. The contract must address the timely transmission of information if claims are handled electronically.
(Added to NAC by Comm’r of Insurance, eff. 9-19-90)
NAC 683A.520 Sharing of profits between agent and insurer. (NRS 679B.130)
1. If the contract required pursuant to NAC 683A.470, provides for the managing general agent and insurer to share profits and the agent has the authority to determine the amount of the interim profits by establishing loss reserves or controlling claim payments, or in any other manner, the profits must not be paid to the managing general agent until:
(a) One year after they are earned for property insurance business; and
(b) Five years after they are earned on casualty business.
2. The profits must be verified pursuant to NAC 683A.540.
(Added to NAC by Comm’r of Insurance, eff. 9-19-90)
NAC 683A.530 Prohibited acts of agent. (NRS 679B.130) A managing general agent shall not:
1. Commit the insurer to participate in an insurance or reinsurance syndicate.
2. Appoint a producer of insurance who is not licensed by this State as a producer for the type of insurance for which he or she is appointed.
3. Without the prior approval of the insurer:
(a) Pay or commit the insurer to pay a claim over an amount specified by the insurer, net of reinsurance, which exceeds 1 percent of the policyholder’s surplus of the insurer on December 31 of the prior calendar year.
(b) Collect a payment from a reinsurer or commit the insurer to a claim settlement with a reinsurer without the prior approval of the insurer. If the approval is given by the insurer, the managing general agent shall promptly submit a report of the transaction to the insurer.
4. Allow a person who is an agent of the managing general agent to serve on the board of directors of the managing general agent.
5. Employ a person who is an employee of the insurer.
6. Delegate any duty imposed on him or her by the provisions of NAC 683A.470 to 683A.530, inclusive.
7. Bind reinsurance or retrocessions on behalf of the insurer. The managing general agent may bind facultative reinsurance contracts under obligatory facultative agreements if his or her contract with the insurer contains reinsurance underwriting guidelines including, for both reinsurance assumed and ceded:
(a) A list of reinsurers with which such automatic agreements are in effect;
(b) The coverages and amounts or percentages that may be reinsured; and
(c) Schedules for commissions.
(Added to NAC by Comm’r of Insurance, eff. 9-19-90; A by R172-01, 7-5-2002)
NAC 683A.540 Duties of insurers. (NRS 679B.130)
1. The insurer shall file with the Division, in a form approved by the Commissioner, an independent financial examination of each managing general agent with which it has done business.
2. If a managing general agent establishes loss reserves, the insurer shall obtain annually the opinion of an actuary attesting to the adequacy of the loss reserves established for losses incurred and on the outstanding business produced by the managing general agent. This opinion must be made separately from any other required loss reserve certification.
3. The insurer shall, at least once every 6 months, conduct an on-site review of the operations of the managing general agent for underwriting and processing claims.
4. An officer of the insurer, who is not affiliated with the managing general agent, must have binding authority for all reinsurance contracts or for the insurer’s participation in insurance or reinsurance syndicates.
5. Within 30 days after appointing or terminating the contract of a managing general agent, the insurer shall provide written notice to the Commissioner. Notices of appointment of a managing general agent must include a statement of the duties that he or she will perform for the insurer, the lines of insurance for which he or she is to be authorized to act, and any other information requested by the Commissioner.
6. At least once every 3 months, an insurer shall review its books and records to determine if any producer of insurance has become a managing general agent. If the insurer determines that the person has become a managing general agent, the insurer shall promptly notify that person and the Commissioner of the determination. The insurer and the person must comply with the provisions of NAC 683A.470 to 683A.550, inclusive, within 30 days after such a determination by the insurer.
7. An insurer shall not appoint to its board of directors an officer, director, employee or controlling shareholder of its managing general agents. This subsection does not apply to relationships governed by chapter 692C of NRS.
(Added to NAC by Comm’r of Insurance, eff. 9-19-90; A 5-27-92; R172-01, 7-5-2002)
NAC 683A.550 Acts of agent deemed to be acts of insurer; examination of agent. (NRS 679B.130) The acts of the managing general agent are deemed to be the acts of the insurer on whose behalf it is acting. A managing general agent may be examined as if it were the insurer.
(Added to NAC by Comm’r of Insurance, eff. 9-19-90)
NAC 683A.560 Disciplinary action; rights of policyholders, claimants and auditors not restricted. (NRS 679B.130)
1. If the Commissioner finds after a hearing, that a person has violated any provision of NAC 683A.450 to 683A.550, inclusive, the Commissioner will order:
(a) The revocation or suspension of the person’s license; and
(b) The managing general agent to reimburse the insurer, the rehabilitator, or liquidator of the insurer for any losses incurred by the insurer and caused by a violation committed by the managing general agent.
2. The Commissioner will take any other disciplinary action authorized by title 57 of NRS which he or she deems appropriate under the circumstances.
3. NAC 683A.450 to 683A.560, inclusive, are not intended to limit or restrict the rights of policyholders, claimants and auditors.
(Added to NAC by Comm’r of Insurance, eff. 9-19-90)
EXTERNAL REVIEW ORGANIZATIONS
Certification
NAC 683A.600 Application for initial issuance of certificate: Generally. (NRS 679B.130, 683A.3715, 683A.372) Except as otherwise provided in NAC 683A.610, an external review organization applying for the initial issuance of a certificate to conduct external reviews must submit to the Commissioner, on a form prescribed by the Commissioner, an application in writing and must provide to the Commissioner at the time of application:
1. A written statement that identifies:
(a) The number of external reviewers that the external review organization employs, contracts with or otherwise retains to conduct external reviews;
(b) The specialty of each external reviewer;
(c) Whether each external reviewer is certified by the entity that regulates his or her specialty; and
(d) The schedule of fees that the external review organization will charge to conduct an external review.
2. A written summary of the procedures that the external review organization will use to:
(a) Ensure that the external review organization conducts its activities in accordance with NRS 695G.241 to 695G.310, inclusive;
(b) Ensure that an external reviewer employed, contracted with or otherwise retained by the external review organization is qualified to conduct a specific external review;
(c) Ensure that a determination submitted for external review is a final adverse determination;
(d) Ensure that a final review is conducted in a timely manner in accordance with NRS 695G.251, 695G.261 and 695G.271;
(e) Ensure that the external review organization and any employee, agent or contractor of the external review organization does not have a conflict of interest as set forth in subsection 4 of NRS 683A.371; and
(f) Submit a copy of the determination regarding an external review to:
(1) The insured;
(2) The physician of the insured;
(3) The authorized representative of the insured, if any; and
(4) The managed care organization.
3. A written affidavit that:
(a) The information contained in the application and any accompanying materials are complete and correct;
(b) The external review organization will conduct external reviews in accordance with NRS 695G.241 to 695G.310, inclusive;
(c) The external review organization and any employee, agent or contractor of the external review organization will avoid a conflict of interest as set forth in subsection 4 of NRS 683A.371; and
(d) The external review organization is not affiliated with:
(1) A health care plan; or
(2) A national, state or local trade association.
4. All applicable fees required, including, without limitation, all applicable fees required pursuant to NAC 683A.640, for the issuance of a certificate to conduct external reviews.
(Added to NAC by Comm’r of Insurance by R128-03, eff. 2-12-2004; A by R103-09, 1-28-2010)
NAC 683A.610 Application for initial issuance of certificate: Organization certified or accredited by accrediting body that is nationally recognized. (NRS 679B.130, 683A.3715, 683A.372) If an external review organization has been certified or accredited as an external review organization by an accrediting body that is nationally recognized, an external review organization applying for the initial issuance of a certificate to conduct external reviews must submit to the Commissioner, on a form prescribed by the Commissioner, an application in writing and must provide to the Commissioner at the time of application:
1. Proof that the external review organization has been certified or accredited as an external review organization by an accrediting body that is nationally recognized;
2. A copy of the certification or accreditation standards of the accrediting body;
3. A copy of the most recent review of the external review organization conducted by the accrediting body;
4. The schedule of fees that the external review organization will charge to conduct an external review; and
5. All applicable fees required, including, without limitation, all applicable fees required pursuant to NAC 683A.640, for the issuance of a certificate to conduct external reviews.
(Added to NAC by Comm’r of Insurance by R128-03, eff. 2-12-2004; A by R103-09, 1-28-2010)
NAC 683A.620 Issuance of certificate by Commissioner. (NRS 679B.130, 683A.3715, 683A.372) Except as otherwise provided in NAC 683A.650, if an external review organization applying for the initial issuance of a certificate to conduct external reviews submits the application and accompanying materials required pursuant to NAC 683A.600 or 683A.610, the Commissioner will issue the applicant a certificate to conduct external reviews.
(Added to NAC by Comm’r of Insurance by R128-03, eff. 2-12-2004)
NAC 683A.630 Expiration and renewal of certificate. (NRS 679B.130, 683A.3715, 683A.372)
1. In accordance with NRS 683A.371, a certificate to conduct external reviews expires 1 year after the date the certificate is issued by the Commissioner.
2. Except as otherwise provided in NAC 683A.650, the Commissioner will issue a renewal of a certificate to conduct external reviews if the external review organization submits to the Commissioner:
(a) On a form prescribed by the Commissioner, an application in writing for the renewal of the certificate to conduct external reviews; and
(b) All applicable fees required, including, without limitation, all applicable fees required pursuant to NAC 683A.640, for the renewal of a certificate to conduct external reviews.
(Added to NAC by Comm’r of Insurance by R128-03, eff. 2-12-2004; A by R103-09, 1-28-2010)
NAC 683A.640 Fees of Commissioner. (NRS 679B.130, 683A.3715, 683A.372) The Commissioner will charge and collect:
1. Except as otherwise provided in subsection 2, from an external review organization submitting an application for the initial issuance of a certificate to conduct external reviews pursuant to NAC 683A.600 or 683A.610, a fee of $400.
2. From an external review organization submitting an application for:
(a) The initial issuance of a certificate to conduct external reviews pursuant to NAC 683A.600 or 683A.610; and
(b) The initial issuance of a certificate to conduct external reviews pursuant to NRS 616A.469 and 616C.363, and the regulations adopted pursuant thereto,
Ê a fee of $600.
3. From an external review organization submitting an application for the renewal of a certificate to conduct external reviews pursuant to NAC 683A.630, a fee of $100.
4. From an external review organization, all applicable fees required pursuant to NRS 680C.110.
(Added to NAC by Comm’r of Insurance by R128-03, eff. 2-12-2004; A by R103-09, 1-28-2010)
NAC 683A.650 Refusal, suspension or revocation of certification: Grounds; surrender of certificate. (NRS 679B.130, 683A.3715, 683A.372)
1. The Commissioner may refuse to issue or renew, or may suspend or revoke, a certificate to conduct external reviews if the Commissioner determines that an external review organization:
(a) Has violated the provisions of NRS 695G.241 to 695G.310, inclusive, or NAC 683A.600 to 683A.670, inclusive;
(b) Has had a license, certificate or registration to operate as an external review organization denied for cause, suspended or revoked by any other state; or
(c) Has misrepresented facts on an application submitted to the Commissioner for the issuance or renewal of a certificate to conduct external reviews.
2. If the Commissioner refuses to renew, revokes or suspends a certificate to conduct external reviews, the external review organization shall surrender the certificate to the Commissioner.
(Added to NAC by Comm’r of Insurance by R128-03, eff. 2-12-2004)
NAC 683A.660 Duties of organization upon termination of certification or accreditation by accrediting body that is nationally recognized. (NRS 679B.130, 683A.3715, 683A.372) An external review organization issued a certificate to conduct external reviews by the Commissioner pursuant to NAC 683A.610 shall:
1. Notify the Commissioner if the accrediting body revokes, suspends or otherwise terminates the certification or accreditation of the external review organization; and
2. Provide a copy of the findings of any review of the external review organization conducted by the accrediting body.
(Added to NAC by Comm’r of Insurance by R128-03, eff. 2-12-2004)
Conduct of Business
NAC 683A.670 Fees to conduct external reviews. (NRS 679B.130, 683A.3715, 683A.372) The fees an external review organization issued a certificate to conduct external reviews may charge to conduct external reviews must be reasonable.
(Added to NAC by Comm’r of Insurance by R128-03, eff. 2-12-2004)
DUTIES OF BROKERS TO CLIENTS
NAC 683A.700 Definitions. (NRS 679B.130, 686A.015) As used in NAC 683A.700 to 683A.718, inclusive, unless the context otherwise requires, the words and terms defined in NAC 683A.702 to 683A.712, inclusive, have the meanings ascribed to them in those sections.
(Added to NAC by Comm’r of Insurance by R009-05, eff. 10-31-2005)—(Substituted in revision for NAC 686A.352)
NAC 683A.702 “Affiliate” defined. (NRS 679B.130, 686A.015) “Affiliate” means a person that controls, is controlled by, or is under common control with, a broker. As used in this section, “control” has the meaning ascribed to it in NRS 692C.050.
(Added to NAC by Comm’r of Insurance by R009-05, eff. 10-31-2005)—(Substituted in revision for NAC 686A.354)
NAC 683A.704 “Broker” defined. (NRS 679B.130, 686A.015)
1. Except as otherwise provided in subsection 2, “broker” has the meaning ascribed to it in NRS 683A.321.
2. The term does not include a producer of insurance acting as:
(a) An intermediary between an insurer and a client’s broker, including, without limitation, a managing general agent or wholesale broker; or
(b) A reinsurance intermediary. As used in this paragraph, “intermediary” has the meaning ascribed to it in NRS 681A.330.
(Added to NAC by Comm’r of Insurance by R009-05, eff. 10-31-2005)—(Substituted in revision for NAC 686A.356)
NAC 683A.706 “Client” defined. (NRS 679B.130, 686A.015) “Client” means a natural person, corporation, association, partnership or other legal entity that is a named insured or seeks the advice of a broker about becoming an insured or receiving a quotation. The term does not include a person if the person is only:
1. A participant or beneficiary of an employee benefit plan; or
2. Covered by a group or blanket insurance policy or group annuity contract,
Ê that is sold, solicited or negotiated by the broker or affiliate.
(Added to NAC by Comm’r of Insurance by R009-05, eff. 10-31-2005)—(Substituted in revision for NAC 686A.358)
NAC 683A.708 “Compensation” defined. (NRS 679B.130, 686A.015) “Compensation” means consideration in any form for the production of insurance received by a producer of insurance from an insurer or other source.
(Added to NAC by Comm’r of Insurance by R009-05, eff. 10-31-2005)—(Substituted in revision for NAC 686A.360)
NAC 683A.710 “Represents” defined. (NRS 679B.130, 686A.015) “Represents” means to act on behalf of a client in relation to an insurance transaction or potential insurance transaction pursuant to an agreement for compensation.
(Added to NAC by Comm’r of Insurance by R009-05, eff. 10-31-2005)—(Substituted in revision for NAC 686A.362)
NAC 683A.712 “Transaction” defined. (NRS 679B.130, 686A.015) “Transaction” has the meaning ascribed to it in NRS 679A.130. The term includes:
1. The procurement or potential procurement of insurance.
2. The giving of advice concerning matters related to the procurement of insurance, including, without limitation, the nature and type of insurance policies, their coverage, terms, duration, premiums and premium payment arrangements.
(Added to NAC by Comm’r of Insurance by R009-05, eff. 10-31-2005)—(Substituted in revision for NAC 686A.364)
NAC 683A.714 Applicability of duties. (NRS 679B.130, 686A.015) The duties imposed on a broker in NAC 683A.716:
1. Apply to every producer of insurance when acting as a broker.
2. Are in addition to and not in lieu of any other duty imposed on a broker by the Nevada Insurance Code or the common law of agency as recognized in this State.
(Added to NAC by Comm’r of Insurance by R009-05, eff. 10-31-2005)—(Substituted in revision for NAC 686A.366)
NAC 683A.716 Self-dealing; disclosures concerning compensation and certain quotes. (NRS 679B.130, 686A.015) A broker who represents a client in an insurance transaction:
1. Shall not unreasonably place his or her own interest above the interest of the client.
2. Shall, before or simultaneously with a client’s purchase of insurance, or the consummation of any other insurance transaction that would entitle the broker to compensation as a result of his or her representation of the client, disclose to the client:
(a) That the broker may receive compensation in some form from an insurer or other source as a result of his or her representation of the client in the transaction.
(b) The name and identity of the source of the compensation and whether the broker has any ownership interest in, or is under common control with, the person providing the compensation.
(c) That the compensation received by the broker may differ depending upon the product and insurer.
(d) The identity of any other person that the broker knows, or reasonably ought to know, will receive compensation from the insurer for assisting the broker in the insurance transaction. As used in this paragraph, “person” does not include an intermediary, managing general agent or wholesale broker acting in the normal course of production.
Ê These disclosures must be followed by a documented acknowledgment by the client and the broker that clearly indicates the client’s understanding of the contents of the disclosure statement before or simultaneously with the consummation of the insurance transaction. In the case of a transaction consummated over the telephone or by electronic means, the client’s understanding of the disclosure must be documented by the broker at the time of the transaction and followed by a documented acknowledgment by the client and the broker.
3. Shall, before a client’s purchase of insurance, disclose to the client the name of each insurer or other person that supplied the broker with a quote that would reasonably meet the client’s needs.
(Added to NAC by Comm’r of Insurance by R009-05, eff. 10-31-2005)—(Substituted in revision for NAC 686A.368)
NAC 683A.718 Effect of violation. (NRS 679B.130, 686A.015) A violation of any provision of NAC 683A.716 is:
1. An unfair method of competition or an unfair or deceptive act or practice in the business of insurance in violation of NRS 686A.020.
2. A cause for disciplinary action pursuant to NRS 683A.451.
(Added to NAC by Comm’r of Insurance by R009-05, eff. 10-31-2005)—(Substituted in revision for NAC 686A.370)
CONTINUOUS CARE COVERAGE
NAC 683A.750 “Continuous care coverage” defined. (NRS 679B.130) As used in NAC 683A.750 to 683A.780, inclusive, unless the context otherwise requires, “continuous care coverage” has the meaning ascribed to it in NRS 681A.022.
(Added to NAC by Comm’r of Insurance by R077-10, eff. 12-16-2010)
NAC 683A.760 Licensing required to sell, solicit or negotiate continuous care coverage. (NRS 679B.130) A person who sells, solicits or negotiates continuous care coverage must:
1. Be licensed as a producer of accident and health insurance and as a producer of casualty insurance; or
2. Be licensed as a producer of accident and health insurance and receive approval from the Commissioner to market continuous care coverage pursuant to NAC 683A.770.
(Added to NAC by Comm’r of Insurance by R077-10, eff. 12-16-2010)
NAC 683A.770 Instruction required for approval of request to sell, solicit and negotiate continuous care coverage. (NRS 679B.130) A producer of accident and health insurance may submit to the Commissioner a written request to sell, solicit and negotiate continuous care coverage. The Commissioner will approve such a request if, within the 6 months immediately preceding the date on which the request is submitted, the producer has successfully completed not less than 8 hours of instruction approved by the Commissioner for continuous care coverage, including, without limitation, instruction concerning workers’ compensation insurance and employers’ liability insurance.
(Added to NAC by Comm’r of Insurance by R077-10, eff. 12-16-2010)
NAC 683A.780 Instruction counts toward continuing education hours. (NRS 679B.130) The instruction required by NAC 683A.770 may be counted toward the continuing education hours required by NAC 683A.330.
(Added to NAC by Comm’r of Insurance by R077-10, eff. 12-16-2010)