Industry Issues | Surplus Lines Reform

Nevada Introduces SB86 on Domestic Surplus Lines Insurer

Legislative Update - Nevada

Nevada Senate Bill 86 has been introduced and referred to the Committee on Commerce and Labor. This is an omnibus bill that makes various changes relating to the regulation of insurers by the Division of Insurance of the Department of Business and Industry. 

Sections 21-26 of this bill would (1) authorize the Commissioner to designate an insurer which is domiciled in this State and meets certain requirements as a domestic surplus lines insurer; and (2) establish certain requirements and limitations on the transaction of the business of insurance by and with, a domestic surplus lines insurer.

Existing law requires certain certificates of licensure, authority or registration which are issued by the Commissioner to be surrendered or delivered to the Commissioner upon expiration, suspension or termination thereof. Sections 78 repeals NRS 683A.480 and is deleted from NRS 685A.220 as it applies to surplus lines brokers (Section 27).

Pursuant to SB86, Section 22, "Domestic surplus lines insurer" means an insurer which is authorized by the Commissioner to accept surplus lines insurance pursuant to section 23 of this act.

Section 23: 
1. An insurer which is domiciled in this State may 15 be designated as a domestic surplus lines insurer by the Commissioner if: 
(a) The insurer possesses capital and surplus of not less than $15,000,000; or
(b) The Commissioner makes an affirmative finding of acceptability pursuant to subsection 3 of NRS 685A.070. 
2. A designation by the Commissioner of an insurer as a domestic surplus lines insurer must be in writing.
3. A domestic surplus lines insurer may accept surplus lines insurance in any jurisdiction in which it is eligible. 
4. A broker who places surplus lines insurance with a domestic surplus lines insurer shall comply with: 
(a) The provisions of NRS 685A.175 and 685A.180; and
(b) All other provisions of this chapter which apply to the export of nonadmitted insurance for an insured for which this State is the home state.
5. Except as otherwise provided by specific statute, the provisions of this Code regarding financial and solvency requirements apply to a domestic surplus lines insurer.
6. The provisions of chapter 686C and 687A of NRS do not apply to a domestic surplus lines insurer.

Section 25:
NRS 685A.0375 is hereby amended to read as follows:
1. "Nonadmitted insurer" means an insurer not authorized to engage in the business of insurance in this State.
2. The term includes a domestic surplus lines insurer.
3. The term does not include a risk retention group as that term is defined in 15 U.S.C. § 3901(a)(4).


Nevada Legislature Passes Senate Bill 67 for Enrollment

On May 27, 2015, the Nevada legislature passed and ordered Senate Bill 67 for enrollment. This omnibus bill, among other things, includes amendment to NRS 680C.110 that eliminates the $1,300 initial and annual fee for the eligible surplus lines insurer. This amendment is in accordance with prior enacted amendment to Nevada surplus lines law (NRS 685A.070) to conform to the federal Nonadmitted and Reinsurance Reform Act of 2010 that limits the requirements for surplus lines eligibility imposed by a state.


Nevada DOI Publishes Bulletin on Nonadmitted Insurance, NRRA Revisions

The Nevada Division of Insurance published Bulletin 13-004, Revisions to NAC Chapter 685A Concerning Non-admitted Insurance. The purpose of the bulletin is to notify surplus-lines brokers, and insureds who independently procure nonadmitted insurance, of changes in Nevada’s regulations that were instituted to conform with federal and Nevada statutes.

It is noted that under Foreign Insurer, the criteria for eligibility does not mention the minimum required capital and surplus.


Nevada Withdraws from Nonadmitted Insurance Multi-State Agreement

On June 29, 2012, Nevada submitted its notice of withdrawal from the Nonadmitted Insurance Multistate Agreement (NIMA). Nevada's membership in NIMA officially terminates on August 29, 2012, or 60 days.

This will leave six participating members in NIMA, including Florida, Louisiana, Puerto Rico, South Dakota, Utah and Wyoming.

According to Nevada DOI Bulletin 12-005, because NV withdrew from NIMA prior to the July 1, 2012, effective date of the NIMA multi-state premium-tax allocation implementation, NV will not be required to participate in such allocation.


Nevada Proposes Nonadmitted Insurance Regulation

Nevada Governor Brian Sandoval has ended a moratorium on new regulations. The Division of Insurance has re-released a proposed regulation relating to nonadmitted insurers. Please review and email any comments or questions to david.kodama@pciaa.net.

LCB File No. R034-12, related to NRS 685A, Senate Bill 289 (2011) - Revises provisions relating to nonadmitted insurers.