686C.250 - Abatement or deferment; maximum amount; effect of insufficiency; allocation of funds among claims.
686C.250 Abatement or deferment; maximum amount; effect of insufficiency; allocation of funds among claims.
1. The Association may abate or defer, in whole or in part, the assessment of a member insurer if, in the opinion of the Board of Directors, payment of the assessment would endanger the ability of the member insurer to fulfill its contractual obligations. If an assessment against a member insurer is abated or deferred in whole or in part, the amount by which that assessment is abated or deferred may be assessed against the other member insurers in a manner consistent with the basis for assessments set forth in this section. As soon as the conditions that caused a deferral have been removed or rectified, the member insurer shall pay all assessments that were deferred pursuant to a plan of repayment approved by the Association.
2. Except as otherwise provided in subsection 3, the total of all assessments authorized by the Association with respect to a member insurer for:
(a) The Account for Life Insurance and Annuities and each of its subaccounts; and
(b) The Account for Health Insurance,
Ê respectively must not in any 1 calendar year exceed 2 percent of the insurer’s average annual premiums received in this state on the policies and contracts covered by the subaccount or account during the 3 calendar years preceding the year in which the insurer became impaired or insolvent.
3. If two or more assessments are authorized in 1 calendar year with respect to insurers that became impaired or insolvent in different calendar years, the average annual premiums received for the purposes of the limitation provided in subsection 2 are equal and limited to the higher of the 3-year annual premiums for the applicable account or subaccount as calculated pursuant to this section.
4. If the maximum assessment, together with the other assets of the Association in an account, does not provide in any 1 year in either account an amount sufficient to carry out the responsibilities of the Association, the necessary additional money must be assessed as soon thereafter as permitted by this chapter.
5. If the maximum assessment for a subaccount of the Account for Life Insurance and Annuities in any 1 year does not provide an amount sufficient to carry out the responsibilities of the Association, then pursuant to subsection 3 of NRS 686C.240, the Board shall assess the other subaccount for the necessary additional amount, subject to the maximum stated in subsection 2.
6. The Board may provide in the plan of operation a method of allocating funds among claims, whether relating to one or more impaired or insolvent insurers, when the maximum assessment is insufficient to cover anticipated claims.
(Added to NRS by 1973, 307; A 1991, 876; 2001, 1042)