692C.210 - Acquisition or merger: Prerequisites for approval; hearing and notice; powers and duties of Commissioner; period for infusion of capital.
692C.210 Acquisition or merger: Prerequisites for approval; hearing and notice; powers and duties of Commissioner; period for infusion of capital.
1. Except as otherwise provided in subsection 5, the Commissioner shall approve any merger or other acquisition of control referred to in NRS 692C.180 unless, after a public hearing thereon, the Commissioner finds that:
(a) After the change of control, the domestic insurer specified in NRS 692C.180 would not be able to satisfy the requirements for the issuance of a license to write the line or lines of insurance for which it is presently licensed;
(b) The effect of the merger or other acquisition of control would be substantially to lessen competition in insurance in this state or tend to create a monopoly;
(c) The financial condition of any acquiring party may jeopardize the financial stability of the insurer, or prejudice the interest of its policyholders or the interests of any remaining security holders who are unaffiliated with the acquiring party;
(d) The terms of the offer, request, invitation, agreement or acquisition referred to in NRS 692C.180 are unfair and unreasonable to the security holders of the insurer;
(e) The plans or proposals which the acquiring party has to liquidate the insurer, sell its assets or consolidate or merge it with any person, or to make any other material change in its business or corporate structure or management, are unfair and unreasonable to policyholders of the insurer or not in the public interest;
(f) The competence, experience and integrity of those persons who would control the operation of the insurer are such that it would not be in the interest of policyholders of the insurer or of the public to permit the merger or other acquisition of control;
(g) If approved, the merger or acquisition of control would likely be harmful or prejudicial to the members of the public who purchase insurance; or
(h) The practices of the applicant in managing claims have evidenced a pattern in which the applicant has knowingly committed, or performed with such frequency as to indicate a general business practice of:
(1) Misrepresentation of pertinent facts or provisions of policies of insurance as they relate to coverages at issue;
(2) Failure to affirm or deny coverage of claims within a reasonable time after written proofs of loss have been furnished; or
(3) Failure to pay claims in a timely manner.
2. The public hearing specified in subsection 1 must be held within 60 days after the statement required by NRS 692C.180 has been filed, and at least 20 days’ notice thereof must be given by the Commissioner to the person filing the statement. Not less than 7 days’ notice of the public hearing must be given by the person filing the statement to the insurer and to any other person designated by the Commissioner. The insurer shall give such notice to its security holders. The Commissioner shall make a determination within 60 days after the conclusion of the hearing. If the Commissioner determines that an infusion of capital to restore capital in connection with the change in control is required, the requirement must be met within 60 days after notification is given of the determination. At the hearing, the person filing the statement, the insurer, any person to whom notice of hearing was sent and any other person whose interests may be affected thereby may present evidence, examine and cross-examine witnesses, and offer oral and written arguments and, in connection therewith, may conduct discovery proceedings in the same manner as is presently allowed in the district court of this state. All discovery proceedings must be concluded not later than 3 days before the commencement of the public hearing.
3. The Commissioner may retain at the acquiring party’s expense attorneys, actuaries, accountants and other experts not otherwise a part of the staff of the Commissioner as may be reasonably necessary to assist the Commissioner in reviewing the proposed acquisition of control.
4. The period for review by the Commissioner must not exceed the 60 days allowed between the filing of the notice of intent to acquire required pursuant to subsection 2 of NRS 692C.180 and the date of the proposed acquisition if the proposed affiliation or change of control involves a financial institution, or an affiliate of a financial institution, and an insured.
5. When making a determination pursuant to paragraph (b) of subsection 1, the Commissioner:
(a) Shall require the submission of the information specified in subsection 2 of NRS 692C.254; and
(b) May condition approval of the merger or acquisition of control in the manner provided in subsection 4 of NRS 692C.258.
6. If, in connection with a change of control of a domestic insurer, the Commissioner determines that the person who is acquiring control of the domestic insurer must maintain or restore the capital of the domestic insurer in an amount that is required by the laws and regulations of this state, the Commissioner shall make the determination not later than 60 days after the notice of intent to acquire required pursuant to subsection 2 of NRS 692C.180 is filed with the Commissioner.
(Added to NRS by 1973, 1042; A 1985, 1070; 1995, 1775; 2001, 2230; 2003, 3323; 2009, 1494)