Nev. Admin. Code § 694C.250

Current through November 8, 2024

Section 694C.250 - Reinsurance and excess insurance

1. Except as approved by the Commissioner, a captive insurer shall not:

(a) Enter into any agreement to cede reinsurance;

(b) Enter into any agreement to assume reinsurance; or

(c) Terminate an existing reinsurance treaty, except at its natural expiration as stated within the contract of reinsurance.

2. The effective date of any reinsurance agreement or modification of a reinsurance agreement entered into by a captive insurer may be before or after the date of the Commissioner's approval, except that such effective date must not be before the date on which the captive insurer was initially formed as an insurer domiciled in this State. However, a captive insurer may not enter into or execute a reinsurance agreement before approval by the Commissioner.

3. The Commissioner may require a captive insurer to terminate any reinsurance transaction or prohibit a captive insurer from obtaining any or all reinsurance, if the Commissioner:

(a) Determines that the terms of a particular reinsurance agreement or agreements pose any material risk or disadvantage to the general public; or

(b) Determines that reinsurance is inappropriate when considering the captive insurer's financial condition or the type, nature or volume of business written by the captive insurer.

4. Upon termination or modification of a reinsurance treaty or agreement held by a captive insurer, the Commissioner may order the captive insurer to cease writing any new business until :

(a) The Commissioner approves the modification of the existing reinsurance treaty or agreement, or any replacement reinsurance treaty or agreement obtained by the captive insurer

; or

(b) The captive insurer ceases to utilize any or all reinsurance, if such cessation is determined to be appropriate by the Commissioner.

5. Reinsurance and excess insurance must be effected through a written agreement of reinsurance, or a written contract setting forth the terms, provisions and conditions governing the reinsurance.

6. Complete copies of all reinsurance treaties, agreements and contracts entered into by a captive insurer must be filed by the captive insurer with, and approved by, the Commissioner.

Nev. Admin. Code § 694C.250

Added to NAC by Comm'r of Insurance by R125-99, eff. 1-27-2000; A by R080-16A, eff. 11/2/2016

NRS 679B.130, 694C.170;