2005 Nevada Revised Statutes - Chapter 688A — Life Insurance and Annuity Contracts
CHAPTER 688A - LIFE INSURANCE AND ANNUITYCONTRACTS
GENERAL PROVISIONS
NRS 688A.010 Scope.
NRS 688A.020 Annuitydefined.
NRS 688A.030 Industriallife insurance defined.
NRS 688A.040 Standardprovisions required.
NRS 688A.050 Paymentof premiums.
NRS 688A.060 Graceperiod.
NRS 688A.070 Entirecontract.
NRS 688A.080 Incontestability.
NRS 688A.090 Misstatementof age.
NRS 688A.100 Dividends.
NRS 688A.110 Loansecured by policy.
NRS 688A.120 Tableof installments.
NRS 688A.130 Reinstatement.
NRS 688A.140 Paymentof claims.
NRS 688A.150 Beneficiary:Industrial policies.
NRS 688A.160 Title.
NRS 688A.165 Surrenderand request for cancellation of policy.
NRS 688A.170 Excludedor restricted coverage.
NRS 688A.180 Standardprovisions: Annuity and pure endowment contracts.
NRS 688A.190 Annuities:Grace period.
NRS 688A.200 Annuities:Incontestability.
NRS 688A.210 Annuities:Entire contract.
NRS 688A.220 Annuities:Misstatement of age or sex.
NRS 688A.230 Annuities:Dividends.
NRS 688A.240 Annuities:Reinstatement.
NRS 688A.250 Standardprovisions: Reversionary annuities.
NRS 688A.260 Provisionslimiting liability.
NRS 688A.270 Prohibitedprovisions.
NRS 688A.280 Provisionsrequired by law of other jurisdiction.
NRS 688A.281 Qualifiedcharitable-gift annuity: Definitions.
NRS 688A.282 Qualifiedcharitable-gift annuity: Issuance does not constitute transacting insurance.
NRS 688A.283 Qualifiedcharitable-gift annuity: Contents and form of required disclosure.
NRS 688A.284 Qualifiedcharitable-gift annuity: Required notice to Commissioner; contents of notice;further information.
NRS 688A.285 Qualifiedcharitable-gift annuity: Effect of noncompliance; penalties.
STANDARD NONFORFEITURE LAW: LIFE INSURANCE
NRS 688A.290 Shorttitle; applicability; required provisions.
NRS 688A.300 Cashsurrender value: Basic calculations.
NRS 688A.305 Cashsurrender value: Limitations on policies issued on or after January 1, 1987.
NRS 688A.310 Paid-upnonforfeiture benefit.
NRS 688A.315 Reviewof benefits and premiums for life insurance with future premium determination.
NRS 688A.320 Calculationof adjusted premiums for policies issued before operative date of
NRS 688A.325 Calculationof adjusted premiums; operative date of section.
NRS 688A.330 Basisfor calculating adjusted premiums on industrial insurance; applicability ofsection.
NRS 688A.340 Basisfor calculating adjusted premiums and present values on ordinary policiesissued after operative date of this section; election to come under thissection; operative date of this section as to insurer failing to make election.
NRS 688A.350 Calculationof cash surrender value and paid-up nonforfeiture benefit.
NRS 688A.360 Insuranceto which NRS 688A.290 to
NONFORFEITURE LAW: DEFERRED ANNUITIES
NRS 688A.361 Nonforfeitureprovisions required in annuity contracts.
NRS 688A.363 Minimumnonforfeiture amounts.
NRS 688A.3631 Valueof paid-up annuity benefits when benefit payments to commence.
NRS 688A.3633 Valueof cash surrender and death benefits before maturity.
NRS 688A.3635 Valueof paid-up annuity benefits before maturity for contracts not providing cashsurrender or death benefits.
NRS 688A.3637 Maturitydate.
NRS 688A.364 Statementthat policy does not provide cash surrender benefits or death benefits equal tononforfeiture amount.
NRS 688A.366 Calculationof benefits available at time other than contract anniversary.
NRS 688A.367 Minimumnonforfeiture benefits for contracts providing both annuity and life insurancebenefits.
NRS 688A.369 Insuranceto which NRS 688A.361 to
MISCELLANEOUS PROVISIONS
NRS 688A.370 Reinstatement;benefits for disability or accidental death.
NRS 688A.380 Participatingand nonparticipating policies: Accounting; allocations; dividends.
NRS 688A.390 Separateaccounts.
NRS 688A.400 Prohibitedpolicy plans.
NRS 688A.410 Paymentof life insurance proceeds; interest.
NRS 688A.430 Deliveryof group annuity to group formed to purchase annuity prohibited.
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GENERAL PROVISIONS
NRS
(Added to NRS by 1971, 1726)
NRS
(Added to NRS by 1971, 1726)
NRS
(Added to NRS by 1971, 1727)
NRS
1. No policy of life insurance other than pureendowments, with or without return of premiums or of premiums and interest,shall be delivered or issued for delivery in this state unless it contains insubstance all of the applicable provisions required by
2. Any of such provisions or portions thereof notapplicable to single premium or nonparticipating or term policies or insurancegranted in exchange for lapsed or surrendered policies shall to that extent notbe incorporated therein.
(Added to NRS by 1971, 1727)
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(Added to NRS by 1971, 1727)
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(Added to NRS by 1971, 1727)
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(Added to NRS by 1971, 1727)
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(Added to NRS by 1971, 1728)
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(Added to NRS by 1971, 1728)
1. There shall be a provision in participatingpolicies that, beginning not later than the end of the third policy year, theinsurer shall annually ascertain and apportion the divisible surplus, if any,that will accrue on the policy anniversary or other dividend date specified inthe policy, provided the policy is in force and all premiums to that date arepaid. Except as hereinafter provided, any dividend becoming payable shall atthe option of the party entitled to elect such option be either:
(a) Payable in cash; or
(b) Applied to any one of such other dividend optionsas may be provided by the policy. If any such other dividend options areprovided, the policy shall further state which option shall be automaticallyeffective if such party has not elected some other option. If the policyspecifies a period within which such other dividend option may be elected, suchperiod shall be not less than 30 days following the date on which such dividendis due and payable. The annually apportioned dividend shall be deemed to bepayable in cash within the meaning of paragraph (a), even though the policyprovides that payment of such dividend is to be deferred for a specified period,provided such period does not exceed 6 years from the date of apportionment andthat interest will be added to such dividend at a specified rate.
2. Renewable term policies of 10 years or less mayprovide that the surplus accrued to such policies shall be determined andapportioned each year after the second policy year, and accumulated during eachrenewal period, and that at the end of the renewal period, on renewal of thepolicy by the insured, the insurer shall apply the accumulated surplus as anannuity for the next succeeding renewal term in the reduction of premiums.
3. In participating industrial life insurancepolicies, in lieu of the provision required in subsection 1, there shall be aprovision that, beginning not later than the end of the fifth policy year, thepolicy shall participate annually in the divisible surplus, if any, in themanner set forth in the policy.
4. This section does not apply to insurance issuedunder nonforfeiture provisions of lapsed or surrendered policies.
(Added to NRS by 1971, 1728)
NRS
1. There shall be a provision that after 3 full yearspremiums have been paid and after the policy has a cash surrender value andwhile no premium is in default beyond the grace period for payment, the insurerwill advance, on proper assignment or pledge of the policy and on the solesecurity thereof, at a fixed or variable rate of interest as may be approved bythe Commissioner, an amount equal to or, at the option of the party entitledthereto, less than the loan value of the policy. The loan value of the policyshall be at least equal to the cash surrender value at the end of the thencurrent policy year, and the insurer may deduct, either from such loan value orfrom the proceeds of the loan, any existing indebtedness not already deductedin determining such cash surrender value, including any interest then accruedbut not due, any unpaid balance of the premium for the current policy year, andinterest on the loan to the end of the current policy year. The policy may alsoprovide that if interest on any indebtedness is not paid when due it shall thenbe added to the existing indebtedness and shall bear interest at the same rate,and that if and when the total indebtedness on the policy, including interestdue or accrued, equals or exceeds the amount of the loan value thereof, thenthe policy shall terminate and become void, but not until at least 30 daysnotice has been mailed by the insurer to the last address of record with theinsurer, of the insured or other policy owner and of any assignee of record atthe insurers home office. The policy shall reserve to the insurer the right todefer the granting of a loan, other than for the payment of any premium to theinsurer, for 6 months after application therefor. Such provision shall alsocontain a table showing in figures the loan values each year during the first20 years of the policy, or during the term of the policy, whichever is shorter.The policy, at the insurers option, may provide for an automatic premium loan.
2. This section does not apply to term policies, or toterm insurance benefits provided by rider or supplemental policy provisions orto industrial life insurance policies.
(Added to NRS by 1971, 1729; A 1971, 1950)
NRS
(Added to NRS by 1971, 1729)
NRS
1. The policy has been surrendered for its cashsurrender value;
2. Its cash surrender value has been exhausted; or
3. The paid-up term insurance, if any, has expired,
the policywill be reinstated at any time within 3 years after the date of premium defaultupon written application therefor, the production of evidence of insurabilitysatisfactory to the insurer, the payment of all premiums in arrears and anyinterest due thereon and the payment or reinstatement of any other indebtednessto the insurer upon the policy including any interest due thereon.
(Added to NRS by 1971, 1730; A 1985, 1049)
NRS
(Added to NRS by 1971, 1730)
NRS
1. An industrial life insurance policy shall have thename of the beneficiary designated thereon or in the application or other formif attached to the policy, with a reservation of the right to designate or changethe beneficiary after the issuance of the policy, unless such beneficiary isirrevocably designated.
2. The policy may also provide that:
(a) No designation or change of beneficiary shall bebinding on the insurer until endorsed on the policy by the insurer, and thatthe insurer may refuse to endorse the name of any proposed beneficiary who doesnot appear to the insurer to have an insurable interest in the life of theinsured.
(b) If the beneficiary designated in the policy doesnot make a claim under the policy or does not surrender the policy with dueproof of death within the period stated in the policy, which shall not be lessthan 30 days after the death of the insured, or if the beneficiary is theestate of the insured, or is a minor, or dies before the insured, or is notlegally competent to give a valid release, then the insurer may make anypayment thereunder to the executor or administrator of the insured, or to anyrelative of the insured by blood or legal adoption or connection by marriage,or to any person appearing to the insurer to be equitably entitled thereto byreason of having been named beneficiary, or by reason of having incurredexpense for the maintenance, medical attention or burial of the insured.
3. The policy may also include a similar provisionapplicable to any other payment due under the policy.
(Added to NRS by 1971, 1730)
NRS
(Added to NRS by 1971, 1731)
NRS
(Added to NRS by 1977, 455)
NRS
(Added to NRS by 1971, 1731)
NRS
1. No annuity or pure endowment contract, other thanreversionary annuities (also called survivorship annuities) or group annuitiesand except as stated in this section, shall be delivered or issued for deliveryin this state unless it contains in substance each of the provisions specifiedin NRS 688A.190 to
2. This section does not apply to contracts fordeferred annuities included in, or upon the lives of beneficiaries under, lifeinsurance policies.
(Added to NRS by 1971, 1731)
NRS
(Added to NRS by 1971, 1731)
NRS
(Added to NRS by 1971, 1731)
NRS
(Added to NRS by 1971, 1732)
NRS
(Added to NRS by 1971, 1732)
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(Added to NRS by 1971, 1732)
NRS
(Added to NRS by 1971, 1732)
NRS
1. Except as stated in this section, no contract for areversionary annuity shall be delivered or issued for delivery in this stateunless it contains in substance each of the following provisions:
(a) Any such reversionary annuity contract shallcontain the provisions specified in NRS688A.190 to 688A.230, inclusive,except that under NRS 688A.190 the insurermay at its option provide for an equitable reduction of the amount of the annuitypayments in settlement of an overdue payment in lieu of providing for deductionof such payments from an amount payable upon settlement under the contract.
(b) In such reversionary annuity contracts there shallbe a provision that the contract may be reinstated at any time within 3 yearsfrom the date of default in making stipulated payments to the insurer, uponproduction of evidence of insurability satisfactory to the insurer, and uponcondition that all overdue payments and any indebtedness to the insurer onaccount of the contract are paid, or, within the limits permitted by the thencash values of the contract, reinstated, with interest as to both payments andindebtedness at a rate to be specified in the contract but not exceeding 6percent per annum compounded annually.
2. This section does not apply to group annuities orto annuities included in life insurance policies, and any of such provisionsnot applicable to single premium annuities shall not to that extent beincorporated therein.
(Added to NRS by 1971, 1733)
NRS
1. No policy of life insurance shall be delivered orissued for delivery in this state if it contains any of the followingprovisions:
(a) A provision limiting the time within which anaction at law or in equity may be commenced on such a policy to less than 3years after the cause of action has accrued.
(b) A provision which excludes or restricts liabilityfor death caused in a certain specified manner or occurring while the insuredhas a specified status, except that a policy may contain provisions excludingor restricting coverage as specified therein in the event of death under anyone or more of the following circumstances:
(1) Death as a result, directly or indirectly,of war, declared or undeclared, or of action by military forces, or of any actor hazard of such war or action, or of service in the military, naval or airforces or in civilian forces auxiliary thereto, or from any cause while amember of such military, naval or air forces of any country at war, declared orundeclared, or of any country engaged in such military action;
(2) Death as a result of aviation or any airtravel or flight;
(3) Death as a result of a specified hazardousoccupation or occupations or avocation;
(4) Death while the insured is a residentoutside the continental United States of America and Canada; or
(5) Death within 2 years from the date of issueof the policy as a result of suicide, while sane or insane.
2. A policy which contains any exclusion orrestriction pursuant to paragraph (b) shall also provide that in the event ofdeath under the circumstances to which any such exclusion or restriction isapplicable, the insurer will pay an amount not less than a reserve determinedaccording to the Commissioners Reserve Valuation Method upon the basis of themortality table and interest rate specified in the policy for the calculationof nonforfeiture benefits (or if the policy provides for no such benefits,computed according to a mortality table and interest rate determined by theinsurer and specified in the policy) with adjustment for indebtedness ordividend credit.
3. This section does not apply to group lifeinsurance, health insurance, reinsurance or annuities, or to any provision in alife insurance policy or contract supplemental thereto relating to disabilitybenefits or to additional benefits in the event of death by accident oraccidental means.
4. Nothing contained in this section prohibits anyprovision which in the opinion of the Commissioner is more favorable to thepolicyholder than a provision permitted by this section.
(Added to NRS by 1971, 1733)
NRS
1. No life insurance policy, other than industriallife insurance, shall be delivered or issued for delivery in this state, if itcontains any of the following provisions:
(a) A provision by which the policy purports to beissued or to take effect more than 1 year before the original application forthe insurance was made.
(b) A provision for any mode of settlement at maturityof the policy of less value than the amount insured under the policy, plusdividend additions, if any, less any indebtedness to the insurer on or securedby the policy and less any premium that may by the terms of the policy bededucted.
(c) A provision to the effect that the agent solicitingthe insurance is the agent of the person insured under the policy, or makingthe acts or representations of such agent binding upon the person so insuredunder the policy.
2. No policy of industrial life insurance shallcontain any of the following provisions:
(a) A provision by which the insurer may deny liabilityunder the policy for the reason that the insured has previously obtained otherinsurance from the same insurer.
(b) A provision giving the insurer the right to declarethe policy void because the insured has had any disease or ailment, whetherspecified or not, or because the insured has received institutional, hospital,medical or surgical treatment or attention, except a provision which gives theinsurer the right to declare the policy void if the insured has, within 2 yearsprior to the issuance of the policy, received institutional, hospital, medicalor surgical treatment or attention and if the insured or claimant under thepolicy fails to show that the condition occasioning such treatment or attentionwas not of a serious nature or was not material to the risk.
(c) A provision giving the insurer the right to declarethe policy void because the insured has been rejected for insurance, unlesssuch right is conditioned upon a showing by the insurer that knowledge of suchrejection would have led to a refusal by the insurer to make such contract.
(Added to NRS by 1971, 1734)
NRS
(Added to NRS by 1971, 1735)
NRS
1. Charitable-gift annuity means an annuity payableover one or two lives issued by a charitable organization in return for atransfer of money or property by the donor, if the actuarial value of theannuity is less than the value of the money or property transferred and adeduction as a charitable contribution is allowable for purposes of federaltaxes.
2. Charitable organization means an artificialperson described as such in section 501(c)(3) of the Internal Revenue Code of1986, 26 U.S.C. 501(c)(3), or section 170(c) of the Internal Revenue Code of1986, 26 U.S.C. 170(c).
3. Qualified charitable-gift annuity means acharitable-gift annuity described in section 501(m)(5) of the Internal RevenueCode of 1986, 26 U.S.C. 501(m)(5), and section 514(c)(5) of the InternalRevenue Code of 1986, 26 U.S.C. 514(c)(5), which is issued by a charitableorganization that on the date of issuance:
(a) Owns at least $300,000 worth of money, cashequivalents or publicly traded securities, exclusive of the amount transferredto it in return for the annuity; and
(b) Has operated continuously for at least 3 years oris a successor or affiliate of a charitable organization that has operatedcontinuously for at least 3 years.
The termdoes not include an annuity for which any person is paid compensation that iscontingent upon the issuance of the annuity or based upon the value of theannuity other than a payment for reinsurance to an insurer licensed to issueinsurance in this state.
(Added to NRS by
NRS
(Added to NRS by
NRS
(Added to NRS by
NRS
1. A charitable organization that issues qualifiedcharitable-gift annuities shall notify the Commissioner in writing on or beforeDecember 30, 1999, or the expiration of 90 days after it first enters into anagreement to issue a qualified charitable-gift annuity, whichever is later. Thenotice must:
(a) Be signed by an officer or director of theorganization;
(b) Identify the organization; and
(c) Certify that the organization is a charitableorganization and that the annuities are qualified charitable-gift annuities.
2. Unless the Commissioner demands information todetermine the amount of a penalty pursuant to
(Added to NRS by
NRS
1. Failure of a charitable organization to comply withthe requirements of NRS 688A.283 or
2. The Commissioner may demand, by certified mail withreturn receipt requested, that the organization comply with those requirements,and may impose a fine of not more than $1,000 for each charitable-gift annuityissued before compliance is complete.
(Added to NRS by
STANDARD NONFORFEITURE LAW: LIFE INSURANCE
NRS
1. NRS 688A.290to 688A.360, inclusive, shall be knownas the Standard Nonforfeiture Law. Except as provided in
2. In the case of policies issued on or after the dateNRS 688A.290 to
(a) In the event of default in any premium payment, theinsurer will grant, upon proper request made not later than 60 days after thedue date of the premium in default, a paid-up nonforfeiture benefit on a planstipulated in the policy, effective as of such due date, of the amountspecified in NRS 688A.290 to
(b) Upon surrender of the policy within 60 days afterthe due date of any premium payment in default after premiums have been paidfor at least 3 full years in the case of ordinary insurance or 5 full years inthe case of industrial insurance, the insurer will pay, in lieu of any paid-upnonforfeiture benefit, a cash surrender value of the amount specified in
(c) A specified paid-up nonforfeiture benefit mustbecome effective as specified in the policy unless the person entitled to makean election elects another available option not later than 60 days after thedue date of the premium in default.
(d) If the policy has become paid up by completion ofall premium payments or if it is continued under any paid-up nonforfeiturebenefit which became effective on or after the third policy anniversary in thecase of ordinary insurance or the fifth policy anniversary in the case ofindustrial insurance, the insurer will pay, upon surrender of the policy within30 days after any policy anniversary, a cash surrender value of the amountspecified in NRS 688A.290 to
(e) In the case of policies which cause, on a basisguaranteed in the policy, unscheduled changes in benefits or premiums, or whichprovide an option for changes in benefits or premiums other than a change to anew policy, a statement of the mortality table, interest rate, and method usedin calculating cash surrender values and the paid-up nonforfeiture benefitsavailable under the policy. In the case of all other policies, a statement ofthe mortality table and interest rate used in calculating the cash surrendervalues and the paid-up nonforfeiture benefits available under the policy,together with a table showing the cash surrender value, if any, and paid-up nonforfeiturebenefit, if any, available under the policy on each policy anniversary eitherduring the first 20 policy years or during the term of the policy, whichever isshorter. Such values and benefits must be calculated upon the assumption thatthere are no dividends or paid-up additions credited to the policy and thatthere is no indebtedness to the insurer on the policy.
(f) A statement that the cash surrender values and thepaid-up nonforfeiture benefits available under the policy are not less than theminimum values and benefits required by or pursuant to the insurance law of thestate in which the policy is delivered, and an explanation of the manner inwhich the cash surrender values and the paid-up nonforfeiture benefits arealtered by the existence of any paid-up additions credited to the policy or anyindebtedness to the insurer on the policy.
(g) If a detailed statement of the method ofcomputation of the values and benefits shown in the policy is not statedtherein, a statement that the method of computation has been filed with theinsurance supervisory officer of the state in which the policy is delivered.
(h) A statement of the method to be used in calculatingthe cash surrender value and paid-up nonforfeiture benefit available under thepolicy on any policy anniversary beyond the last anniversary for which suchvalues and benefits are consecutively shown in the policy.
3. Any of the provisions required by subsection 2which are not applicable by reason of the plan of insurance may, to the extentinapplicable, be omitted from the policy.
4. Each insurer shall reserve the right to defer thepayment of any cash surrender value for a period of 6 months after demandtherefor with surrender of the policy.
(Added to NRS by 1971, 1735; A 1983, 950)
NRS
1. Any cash surrender value available under the policyin the event of default in a premium payment due on any policy anniversary,whether or not required by NRS 688A.290,must be an amount not less than the excess, if any, of the present value, onthat anniversary, of the future guaranteed benefits which would have been providedfor by the policy, including any existing paid-up additions, if there had beenno default, over the sum of:
(a) The then present value of the adjusted premiums, asdefined in NRS 688A.320 to
(b) The amount of any indebtedness to the insurer onthe policy.
2. For any policy issued on or after the operativedate of NRS 688A.325 which providessupplemental life insurance or annuity benefits at the option of the insuredand for an identifiable additional premium by rider or supplemental policyprovision, the cash surrender value referred to in subsection 1 of this sectionmust be an amount not less than the sum of the cash surrender value for anotherwise similar policy issued at the same age without a rider or supplementalpolicy provision and the cash surrender value for a policy which provides onlythe benefits otherwise provided by a rider or supplemental policy provision.
3. For any family policy issued on or after theoperative date of NRS 688A.325 whichdefines a primary insured and provides term insurance on the life of the spouseof the primary insured expiring before the spouse reaches age 71, the cashsurrender value referred to in subsection 1 must be an amount not less than thesum of the cash surrender value for an otherwise similar policy issued at thesame age without term insurance on the life of the spouse and the cashsurrender value for a policy which provides only the benefits otherwiseprovided by term insurance on the life of the spouse.
4. Any cash surrender value available within 30 daysafter any policy anniversary under any policy paid up by completion of allpremium payments or any policy continued under any paid-up nonforfeiturebenefit, whether or not required by NRS688A.290, must be an amount not less than the present value, on thatanniversary, of the future guaranteed benefits provided for by the policy,including any existing paid-up additions, decreased by any indebtedness to theinsurer on the policy.
(Added to NRS by 1971, 1736; A 1983, 952)
NRS
1. This section applies to all policies issued on orafter January 1, 1987. Any cash surrender value available under the policy inthe event of default in a premium payment due on any policy anniversary must bein an amount which does not differ by more than two-tenths of 1 percent of theamount of insurance, if the insurance is uniform in amount, or the averageamount of insurance at the beginning of each of the first 10 policy years, fromthe sum of:
(a) The greater of zero and the basic cash valuespecified in this section; and
(b) The present value of any existing paid-up additionsless the amount of any indebtedness to the insurer under the policy.
2. The basic cash value must be equal to the presentvalue, on the anniversary, of the future guaranteed benefits which would havebeen provided by the policy, excluding any existing paid-up additions andbefore deduction of any indebtedness to the insurer, if there had been nodefault, less the present value of the nonforfeiture factors, corresponding topremiums which would have fallen due on and after the anniversary. The effectson the basic cash value of supplemental life insurance or annuity benefits orof family coverage, as described in NRS688A.300 or 688A.320, whichever isapplicable, must be the same as the effects specified in
3. The nonforfeiture factor for each policy year mustbe an amount equal to a percentage of the adjusted premium for the policy year,as defined in NRS 688A.320 or
(a) The same for each policy year between the secondpolicy anniversary and the later of:
(1) The fifth policy anniversary; and
(2) The first policy anniversary at which thereis available under the policy a cash surrender value in an amount, beforeincluding any paid-up additions and before deducting any indebtedness, of atleast two-tenths of 1 percent of the amount of insurance, if the insurance isuniform in amount, or the average amount of insurance at the beginning of eachof the first 10 policy years; and
(b) Such that no percentage after the later of the twopolicy anniversaries specified in paragraph (a) may apply to fewer than 5consecutive policy years.
No basiccash value may be less than the value which would be obtained if the adjustedpremiums for the policy, as defined in NRS688A.320 or 688A.325, whichever isapplicable, were substituted for the nonforfeiture factors in the calculationof the basic cash value.
4. All adjusted premiums and present values referredto in this section for a particular policy must be calculated on the samemortality and interest bases as are used in demonstrating the policyscompliance with NRS 688A.290 to
5. Any cash surrender value available other than inthe event of default in a premium payment due on a policy anniversary, and theamount of any paid-up nonforfeiture benefit available under the policy in theevent of default in a premium payment must be determined by methods consistentwith those specified for determining the analogous minimum amounts in
(Added to NRS by 1983, 949)
NRS
(Added to NRS by 1971, 1737; A 1983, 953)
NRS
1. The Commissioner must be satisfied that thebenefits provided under the plan are substantially as favorable topolicyholders and insureds as the minimum benefits otherwise required by
2. The Commissioner must be satisfied that thebenefits and the pattern of premiums of that plan are not such as to misleadprospective policyholders or insureds; and
3. The cash surrender values and paid-up nonforfeiturebenefits provided by the plan must not be less than the minimum values andbenefits required for the plan computed by a method consistent with theprinciples of the Standard Nonforfeiture Law for Life Insurance, as determinedby regulations adopted by the Commissioner.
(Added to NRS by 1983, 948)
NRS
1. Except as provided in subsections 4 and 6, theadjusted premiums for any policy must be calculated on an annual basis and besuch a uniform percentage of the respective premiums specified in the policyfor each policy year, excluding any extra premiums charged because ofimpairments or special hazards, that the present value, at the date of issue ofthe policy, of all such adjusted premiums is equal to the sum of:
(a) The then present value of the future guaranteed benefitsprovided for by the policy;
(b) Two percent of the amount of insurance, if theinsurance is uniform in amount, or of the equivalent uniform amount, as definedin this section, if the amount of insurance varies with duration of the policy;
(c) Forty percent of the adjusted premium for the firstpolicy year; and
(d) Twenty-five percent of either the adjusted premiumfor the first policy year or the adjusted premium for a whole life policy ofthe same uniform or equivalent uniform amount with uniform premiums for thewhole of life issued at the same age for the same amount of insurance,whichever is less.
2. In applying the percentages specified in paragraphs(c) and (d) of subsection 1, no adjusted premium shall be deemed to exceed 4percent of the amount of insurance or uniform amount equivalent thereto. Thedate of issue of a policy for the purpose of this section must be the date asof which the rated age of the insured is determined.
3. In the case of a policy providing an amount ofinsurance varying with duration of the policy, the equivalent uniform amountthereof for the purpose of this section shall be deemed to be the uniformamount of insurance provided by an otherwise similar policy, containing thesame endowment benefit or benefits, if any, issued at the same age and for thesame term, the amount of which does not vary with duration and the benefitsunder which have the same present value at the date of issue as the benefitsunder the policy, except that, in the case of a policy providing a varyingamount of insurance issued on the life of a child under 10 years of age, theequivalent uniform amount may be computed as though the amount of insuranceprovided by the policy before the attainment of age 10 were the amount providedby the policy at age 10.
4. The adjusted premiums for any policy providing terminsurance benefits by rider or supplemental policy provision must be equal to(A) the adjusted premiums for an otherwise similar policy issued at the sameage without term insurance benefits, increased, during the period for whichpremiums for term insurance benefits are payable, by (B) the adjusted premiumsfor such term insurance, the foregoing items (A) and (B) being calculatedseparately and as specified in subsections 1 and 2, except that, for the purposesof paragraphs (b), (c) and (d) of subsection 1, the amount of insurance orequivalent uniform amount of insurance used in the calculation of the adjustedpremiums referred to in (B) must be equal to the excess of the correspondingamount determined for the entire policy over the amount used in the calculationof the adjusted premiums in (A).
5. Except as provided in
6. This section does not apply to policies issued onor after the operative date of NRS688A.325.
(Added to NRS by 1971, 1737; A 1983, 953)
NRS
1. This section applies to all policies issued by aninsurer on or after the operative date of this section as it relates to thatinsurer. Except as otherwise provided in subsection 7, the adjusted premiumsfor any policy must be calculated on an annual basis and be the uniformpercentage of the respective premium specified in the policy for each policyyear, excluding amounts payable as extra premiums to cover impairments orspecial hazards and any uniform annual contract charge or policy fee specifiedin the policy in a statement of the method to be used in calculating the cashsurrender values and paid-up nonforfeiture benefits. The present value, at thedate of issue of the policy, of all adjusted premiums must be equal to the sumof:
(a) The value of the future guaranteed benefitsprovided for by the policy;
(b) One percent of the amount of insurance, if theinsurance is uniform in amount, or the average amount of insurance at thebeginning of each of the first 10 policy years; and
(c) One hundred twenty-five percent of thenonforfeiture net level premium. In applying the percentage specified inparagraph (c), no nonforfeiture net level premium may be deemed to exceed 4percent of the amount of insurance, if the insurance is uniform in amount, orthe average amount of insurance at the beginning of each of the first 10 policyyears. The date of issue of a policy for the purpose of this section must bethe date as of which the rated age of the insured is determined.
2. The nonforfeiture net level premium must be equalto the present value, at the date of issue of the policy, of the guaranteedbenefits provided for by the policy divided by the present value, at the dateof issue of the policy, of an annuity of one per annum payable on the date ofissue of the policy and on each anniversary of the policy on which a premiumfalls due.
3. In the case of policies which cause unscheduledchanges in benefits or premiums on a basis guaranteed in the policy, or whichprovide an option for changes in benefits or premiums other than a change to anew policy, the adjusted premiums and present values must initially becalculated on the assumption that future benefits and premiums do not changefrom those stipulated at the date of issue of the policy. At the time of anychange in the benefits or premiums, the future adjusted premiums, nonforfeiturenet level premiums and present values must be recalculated on the assumptionthat future benefits and premiums do not change from those stipulated by thepolicy immediately after the change.
4. Except as otherwise provided in subsection 7, therecalculated future adjusted premiums for any such policy must be a uniformpercentage of the respective future premiums specified in the policy for eachpolicy year, excluding amounts payable as extra premiums to cover impairmentsand special hazards and any uniform annual contract charge or policy feespecified in the policy in a statement of the method to be used in calculatingthe cash surrender values and paid-up nonforfeiture benefits, which results inthe present value, at the time of change to the newly defined benefits orpremiums, of all future adjusted premiums being equal to the excess of the sumof the present value of the future guaranteed benefits provided for by thepolicy and the additional expense allowance, if any, over the cash surrendervalue, if any, or present value of any paid-up nonforfeiture benefit under thepolicy.
5. The additional expense allowance, at the time ofthe change to the newly defined benefits or premiums, must be the sum of:
(a) One percent of the excess, if positive, of theaverage amount of insurance at the beginning of each of the first 10 policyyears after the change, over the average amount of insurance before the changeat the beginning of each of the first 10 policy years after the most recentprevious change, or, if there has been no previous change, the date of issue ofthe policy; and
(b) One hundred twenty-five percent of the increase, ifpositive, in the nonforfeiture net level premium.
6. The recalculated nonforfeiture net level premiummust be equal to the result obtained by dividing amount A by amount Bwhere:
(a) A equals the sum of:
(1) The nonforfeiture net level premiumapplicable before the change, multiplied by the present value of an annuity ofone per annum payable on each anniversary of the policy on or after the date ofthe change on which a premium would have fallen due if the change had notoccurred; and
(2) The present value of the increase in futureguaranteed benefits provided for by the policy.
(b) B equals the present value of an annuity of oneper annum payable on each anniversary of the policy on or after the date ofchange on which a premium falls due.
7. In the case of a policy issued on a substandardbasis which provides reduced graded amounts of insurance so that, in eachpolicy year, the policy has the same tabular mortality cost as an otherwisesimilar policy issued on the standard basis which provides higher uniformamounts of insurance, adjusted premiums and present values for the substandardpolicy may be calculated as if it were issued to provide the higher uniformamounts of insurance on the standard basis.
8. All adjusted premiums and present values referredto in NRS 688A.290 to
(a) At the option of the insurer, calculations for allpolicies issued in a particular calendar year may be made on the basis of arate of interest not exceeding the nonforfeiture interest rate, established inthis section, for policies issued in the immediately preceding calendar year.
(b) Under any paid-up nonforfeiture benefit, includingany paid-up dividend additions, any cash surrender value available, whether ornot required by NRS 688A.290, must becalculated on the basis of the mortality table and rate of interest used indetermining the amount of the paid-up nonforfeiture benefit and paid-updividend additions, if any.
(c) An insurer may calculate the amount of anyguaranteed paid-up nonforfeiture benefit including any paid-up additions underthe policy on the basis of an interest rate which is not lower than thatspecified in the policy for calculating cash surrender values.
(d) In calculating the present value of any paid-upterm insurance with accompanying pure endowment, if any, offered as anonforfeiture benefit, the rates of mortality assumed may be not more thanthose shown in the Commissioners 1980 Extended Term Insurance Table forpolicies of ordinary insurance and not more than the Commissioners 1961Industrial Extended Term Insurance Table for policies of industrial insurance.
(e) For insurance issued on a substandard basis or aspecial underwriting basis, the calculation of any adjusted premiums andpresent values may be based on appropriate modifications of the tablesspecified in this subsection.
(f) Any ordinary mortality tables which are adoptedafter 1980 by the National Association of Insurance Commissioners and areapproved by a regulation adopted by the Commissioner for use in determining theminimum nonforfeiture standard may be substituted for the Commissioners 1980Standard Ordinary Mortality Table with or without Ten-Year Select MortalityFactors or for the Commissioners 1980 Extended Term Insurance Table.
(g) Any industrial mortality tables which are adoptedafter 1980 by the National Association of Insurance Commissioners and areapproved by a regulation adopted by the Commissioner for use in determining theminimum nonforfeiture standard may be substituted for the Commissioners 1961Standard Industrial Mortality Table or the Commissioners 1961 IndustrialExtended Term Insurance Table.
9. The nonforfeiture interest rate for any policyissued in a particular calendar year must be equal to 125 percent of the calendaryear statutory valuation interest rate for the policy as defined in theStandard Valuation Law, rounded to the nearer one-fourth of 1 percent.
10. Any refiling of nonforfeiture values or theirmethods of computation for any previously approved policy form which involvesonly a change in the interest rate or mortality table used to computenonforfeiture values does not require refiling of any other provisions of thatpolicy form.
11. After July 1, 1983, any insurer may file with theCommissioner a written notice of its election to comply with the provision ofthis section after a specified date before January 1, 1989. A date so specifiedis the operative date of this section for that insurer. If an insurer makes noelection, the operative date of this section for that insurer is January 1,1989.
(Added to NRS by 1983, 945; A 1995, 1625)
NRS
1. In the case of industrial policies issued on orafter the operative date of this section, as provided in subsection 2, alladjusted premiums and present values referred to in
(a) In calculating the present value of any paid-upterm insurance with accompanying pure endowment, if any, offered as anonforfeiture benefit, the rates of mortality assumed may be not more thanthose shown in the Commissioners 1961 Industrial Extended Term Insurance Table.
(b) For insurance issued on a substandard basis or aspecial underwriting basis, the calculations of any such adjusted premiums andpresent values may be based on such other table of mortality as may bespecified by the insurer and approved by the Commissioner.
2. After July 1, 1963, any insurer may file with theCommissioner a written notice of its election to comply with the provisions ofthis section after a specified date before January 1, 1968. After the filing ofa notice, upon the specified date, this section is operative with respect tothe industrial policies thereafter issued by the insurer. If an insurer makesno such election, the operative date of this section for the insurer is January1, 1968.
3. This section does not apply to policies issued onor after the operative date of NRS688A.325.
(Added to NRS by 1971, 1738; A 1973, 723; 1977, 691;1983, 954; 1995, 1627)
NRS
1. In the case of ordinary policies issued on or afterthe operative date of this section, all adjusted premiums and present valuesreferred to in NRS 688A.290 to
(a) For any category of ordinary insurance issued onfemale risks, adjusted premiums and present values may be calculated accordingto an age not more than 6 years younger than the actual age of the insured.
(b) In calculating the present value of any paid-upterm insurance with accompanying pure endowment, if any, offered as a nonforfeiturebenefit, the rates of mortality assumed may be not more than those shown in theCommissioners 1958 Extended Term Insurance Table.
(c) The calculation of adjusted premiums and presentvalues for insurance issued on a substandard basis may be based on such othertable of mortality as may be specified by the insurer and approved by theCommissioner.
2. Any insurer may file with the Commissioner awritten notice of its election to comply with the provisions of this sectionafter a specified date before January 1, 1966. After the filing of the notice,this section becomes operative upon the specified date with respect to theordinary policies thereafter issued by the insurer.
3. If an insurer makes no such election, the operativedate of this section for the insurer is January 1, 1966.
4. This section does not apply to ordinary policiesissued on or after the operative date of NRS688A.325.
(Added to NRS by 1971, 1739; A 1973, 723; 1977, 692;1983, 955)
NRS
1. Any cash surrender value and any paid-upnonforfeiture benefit, available under the policy in the event of default in apremium payment due at any time other than on the policy anniversary, must becalculated with allowance for the lapse of time and the payment of fractionalpremiums beyond the last preceding policy anniversary.
2. All values referred to in
3. The net value of any paid-up additions, other thanpaid-up term additions, must not be less than the amounts used to provide theadditions.
4. Notwithstanding the provisions of
(a) In the event of death or dismemberment by accidentor accidental means;
(b) In the event of total and permanent disability;
(c) As reversionary annuity or deferred reversionaryannuity benefits;
(d) As term insurance benefits provided by a rider orsupplemental policy provision to which, if issued as a separate policy,
(e) As term insurance on the life of a child or on thelives of children provided in a policy on the life of a parent of the child, ifthe term insurance expires before the childs age is 26, is uniform in amountafter the childs age is 1, and has not become paid up by reason of the deathof a parent of the child;
(f) As other policy benefits additional to lifeinsurance and endowment benefits; and
(g) Premiums for all such additional benefits,
must bedisregarded in ascertaining cash surrender values and nonforfeiture benefitsrequired by NRS 688A.290 to
(Added to NRS by 1971, 1740; A 1983, 956)
NRS
1. Reinsurance, group insurance, pure endowment,annuity or reversionary annuity contract.
2. Term policy of uniform amount which provides noguaranteed nonforfeiture or endowment benefits, or the renewal thereof, of 20years or less expiring before age 71, for which uniform premiums are payableduring the entire term of the policy.
3. Term policy of decreasing amount which provides noguaranteed nonforfeiture or endowment benefits on which each adjusted premium,calculated as specified in NRS 688A.320to 688A.340, inclusive, is less thanthe adjusted premium, calculated in the same manner, on a term policy ofuniform amount, or a renewal thereof, which provides no guaranteednonforfeiture or endowment benefits, issued at the same age and for the sameinitial amount of insurance and for a term of 20 years or less, expiring beforeage 71, for which uniform premiums are payable during the entire term of thepolicy.
4. Policy which provides no guaranteed nonforfeitureor endowment benefits, for which no cash surrender value, if any, or presentvalue of any paid-up nonforfeiture benefit, at the beginning of any policyyear, calculated as specified in NRS688A.300 to 688A.340, inclusive,exceeds 2.5 percent of the amount of insurance at the beginning of the samepolicy year.
5. Policy which is delivered outside this state by anagent or other representative of the company issuing the policy.
For purposesof determining whether NRS 688A.290 to688A.360, inclusive, apply, the age atexpiration for a joint term policy of life insurance is the age of the oldest personat the time of expiration.
(Added to NRS by 1971, 1740; A 1983, 957)
NONFORFEITURE LAW: DEFERRED ANNUITIES
NRS
1. A statement that upon cessation of payment ofconsiderations under a contract, or upon receipt of a written request submittedby an owner of a contract, the company will grant a paid-up annuity benefit ona plan stipulated in the contract of such value as is specified in
2. If a contract provides for a lump-sum settlement atmaturity or any other time, a statement that upon surrender of the contract ator before the commencement of any annuity payments, the company will pay inlieu of any paid-up annuity benefit a cash surrender benefit of an amountspecified in NRS 688A.3631,
3. A statement of the mortality table, if any, and interestrates used in calculating any minimum paid-up annuity, cash surrender or deathbenefits which are guaranteed under the contract, together with sufficientinformation to determine the amounts of those benefits; and
4. A statement that any paid-up annuity, cashsurrender or death benefits which may be available under the contract are notless than the minimum benefits required by any statute of the state in whichthe contract is delivered and an explanation of the manner in which suchbenefits are altered by the existence of any additional amounts credited by thecompany to the contract, any indebtedness to the company on the contract or anyprior withdrawals from or partial surrenders of the contract,
except thatany deferred annuity contract may provide that if no considerations have beenreceived under a contract for a period of 2 full years, and the portion of thepaid-up annuity benefit at maturity on the plan stipulated in the contractarising from considerations paid before that period would be less than $20monthly, the company may terminate the contract by payment in cash of the thenpresent value of such portion of the paid-up annuity benefit, calculated on thebasis of the mortality table, if any, and interest rate specified in the contractfor determining the paid-up annuity benefit, and by such payment shall berelieved of any further obligation under the contract.
(Added to NRS by 1977, 688; A 1979, 86;
NRS
1. The minimum values, specified in
2. With respect to contracts providing for flexibleconsiderations, the minimum nonforfeiture amount for any time at or before thecommencement of any annuity payments is equal to an accumulation up to suchtime at a rate of interest calculated pursuant to subsection 3, which must bedecreased by the sum of:
(a) Any prior withdrawals from or partial surrenders ofthe contract, accumulated at a rate of interest calculated pursuant tosubsection 3;
(b) An annual charge in the amount of $50, accumulatedat rates of interest calculated pursuant to subsection 3;
(c) Any premium tax paid by the company for thecontract, accumulated at rates of interest calculated pursuant to subsection 3;and
(d) The amount of any indebtedness to the company on thecontract, including interest due and accrued.
The netconsiderations for a given contract year used to define the minimum nonforfeitureamount must be an amount that is equal to 87.5 percent of the gross considerationscredited to the contract during that contract year.
3. For the purpose of this section, the rate ofinterest used to determine the minimum nonforfeiture amounts must be an annualrate of interest determined as the lesser of 3 percent per annum or a ratespecified in the contract if the rate is calculated in accordance withregulations adopted by the Commissioner, except that at no time may theresulting rate be less than 1 percent per annum.
(Added to NRS by 1977, 688; A
NRS
(Added to NRS by 1977, 689)
NRS
(Added to NRS by 1977, 689)
NRS
(Added to NRS by 1977, 690)
NRS
(Added to NRS by 1977, 690)
NRS
(Added to NRS by 1977, 690)
NRS
(Added to NRS by 1977, 690)
NRS
1. In the event of total and permanent disability;
2. As reversionary annuity or deferred reversionaryannuity benefits; or
3. As other policy benefits additional to lifeinsurance, endowment and annuity benefits,
andconsiderations for all such additional benefits shall be disregarded in ascertainingthe minimum nonforfeiture amounts, paid-up annuity, cash surrender and deathbenefits which may be required by NRS688A.361 to 688A.369, inclusive.The inclusion of such additional benefits shall not be required in any paid-upbenefits, unless the additional benefits separately would require minimumnonforfeiture amounts, paid-up annuity, cash surrender and death benefits.
(Added to NRS by 1977, 690)
NRS
(Added to NRS by 1977, 687)
MISCELLANEOUS PROVISIONS
NRS
1. A reinstated policy of life insurance or an annuitycontract may be contested on account of fraud or misrepresentation of factsmaterial to the reinstatement only for the same period following reinstatementand with the same conditions and exceptions as the policy provides with respectto contestability after original issuance.
2. When any life insurance policy or annuity contractis reinstated such reinstated policy or contract may exclude or restrictliability to the same extent that such liability could have been or wasexcluded or restricted when the policy or contract was originally issued, andsuch exclusion or restriction shall be effective from the date ofreinstatement.
3. After 3 years from the date of issue of a lifeinsurance policy or of a supplemental contract thereto providing total andpermanent disability benefits or additional benefits in the event of death byaccident or accidental means, no misstatements, except fraudulentmisstatements, made by the applicant in the application for the policy shall beused to deny a claim for such total and permanent disability commencing, or forsuch additional benefits in the event of death by accident or accidental meansoccurring, after the expiration of such 3-year period. This subsection shallnot be so construed as to preclude the assertion at any time of defenses basedupon provisions with respect to such benefits which exclude or restrict coverage.
(Added to NRS by 1971, 1741)
NRS
1. A life insurer issuing both participating andnonparticipating policies shall maintain such accounting records as arenecessary for it to determine dividends to participating policyholders on anequitable basis.
2. For the purposes of such accounting records theinsurer shall make a reasonable allocation between participating andnonparticipating policies of the expenses of such general operations orfunctions as are jointly shared. Any allocation of expense between therespective categories shall be made upon a reasonable basis, to the end thateach category shall bear a just portion of joint expense involved in the administrationof the business of such category.
3. No policy after January 1, 1972, shall provide for,and no life insurer or representative shall, after January 1, 1972, knowinglyoffer or promise payment, credit or distribution of participating dividends,earnings, profits or savings, by whatever name called, to participatingpolicies out of such profits, earnings or savings on nonparticipating policies.This subsection does not restrict the generality of
(Added to NRS by 1971, 1741)
NRS
1. A domestic life insurer may establish one or moreseparate accounts, and may allocate thereto amounts (including withoutlimitation proceeds applied under optional modes of settlement or underdividend options) to provide for life insurance or annuities (and benefitsincidental thereto), payable in fixed or variable amounts or both, subject tothe following:
(a) The income, gains and losses, realized orunrealized, from assets allocated to a separate account shall be credited to orcharged against the account, without regard to other income, gains or losses ofthe company.
(b) Except as may be provided with respect to reservesfor guaranteed benefits and funds referred to in paragraph (c):
(1) Amounts allocated to any separate accountand accumulations thereon may be invested and reinvested without regard to anyrequirements or limitations prescribed by the laws of this state governing theinvestments of life insurance companies; and
(2) The investments in such separate account oraccounts shall not be taken into account in applying the investment limitationsotherwise applicable to the investments of the company.
(c) Except with the approval of the Commissioner andunder such conditions as to investments and other matters as he may prescribe,which shall recognize the guaranteed nature of the benefits provided, reservesfor:
(1) Benefits guaranteed as to dollar amount andduration; and
(2) Funds guaranteed as to principal amount orstated rate of interest,
shall not bemaintained in a separate account.
(d) Unless otherwise approved by the Commissioner,assets allocated to a separate account shall be valued at their market value onthe date of valuation, or if there is no readily available market, then asprovided under the terms of the contract or the rules or other writtenagreement applicable to such separate account; but unless otherwise approved bythe Commissioner, the portion if any of the assets of such separate accountequal to the companys reserve liability with regard to the guaranteed benefitsand funds referred to in paragraph (c) shall be valued in accordance with therules otherwise applicable to the companys assets.
(e) Amounts allocated to a separate account in theexercise of the power granted by this section shall be owned by the company,and the company shall not be, nor hold itself out to be, a trustee with respectto such amounts. If and to the extent so provided under the applicable contracts,that portion of the assets of any such separate account equal to the reservesand other contract liabilities with respect to such account shall not bechargeable with liabilities arising out of any other business the company mayconduct.
(f) No sale, exchange or other transfer of assets maybe made by a company between any of its separate accounts or between any otherinvestment account and one or more of its separate accounts unless, in case ofa transfer into a separate account, such transfer is made solely to establishthe account pursuant to subsection 6 or to support the operation of thecontracts with respect to the separate account to which the transfer is made,and unless such transfer, whether into or from a separate account, is made:
(1) By a transfer of cash; or
(2) By a transfer of securities having a readilydeterminable market value, provided that such transfer of securities isapproved by the Commissioner.
TheCommissioner may approve other transfers among such accounts if, in hisopinion, such transfers would not be inequitable.
(g) To the extent such company deems it necessary tocomply with any applicable federal or state laws, such company, with respect toany separate account, including without limitation any separate account whichis a management investment company or a unit investment trust, may provide forpersons having an interest therein appropriate voting and other rights andspecial procedures for the conduct of the business of such account, includingwithout limitation special rights and procedures relating to investment policy,investment advisory services, selection of independent public accountants andthe selection of a committee, the members of which need not be otherwiseaffiliated with such company, to manage the business of such account.
2. Any contract providing benefits payable in variableamounts delivered or issued for delivery in this state, including a groupcontract and any certificate issued thereunder, shall contain a statement ofthe essential features of the procedures to be followed by the insurancecompany in determining the dollar amount of such variable benefits. Any suchcontract under which the benefits vary to reflect investment experience,including a group contract and any certificate in evidence of variable benefitsissued thereunder, shall state that such dollar amount will so vary and shallcontain on its first page a statement to the effect that the benefitsthereunder are on a variable basis.
3. No company shall deliver or issue for deliverywithin this state variable contracts unless it is licensed or organized to do alife insurance or annuity business in this state, and the Commissioner issatisfied that its condition or method of operation in connection with theissuance of such contracts will not render its operation hazardous to thepublic or its policyholders in this state. In this connection, the Commissionershall consider among other things:
(a) The history and financial condition of the company;
(b) The character, responsibility and fitness of theofficers and directors of the company; and
(c) The law and regulations under which the company isauthorized in the state of domicile to issue variable contracts.
If thecompany is a subsidiary of an admitted life insurance company, or affiliatedwith such company through common management or ownership, it may be deemed bythe Commissioner to have met the provisions of this subsection if either it orthe parent or the affiliated company meets the requirements hereof.
4. Notwithstanding any other provision of law, theCommissioner has sole authority to regulate the issuance and sale of variablecontracts, and to issue such reasonable rules and regulations as may beappropriate to carry out the purposes and provisions of this section.
5. Except for NRS688A.190, 688A.240 and
6. A domestic life insurer which establishes one ormore separate accounts pursuant to this section may participate therein byallocating and contributing to such separate account funds which otherwisemight be invested pursuant to subsection 1 of
(a) One hundred thousand dollars;
(b) One percent of its admitted assets as of December31 next preceding; or
(c) Five percent of its surplus as to policyholders asof December 31 next preceding.
All funds allocatedor contributed by the insurer to a separate account for the purpose ofparticipation therein shall be included in applying the limitations upon investmentsotherwise specified in this Code. The insurer shall be entitled to withdraw atany time in whole or in part its participation in any separate account to whichfunds have been allocated or contributed and to receive upon withdrawal itsproportional share of the value of the assets of the separate account at thetime of withdrawal.
(Added to NRS by 1971, 1742; A 1971, 1951)
NRS
1. No life insurer shall, after January 1, 1972,deliver or issue for delivery in this state:
(a) As part of or in combination with any lifeinsurance, endowment or annuity contract, any agreement or plan, additional tothe rights, dividends and benefits arising out of any such contract, whichprovides for the accumulation of profits over a period of years and for paymentof all or any part of such accumulated profits only to members or policyholdersof a designated group or class who continue as members or policyholders untilthe end of a specified or ascertainable period of years.
(b) Any registered policy; that is, any policy (otherthan one registered as a security under applicable state or federal law)purporting to be registered or otherwise specially recorded, with any agencyof the State of Nevada, or of any other state, or with any bank, trust company,escrow company or other institution other than the insurer, or purporting thatany reserves, assets or deposits are held, or will be so held, for the specialbenefit or protection of the holder of such policy, by or through any suchagency or institution.
(c) Any policy or contract under which any part of thepremium or of funds or values arising from the policy or contract or frominvestment of reserves, or from mortality savings, lapses or surrenders, inexcess of the normal reserves or amounts required to pay death, endowment andnonforfeiture benefits in respective amounts as specified in or pursuant to thepolicy or contract, are on a basis not involving insurance or life contingencyfeatures:
(1) To be placed in special funds or segregatedaccounts or specially designated places; or
(2) To be invested in specially designatedinvestments or types thereof,
and thefunds or earnings thereon to be divided among the holders of such policies orcontracts, or their beneficiaries or assignees. This paragraph does not applyto any contract authorized under NRS688A.390.
(d) Any policy providing for the segregation ofpolicyholders into mathematical groups and providing benefits for a survivingpolicyholder arising out of the death of another policyholder of such group, orunder any other similar plan.
(e) Any policy providing benefits or values forsurviving or continuing policyholders contingent upon the lapse or terminationof the policies of other policyholders, whether by death or otherwise.
(f) Any policy providing that on the death of anyonenot specifically named therein, the owner or beneficiary of the policy shallreceive the payment or granting of anything of value. This provision shall notbe deemed to prohibit family policies insuring unspecified members of a family,nor be deemed to prohibit payment to unspecified beneficiaries of a class whichhas been expressly designated as such by the insured or policy owner.
(g) Any policy containing or referring to one or moreof the following provisions or statements:
(1) Investment returns or profit sharing, otherthan as a participation in the divisible surplus of the insurer under a regularparticipation provision as provided for in NRS688A.100.
(2) Special treatment in the determination ofany dividend that may be paid as to such policy.
(3) Reference to premiums as deposits.
(4) Relating policyholder interest or returns tothose of stockholders.
(5) That the policyholder as a member of aselect group will be entitled to extra benefits or extra dividends notavailable to policyholders generally.
2. This section does not prohibit the provision,payment, allowance or apportionment of regular dividends or savings underregular participating forms of policies or contracts.
(Added to NRS by 1971, 1744)
NRS
(Added to NRS by 1977, 626)
NRS
(Added to NRS by 1985, 1059)
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