CORPORATE POWERS AND PROCEDURES OF DOMESTIC STOCK AND MUTUAL INSURERS

Nev. Rev. Stat. 693A

in effect

Nev. Rev. Stat. § 693A.010 Scope.

1. Except as provided in subsection 2, this chapter applies only to domestic stock insurers and domestic mutual insurers. 2. Subsection 3 of NRS 693A.050 also applies to foreign and alien insurers whose principal United States offices are located in this state; and subsection 5 of NRS 693A.250 applies to the issuance of nonassessable policies by foreign mutual insurers.

Nev. Rev. Stat. § 693A.020 Applicability of statutes relating to corporations.

Domestic stock and mutual insurers shall be governed by the applicable provisions of the general statutes of this state relating to private corporations as such statutes are constituted on January 1, 1972, or may thereafter be constituted, except where such general statutes are in conflict with the express provisions of this Code and the reasonable implications of such provisions, in which case the provisions of this Code shall govern.

Nev. Rev. Stat. § 693A.030 Domestic insurer prohibited from engaging in other business; exceptions.

1. Except as otherwise provided in subsections 2, 3 and 4, a domestic insurer formed before, on or after January 1, 1972, shall not engage in any business other than the insurance business and in business activities reasonably and necessarily incidental to the insurance business. 2. A title insurer may also engage in business as an escrow agent. 3. Any insurer may also engage in business activities reasonably related to the management, supervision, servicing of and protection of its interests as to its lawful investments, and to the full utilization of its facilities. 4. An insurer may own subsidiaries which may engage in such businesses as are provided for in NRS 682A.430 .

Nev. Rev. Stat. § 693A.040 Principal offices.

1. Except as provided in subsection 2, every domestic insurer shall have and maintain its principal office and principal place of business in this state. 2. The Commissioner for good cause shown may permit an insurer to have and maintain such office or place of business in another state if found by the Commissioner to be in the best interests of the insurer and its policyholders and reasonably convenient to the Commissioner in his or her supervision of the insurer, all subject to such reasonable terms and conditions as the Commissioner shall, by order granting such permission, establish.

Nev. Rev. Stat. § 693A.050 Books, records, documents, accounts and vouchers.

1. Every domestic insurer shall keep at its principal place of business its books, records, documents, accounts and vouchers in such a manner that its financial condition can be ascertained and that its financial statements filed with the Commissioner can readily be verified and its compliance with the law determined. 2. No insurer shall make any disbursement of $25 or more, unless evidenced by a voucher or other document correctly describing the consideration for the payment and supported by a check or receipt endorsed or signed by or on behalf of the person receiving the money. If the disbursement is for services and reimbursement, the voucher or other document, or some other writing referred to therein, shall describe the services and itemize the expenditures. If the disbursement is in connection with any matter pending before any Legislature or public body or before any public officer, the voucher or other document shall also correctly describe the nature of the matter and the nature of the insurers interest therein. 3. All such books, records, documents, accounts and vouchers of a domestic insurer, or of any principal United States office of a foreign or alien insurer located in this State, shall be preserved and kept available for the purposes of examination and until authority to destroy or otherwise dispose of such records is secured from the Commissioner. 4. Any director, officer, agent or employee of any insurer who destroys any such books, records or documents without the authority of the Commissioner in violation of this section is guilty of a gross misdemeanor.

Nev. Rev. Stat. § 693A.060 Assets to be kept in State; exception.

1. Every domestic insurer shall keep its assets within the State of Nevada, except where requisite for the normal transaction of its business. 2. This section does not apply to: (a) Assets maintained at the insurers principal place of business located outside this State with the Commissioners permission granted under NRS 693A.040 ; (b) Securities on deposit with or through the insurance supervisory officer of another state, province or country as a condition to authority for the transaction of insurance business by the insurer in that state, province or country; and (c) Negotiable securities held in book entry form through the United States banking system and recorded in the name of the domestic insurer or its nominee by the authorized transfer agency or trustee of the security.

Nev. Rev. Stat. § 693A.070 Removal or concealment of records or assets; penalty.

1. A person shall not remove all or any material part of the records or assets of a domestic insurer from this State except pursuant to a plan of merger, consolidation or bulk reinsurance approved by the Commissioner under this Code, or for such other reasonable purposes and periods of time as may be permissible under NRS 693A.050 and 693A.060 , or as may have been approved by the Commissioner in writing in advance of such removal. 2. A person shall not conceal any such records or assets from the Commissioner. 3. A person who unlawfully removes or attempts to remove such records or assets or such material part thereof from the principal place of business of the insurer or place of safekeeping thereof, or who unlawfully conceals or attempts to conceal the same from the Commissioner, is guilty of a category D felony and shall be punished as provided in NRS 193.130 . 4. Upon any unlawful removal or attempted removal of such records or assets, or upon retention of such records or assets or material part thereof outside this State in violation of the terms of the applicable consent of the Commissioner, or upon any unlawful concealment of or attempt to conceal records or assets, the Commissioner may, in the discretion of the Commissioner, institute delinquency proceedings against the insurer pursuant to chapter 696B of NRS (conservation, rehabilitation and liquidation).

Nev. Rev. Stat. § 693A.080 Information to stockholders and regulation of proxies: Scope of provisions; rules and regulations.

1. This section and NRS 693A.090 and 693A.100 apply to all domestic stock insurers except: (a) A domestic stock insurer having of record less than 100 holders of any class of equity securities; but if 95 percent or more of the insurers equity securities are owned or controlled by a parent or an affiliated insurer, this section and NRS 693A.090 and 693A.100 do not apply to such insurer unless its remaining securities are held of record by 500 or more persons; and (b) Domestic stock insurers which, relative to the voting or other securities involved, file with the Securities and Exchange Commission forms of proxies, consents and authorizations pursuant to the Securities Exchange Act of 1934, as amended. 2. The Commissioner shall have authority to make and promulgate reasonable rules and regulations for the effectuation of this section and NRS 693A.090 and 693A.100 , and in so doing shall give due consideration to rules and regulations promulgated for similar purposes by the insurance supervisory officers of other states.

Nev. Rev. Stat. § 693A.090 Information to stockholders and regulation of proxies: Information in advance of meetings.

Every insurer to which this section and NRS 693A.080 and 693A.100 apply shall seasonably furnish to its stockholders, in advance of stockholder meetings, information in writing reasonably adequate to inform them relative to all matters to be presented by the insurers management for consideration of stockholders at such meeting.

Nev. Rev. Stat. § 693A.100 Information to stockholders and regulation of proxies: Solicitation and form of proxies.

1. No person shall solicit a proxy, consent or authorization in respect of any stock or other voting security of such an insurer unless he or she furnishes the person so solicited with written information reasonably adequate as to: (a) The material matters in regard to which the powers so solicited are proposed to be used; and (b) The person or persons on whose behalf the solicitation is made, and the interest of such person or persons in relation to such matters. 2. No person shall so furnish to another information which the informer knows or has reason to believe is false or misleading as to any material fact, or which fails to state any material fact reasonably necessary to prevent any other statement made from being misleading. 3. The form of all such proxies shall: (a) Conspicuously state on whose behalf the proxy is solicited; (b) Provide for dating the proxy; (c) Impartially identify each matter or group of related matters intended to be acted upon; (d) Provide means for the principal to instruct the vote of the shares of the principal as to approval or disapproval of each matter or group, other than election to office; and (e) Be legibly printed, with context suitably organized, Ê but a proxy may confer discretionary authority as to matters as to which a choice is not specified pursuant to paragraph (d), if the form conspicuously states how it is intended to vote the proxy or authorization in each such case, and may confer discretionary authority as to other matters which may come before the meeting but unknown for a reasonable time prior to the solicitation by the persons on whose behalf the solicitation is made. 4. No proxy shall confer authority to: (a) Vote for the election of any person to any office for which a bona fide nominee is not named in the proxy statement; or (b) Vote in any annual meeting (or adjournment thereof) other than the annual meeting next following the date on which the proxy statement and form were furnished stockholders. 5. Any proxy, consent or authorization obtained in violation of, or which violates, this section or the lawful rules and regulations of the Commissioner relating thereto is void.

Nev. Rev. Stat. § 693A.110 Management and agency contracts; regulations.

1. After January 1, 1972, a domestic insurer shall not make any contract whereby any person is granted or is to enjoy in fact the management of the insurer to the material exclusion of its board of directors or to have the controlling or preemptive right to produce substantially all insurance business for the insurer, or, if an officer, director or otherwise part of the insurers management, is to receive any commission, bonus or compensation based upon the volume of the insurers business or transactions, unless the contract is filed with and not disapproved by the Commissioner. The contract must become effective in accordance with its terms unless disapproved by the Commissioner within 20 days after the date of filing, subject to such reasonable extension of time as the Commissioner may require by notice given within such 20 days. Any disapproval must be delivered to the insurer in writing stating the grounds therefor. 2. Any such contract must provide that any such manager, producer of its business or contract holder shall within 90 days after expiration of each calendar year furnish the insurers board of directors a written statement of amounts received under or on account of the contract and amounts expended thereunder during the previous calendar year, with specification of the emoluments received therefrom by the respective directors, officers and other principal management personnel of the manager or producer, and with such classification of items and further detail as the insurers board of directors may reasonably require. 3. The Commissioner shall disapprove any such contract if the Commissioner finds that it: (a) Subjects the insurer to excessive charges; (b) Is to extend for an unreasonable length of time; (c) Does not contain fair and adequate standards of performance; or (d) Contains other inequitable provision or provisions which impair the proper interests of stockholders or members of the insurer. 4. The Commissioner may, after a hearing held thereon, disapprove any such contract theretofore permitted to become effective, if the Commissioner finds that the contract should be disapproved on any of the grounds specified in subsection 3. 5. This section does not apply to contracts entered into before January 1, 1972, or to extensions or amendments of such contracts. 6. The Commissioner may adopt regulations governing the management and agency contracts of insurers.

Nev. Rev. Stat. § 693A.120 Prohibited pecuniary interest of officers; regulations.

1. Any officer or director, or any member of any committee or an employee of a domestic insurer, having the duty or power of investing or handling the insurers funds, shall not: (a) Deposit or invest such funds except in the insurers name; (b) Borrow the fund of the insurer, or be pecuniarily interested in any loan, pledge, deposit, security, investment, sale, purchase, exchange, reinsurance or other similar transaction or property of the insurer except as a stockholder, member, employee or director, unless the transaction is authorized or approved by the insurers board of directors, with the knowledge and recording of such pecuniary interest, by an affirmative vote of not less than two-thirds of the directors; and (c) Take or receive to his or her own use any fee, brokerage, commission, gift or other similar consideration for or on account of any such transaction made by or on behalf of the insurer. 2. No insurer shall guarantee the financial obligation of any of its officers or directors. 3. This section does not prohibit: (a) Such a director, officer, member of a committee or employee from becoming a policyholder of the insurer and enjoying the usual rights of a policyholder or from participating as beneficiary in any pension trust, deferred compensation plan, profit-sharing plan, stock option plan or similar plan authorized by the insurer and to which he or she may be eligible; or (b) Any director or member of a committee from receiving a reasonable fee for lawful services actually rendered to the insurer. 4. The Commissioner may, by regulation from time to time, define and permit additional exceptions to the prohibitions contained in subsection 1 solely to enable payment of reasonable compensation to a director who is not otherwise an officer or employee of the insurer, or to a corporation or firm in which a director is interested, for necessary services performed or sales or purchases made to or for the insurer in the ordinary course of the insurers business and in the usual private, professional or business capacity of such director, corporation or firm.

Nev. Rev. Stat. § 693A.130 Liability of officers and others for paying taxes, licenses and fees.

No director, trustee, officer or agent of any insurer shall be subject to personal liability by reason of any payment or any determination not to contest or seek recovery of any payment made subsequent to June 4, 1944, by or on behalf of such insurer on account of any tax, license, fee, deposit or other charge paid pursuant to the terms of any statute, law or ordinance of this or any other state, county, city or taxing authority, unless prior to such payment or determination such statute, law or ordinance has been expressly held invalid by the state court having final appellate jurisdiction in the premises or by the Supreme Court of the United States.

Nev. Rev. Stat. § 693A.140 Dividends to stockholders.

1. A domestic stock insurer shall not pay any cash dividend to stockholders except out of that part of its available and accumulated surplus money otherwise unrestricted and derived from realized net operating profits and realized and unrealized capital gains. 2. A stock dividend may be paid out of any available surplus. Upon payment of such a dividend the insurer shall transfer to its paid-in capital stock accounts money equal to the aggregate of the par values of the shares so distributed. 3. A domestic stock insurer may declare and distribute a dividend otherwise prohibited by this section if: (a) Following the payment of the dividend, the insurers surplus as regards policyholders is reasonable in relation to its outstanding liabilities and adequate to its financial needs, as determined pursuant to NRS 692C.370 ; and (b) The Commissioner approves the dividend before its payment.

Nev. Rev. Stat. § 693A.150 Participating policies.

1. If provided for in its articles of incorporation or charter, a stock insurer or mutual insurer may: (a) Issue any or all of its policies or contracts with or without participation in profits, savings, unabsorbed portions of premiums or surplus; (b) Classify policies issued and perils insured on a participating and nonparticipating basis; and (c) Determine the right to participate and the extent of participation of any class or classes of policies. Ê Any such classification or determination shall be reasonable, and shall not unfairly discriminate as between policies so classified. 2. A life insurer may issue both participating and nonparticipating policies or contracts if the right or absence of the right to participate is reasonably related to the premium charged. 3. After the first policy year, no dividend, otherwise earned, shall be made contingent upon the payment of the renewal premium on any policy or contract; but a participating life or health insurance policy providing for participation at the end of the first or second policy year or the first and second policy year may provide that such dividend or dividends will be paid subject to payment of the premium for the next ensuing year.

Nev. Rev. Stat. § 693A.160 Dividends to policyholders.

1. The directors of a domestic mutual insurer may from time to time apportion and pay or credit to its members dividends only out of that part of its surplus funds which represents net realized savings, net realized earnings and net realized capital gains, all in excess of the surplus required by law to be maintained by the insurer. 2. Subject to NRS 688A.380 (participating, nonparticipating policies; accounting, allocations, dividends), a domestic stock insurer may pay dividends to holders of its participating policies out of its available surplus. 3. No such dividend shall be paid which is inequitable, or which unfairly discriminates between classifications of policies or policies within the same classification.

Nev. Rev. Stat. § 693A.170 Purchase of own shares by stock insurer.

A domestic insurer shall have the right to purchase or acquire shares of its own stock only as follows: 1. For elimination of fractional shares. 2. Incidental to the enforcement of rights of the insurer with respect to lawful transactions previously entered into in good faith for purposes other than the acquisition of such shares. 3. For the purposes of a general savings and investment plan for employees of the insurer. 4. For mutualization of the insurer, as provided in NRS 693A.290 . 5. For purposes as stated under a plan for such acquisition submitted to and approved in writing by the Commissioner. The Commissioner shall not approve a plan unless found by the Commissioner to be for proper purposes, to be reasonable, fair and equitable as to the remaining stockholders of the insurer, and not materially adverse to the protection of the insurers policyholders. 6. As the result of a gift or bequest of the shares to the insurer. 7. By call for redemption and cancellation of a callable class of stock in accordance with provisions of the insurers articles of incorporation.

Nev. Rev. Stat. § 693A.180 Borrowing.

1. A domestic stock or mutual insurer may without pledge of assets borrow money to defray expenses of its organization, provide surplus funds or for any purpose of its business, upon a written agreement that such money is required to be repaid only out of the insurers surplus in excess of that stipulated in such agreement. The agreement may provide for interest not exceeding 6 percent per annum, which interest shall or shall not constitute a liability of the insurer as to its funds other than such excess of surplus, as stipulated in the agreement. No commission or promotion expense shall be paid in connection with any such loan, except that if a public offering and sale is made of the loan securities the insurer may pay the reasonable costs thereof approved by the Commissioner. 2. Money so borrowed, together with the interest thereon if so stipulated in the agreement, shall not form a part of the insurers legal liabilities except as to its surplus in excess of the amount thereof stipulated in the agreement, or be the basis of any setoff; but until repaid, financial statements filed or published by the insurer shall show as a footnote thereto the amount thereof then unpaid together with any interest thereon accrued but unpaid. 3. Any such loan shall be subject to the Commissioners approval. The insurer shall, in advance of the loan, file with the Commissioner a statement of the purpose of the loan and a copy of the proposed loan agreement. The loan and agreement shall be deemed approved unless within 15 days after the date of such filing the insurer is notified of the Commissioners disapproval and the reasons therefor. The Commissioner shall disapprove any proposed loan or agreement if the Commissioner finds the loan is unnecessary or excessive for the purpose intended, or that the terms of the loan agreement are not fair and equitable to the parties and to other similar lenders, if any, to the insurer, or that the information so filed by the insurer is inadequate. 4. Any such loan to a mutual insurer or substantial portion thereof shall be repaid by the insurer when no longer reasonably necessary for the purpose originally intended. No repayment of such a loan shall be made by a mutual insurer unless approved in advance by the Commissioner. 5. This section does not apply to other kinds of loans obtained by the insurer in the ordinary course of business, or to loans secured by a pledge or mortgage of assets.

Nev. Rev. Stat. § 693A.190 Mutual insurers: Additional kinds of insurance.

A domestic mutual insurer after being authorized to transact one kind of insurance may be authorized to transact such additional kinds of insurance as are permitted under NRS 680A.120, if otherwise complying with this Code and maintaining unimpaired surplus funds in an amount not less than the amount of paid-in capital stock and surplus required to be maintained by a domestic stock insurer transacting like kinds of insurance. When first so authorized to transact an additional kind of insurance, the domestic mutual insurer shall be subject to the additional expendable surplus requirements of NRS 680A.120 applicable to a stock insurer.

Nev. Rev. Stat. § 693A.200 Mutual insurers: Membership.

1. Each policyholder of a domestic mutual insurer, other than a policyholder of a reinsurance contract, is a member of the insurer during the period of the insurance with all the rights and obligations of such membership, and the policy shall so specify. 2. Any person, government or governmental agency or institution, estate, trustee or fiduciary may be a member of a mutual insurer.

Nev. Rev. Stat. § 693A.210 Mutual insurers: Bylaws.

Every domestic mutual insurer shall promptly file with the Commissioner a copy, certified by the insurers secretary, of its bylaws and of every modification thereof or addition thereto. The bylaws and modifications thereof shall be subject to the Commissioners approval. The Commissioner shall not disapprove any such bylaw or modification unless found by the Commissioner, after a hearing held thereon, to be unlawful, unreasonable, inadequate, unfair or injurious to the proper interests or protection of the insurers members or any class thereof. The insurer shall not, after receiving written notice of such disapproval and during the existence thereof, effectuate any bylaw provision so disapproved.

Nev. Rev. Stat. § 693A.220 Mutual insurers: Contingent liability of members.

1. Except as otherwise provided in NRS 693A.250 with respect to nonassessable policies, each member of a domestic mutual insurer shall have a contingent liability, pro rata and not one for another, for the discharge of its obligations incurred while such member was a policyholder of the insurer, which contingent liability shall be in such maximum amount, not less than one nor more than six times the premium for the members policy at the annual premium rate, as shall be specified in the insurers articles of incorporation. 2. Every policy issued by the insurer shall contain a statement of the contingent liability. 3. Termination of the policy of any such member shall not relieve the member of contingent liability for the members proportion of the obligations of the insurer which accrued while the policy was in force. 4. Unrealized contingent liability of members does not constitute an asset of the insurer in any determination of its financial condition.

Nev. Rev. Stat. § 693A.230 Mutual insurers: Levy of contingent liability.

1. If at any time the assets of a domestic mutual insurer are less than its liabilities and the minimum amount of surplus required to be maintained by it under this Code for authority to transact the kinds of insurance being transacted, and the deficiency is not cured from other sources, its directors may, if the same is approved by the Commissioner as being reasonable and in the best interests of the insurer and its members, levy an assessment only on its members who held policies providing for contingent liability at any time within the 12 months next preceding the date the levy was authorized by the board of directors, and such members shall be liable to the insurer for the amount so assessed. 2. The levy of assessment shall be for such an amount as is required to cure such deficiency and to provide a reasonable amount of working funds above such minimum amount of surplus, but such working funds so provided shall not exceed 5 percent of the sum of the insurers liabilities and such minimum required surplus as of the date of the levy. 3. As to the respective policies subject to the levy, the assessment shall be computed upon the basis of the premium earned during the period covered by the levy. 4. No member shall have an offset against any assessment for which the member is liable, on account of any claim for unearned premium or loss payable. 5. As to life insurance, any part of such an assessment upon a member which remains unpaid following a notice of assessment, demand for payment and lapse of a reasonable waiting period as specified in such notice may, if approved by the Commissioner as being in the best interests of the insurer and its members, be secured by placing a lien upon the cash surrender values and accumulated dividends held or to be held by the insurer to the credit of the members policy.

Nev. Rev. Stat. § 693A.240 Mutual insurers: Enforcement of contingent liability.

1. The insurer shall notify each member of the amount of the assessment to be paid by written notice mailed to the address of the member last of record with the insurer. Failure of the member to receive the notice so mailed, within the time specified therein for the payment of the assessment or at all, shall be no defense in any action to collect the assessment. 2. If a member fails to pay the assessment within the period specified in the notice, which period shall not be less than 20 days after mailing, the insurer may institute suit to collect the same.

Nev. Rev. Stat. § 693A.250 Mutual insurers: Nonassessable policies; revocation of authority.

1. A domestic mutual insurer, by depositing through the Commissioner and thereafter maintaining unimpaired surplus funds not less in amount than the minimum paid-in capital stock and surplus required of a domestic stock insurer for authority to transact the same kind or kinds of insurance, may, upon receipt of the Commissioners order so authorizing, extinguish the contingent liability to assessment of its members as to all its policies in force and, so long as such surplus and deposit are maintained, may omit provisions imposing contingent liability in all policies currently issued. Any deposit of the insurer made through the Commissioner as a prerequisite to its certificate of authority may be included as part of the deposit required under this section. 2. The Commissioner shall not authorize a domestic insurer to extinguish the contingent liability of any of its members or in any of its policies to be issued, unless it qualifies to and does extinguish such liability of all its members and in all such policies for all kinds of insurance transacted by it. 3. The Commissioner shall revoke the authority of a domestic mutual insurer to issue policies without contingent liability if: (a) The insurers assets are less than the sum of its liabilities and the surplus required for such authority and such deficiency is not cured within 30 days after written notice thereof to the insurer by the Commissioner; or (b) The insurer, by resolution of its board of directors approved by a majority of its members, requests that the authority be revoked. 4. During the absence of such authority the insurer shall not issue any policy without providing therein for the contingent liability of the policyholder, or renew any policy which is then in force without endorsing the same to provide for such contingent liability. 5. A foreign mutual insurer may issue nonassessable policies to its members in this state as authorized by its charter and the laws of the state or country of its domicile, if the requirements for issuance of such policies are substantially equal to or higher than those applicable to domestic insurers under this Code.

Nev. Rev. Stat. § 693A.260 Impairment of capital, surplus or assets: Notice; time to cure; restrictions.

1. If at any time the amount of assets of a domestic stock or mutual insurer are less than the sum of its liabilities plus its paid-in capital stock and minimum surplus required to be maintained (in the case of a stock insurer), or the minimum surplus required to be maintained (in the case of a mutual insurer), under this Code for authority to transact the kinds of insurance being transacted, the Commissioner shall at once determine the amount of the deficiency and give written notice to the insurer of the amount of impairment and require that the impairment be cured and proof thereof filed with the Commissioner within such period, not less than 30 days nor more than 90 days from date of the notice, as the Commissioner may designate. 2. If the impairment of assets is 10 percent or less of the combined required paid-in capital stock and surplus (as to a stock insurer) or surplus (as to a mutual insurer), and the Commissioner believes that the impairment might be made good by an extension of time, the Commissioner may extend the time within which the impairment may be cured by not to exceed an additional 90 days. 3. The Commissioner shall require such restriction of, or arrangements as to, operations of the insurer while the impairment exists as the Commissioner deems advisable for the protection of policyholders, the insurer or the public.

Nev. Rev. Stat. § 693A.270 Impairment of capital, surplus or assets: Curing deficiency; failure to cure.

1. A deficiency referred to in NRS 693A.260 may be made good in whole or in part in cash or in assets eligible under chapter 682A of NRS (investments) for investment of the insurers funds, or by amendment of the insurers certificate of authority to cover only such kind or kinds of insurance thereafter for which the insurer has sufficient paid-in capital stock and surplus (if a stock insurer) or surplus (if a mutual insurer) under this Code, or, if a stock insurer, by reduction of its capital stock to an amount of authorized and unimpaired paid-in capital stock not below the minimum thereof required for the kinds of insurance thereafter to be transacted. 2. If the deficiency is not made good and proof thereof filed with the Commissioner within the period required under NRS 693A.260 , the insurer shall be deemed insolvent and the Commissioner shall institute delinquency proceedings against it under chapter 696B of NRS.

Nev. Rev. Stat. § 693A.280 Impairment of capital, surplus or assets: Violation of restrictions or requirements; penalty.

If, while any such deficiency exists any officer, director, representative or employee of the insurer knowingly violates or fails to comply with any restriction or requirement placed upon the insurer and its operation by the Commissioner pursuant to NRS 693A.260, he or she shall be punished by a fine of not less than $500 nor more than $5,000 for each offense.

Nev. Rev. Stat. § 693A.290 Mutualization of stock insurer.

1. A stock insurer other than a title insurer may become a mutual insurer under such plan and procedure as may be approved by the Commissioner after a hearing thereon. 2. The Commissioner shall not approve any such plan, procedure or mutualization unless: (a) It is equitable to stockholders and policyholders; (b) It is subject to approval by the holders of not less than two-thirds of the insurers outstanding capital stock having voting rights, and by not less than two-thirds of the insurers policyholders who vote on the plan in person, by proxy or by mail pursuant to such notice and procedure as may be approved by the Commissioner; (c) If a life insurer, the right to vote thereon is limited to holders of policies other than term or group policies, whose policies have been in force for more than 1 year; (d) Mutualization will result in retirement of shares of the insurers capital stock at a price not in excess of the fair market value thereof as determined under a fair and reasonable formula approved by the Commissioner or, if so ordered, by an examination of the insurer and all of its controlled affiliates or by an appraisal committee, consisting of at least three qualified persons, to be appointed by the Commissioner; (e) The plan provides for the purchase of the shares of any nonconsenting stockholder in the same manner and subject to the same applicable conditions as provided by the general corporation law of the state as to rights of nonconsenting stockholders, with respect to consolidation or merger of private corporations; (f) The plan provides for definite conditions to be fulfilled by a designated early date upon which such mutualization will become effective; and (g) The mutualization leaves the insurer with a surplus reasonably adequate for the security of its policyholders and to enable it to continue successfully in business in the states in which it is then authorized to transact insurance, and for the kinds of insurance included in its certificates of authority in such states. 3. No director, officer, agent or employee of the insurer, or any other person, may receive any fee, commission or other valuable consideration whatsoever, other than his or her customary salary or other regular compensation, for in any manner aiding, promoting or assisting in the mutualization, except as set forth in the plan of mutualization as approved by the Commissioner. 4. This section does not apply to mutualization under an order of court pursuant to rehabilitation or reorganization of an insurer under chapter 696B of NRS.

Nev. Rev. Stat. § 693A.300 Conversion to ordinary business corporation.

1. A domestic stock insurer may convert to a Nevada ordinary business corporation through the following procedures: (a) The insurer must give the Commissioner written notice of its intent to convert to an ordinary business corporation. (b) The insurer must bulk reinsure all of its insurance in force, if any, with another authorized insurer under a bulk reinsurance agreement approved by the Commissioner as provided in NRS 693A.370 . The agreement of bulk reinsurance may be made contingent upon approval of the stockholders as provided in paragraph (d). (c) The insurer must set aside in a special reserve funds in such amount and subject to such administration as may be found by the Commissioner to be adequate and reasonable for the purpose, for payment of all obligations, if any, of the insurer incurred by it under its insurance contracts prior to the effective date of such bulk reinsurance, and remaining unpaid, or make other reasonable disposition satisfactory to the Commissioner for such payment. (d) The proposed conversion must be approved by an affirmative vote of not less than two-thirds of each class of the outstanding securities of the insurer having voting rights, at a special meeting of holders of such securities called for the purpose, and at such meeting and by a like vote the articles of incorporation of the corporation must be amended to remove therefrom the power to transact an insurance business as an insurer and to provide for such new powers and purposes as may be consistent with the purposes for which the corporation is thereafter to exist. (e) Security holders of the corporation who dissent from such proposed conversion shall have the same applicable rights as exist under the general corporation laws of this state with respect to a dissent from a proposed merger of the corporation. (f) Upon compliance with paragraphs (a) to (d), inclusive, and upon filing of the amendment of the articles of incorporation as required by law, the conversion shall thereupon become effective. 2. An insurer which has once converted to an ordinary business corporation shall not have the power thereafter to convert to an insurer.

Nev. Rev. Stat. § 693A.310 Affiliation of stock insurers.

1. A domestic stock insurer shall not acquire a controlling interest in the shares of another stock insurer by an exchange of securities or partly in exchange for securities and partly for cash or property, unless the insurer has first submitted the plan for such acquisition and exchange to the Commissioner and the Commissioner has approved the same. 2. The Commissioner shall not so approve unless the Commissioner finds the plan for such acquisition and the terms and conditions thereof to be fair and equitable to all parties concerned therein, after a hearing at which all persons to whom it is proposed to issue securities in such exchange shall have the right to appear. 3. Notice and conduct of such hearing shall be as provided in NRS 679B.310 to 679B.370 , inclusive.

Nev. Rev. Stat. § 693A.320 Acquisition of controlling stock.

1. Any person proposing to acquire the controlling capital stock of any domestic stock insurer and thereby to change the control of the insurer, other than through merger or consolidation or affiliation as provided for in NRS 693A.310 and 693A.330 , must first apply to the Commissioner in writing for approval of the proposed change of control. The application must state the names and addresses of the proposed new owners of the controlling stock and contain such additional information as the Commissioner may reasonably require. 2. The Commissioner shall not approve the proposed change of control if the Commissioner finds that: (a) The proposed new owners are not qualified by character, experience and financial responsibility to control and operate the insurer, or cause the insurer to be operated, in a lawful and proper manner; (b) As a result of the proposed change of control the insurer may not be qualified for a certificate of authority under the provisions of NRS 680A.090 ; (c) The interests of the insurer or other stockholders of the insurer or policyholder would be materially harmed through the proposed change of control; or (d) The proposed change of control would tend materially to lessen competition, or to create any monopoly, in a business of insurance in this state or elsewhere. 3. If the Commissioner does not by affirmative action approve or disapprove the proposed change of control within 60 days after the date the application was so filed with the Commissioner, the proposed change may be made without the approval of the Commissioner, but if the Commissioner gives notice to the parties of a hearing to be held by the Commissioner with respect to the proposed change of control, and the hearing is held within the 30 days or on a date mutually acceptable to the Commissioner and the parties, the Commissioner has 10 days after the conclusion of the hearing within which to so approve or disapprove the proposed change. If not so approved or disapproved, the change may thereafter be made without the Commissioners approval. 4. If the Commissioner disapproves the proposed change, the Commissioner shall give written notice thereof to the parties, setting forth in detail the reasons for disapproval. 5. The Commissioner shall suspend or revoke the certificate of authority of any insurer the control of which has been changed in violation of this section. 6. The Commissioner may retain at the acquiring partys expense attorneys, actuaries, accountants and other experts not otherwise a part of the staff of the Commissioner as may be necessary only for the review of the proposed acquisition of control. Such a review may be conducted only if the parties fail to provide sufficient information to the Commissioner. Expenses chargeable to the acquiring party pursuant to this subsection must not exceed 1 percent of the acquired insurers net revenue during the year immediately preceding the year in which the application for change of control is filed with the Commissioner pursuant to subsection 1.

Nev. Rev. Stat. § 693A.330 Merger or consolidation of stock insurers.

1. Subject to subsections 2 and 3, a domestic stock insurer may merge or consolidate with one or more domestic or foreign stock insurers, by complying with the applicable provisions of the statutes of this state governing the merger or consolidation of stock corporations formed for profit. A domestic stock insurer shall not merge or consolidate with any corporation not formed for the purpose of transacting insurance as an insurer. 2. No such merger or consolidation shall be effectuated unless in advance thereof the plan and agreement therefor have been filed with the Commissioner and approved in writing by the Commissioner after a hearing thereon after notice to the stockholders of each insurer involved. The Commissioner shall give such approval within a reasonable time after such filing unless the Commissioner finds such plan or agreement: (a) Is contrary to law; (b) Unfair or inequitable to the stockholders of any insurer involved; (c) Would substantially reduce the security of and service to be rendered to policyholders of the domestic insurer in this state or elsewhere; (d) Would materially tend to lessen competition in the insurance business in this state or elsewhere as to the kinds of insurance involved, or would materially tend to create a monopoly as to such business; or (e) Is subject to other material and reasonable objections. 3. No director, officer, agent or employee of any insurer party to such merger or consolidation shall receive any fee, commission, special compensation or other valuable consideration whatsoever for in any manner aiding, promoting or assisting therein except as set forth in such plan or agreement. 4. If the Commissioner does not approve any such plan or agreement, the Commissioner shall so notify the insurer in writing specifying the reasons therefor.

Nev. Rev. Stat. § 693A.340 Preservation of original charter in merger or consolidation.

1. In any merger or consolidation of a foreign stock or mutual insurer into or with a domestic insurer under NRS 693A.330 or 693A.350 , and if so provided in accordance with this section, the continuing Nevada corporation shall for all purposes be deemed to be a continuation of the corporate existence of the foreign corporation, with Nevada as the adoptive state of domicile and with date of corporate origin the same as the original date of incorporation of the foreign insurer in its original domiciliary state or country, subject to the following conditions: (a) The plan and agreement for merger or consolidation shall provide for such continuation of corporate existence through designation of Nevada as the state of domicile of the foreign corporation by adoption, and shall specify the original date of incorporation of the foreign corporation in its original domiciliary state or country as being the date of incorporation of the Nevada corporation pursuant to this section. (b) The articles of incorporation of the Nevada corporation shall provide, or be amended to provide, that the corporation is a continuance of the corporate existence, through adoption of the State of Nevada as the corporate domicile, of the foreign corporation, and shall specify the original date of incorporation of the foreign corporation in its original domiciliary state or country as being the date of incorporation of the Nevada corporation pursuant to this section. 2. The continuing Nevada corporation shall have all the rights and obligations of, and be given recognition in all respects as, a corporation formed under the laws of this state as of the date of incorporation of the foreign corporation in its original domiciliary state or country. This provision shall not be deemed to impose upon the continuing Nevada corporation any liability or obligation with respect to filings, fees, taxes or otherwise which might have accrued prior to the effective date of the merger or consolidation. 3. This section shall not be deemed in any manner to preserve, after the effective date of such merger or consolidation, the corporate existence of such foreign corporation as a corporation of its original domiciliary state or country.

Nev. Rev. Stat. § 693A.350 Merger or consolidation of mutual insurers.

1. A domestic mutual insurer shall not merge or consolidate with a stock insurer. 2. Except as provided in this section, a domestic mutual insurer may merge or consolidate with another mutual insurer under the applicable procedures prescribed by the laws of this State governing ordinary business corporations. 3. If the insurer is then unimpaired, the plan and agreement for merger or consolidation must be submitted to and approved by at least two-thirds of the members of each mutual insurer voting thereon at meetings called for the purpose pursuant to reasonable notice and procedure. The plan and agreement may provide for giving that notice to members by publishing the notice once a week for 2 successive weeks in any two of the four cities of greatest population in each state in which the insurer is authorized, or by depositing the notice in the United States mail, postage prepaid, addressed to the member at his or her address last of record with the insurer, or by personal delivery. For a life insurer, the right to vote may be limited to members whose policies are other than term and group policies, and have been in effect for more than 1 year. 4. No such merger or consolidation may be effectuated unless in advance thereof the plan and agreement therefor have been filed with the Commissioner and approved by the Commissioner in writing. If the insurer is not then impaired the Commissioner shall not act upon the plan and agreement until after a hearing thereon. The Commissioner shall give approval within a reasonable time after the filing unless the Commissioner finds the plan or agreement: (a) Inequitable to the policyholders of any domestic insurer involved; (b) Would substantially reduce the security of and service to be rendered to policyholders of the domestic insurer in this State and elsewhere; (c) Would materially tend to lessen competition in the insurance business in this State or elsewhere as to the kinds of insurance involved, or would materially tend to create any monopoly as to that business; or (d) Is subject to other material and reasonable objections. 5. If the Commissioner does not approve the plan or agreement the Commissioner shall so notify the insurers in writing specifying the reasons therefor. 6. No director, officer, agent or employee of any insurer party to such merger or consolidation, or any other person, shall receive any fee, commission or other special valuable consideration whatsoever for in any manner aiding, promoting or assisting therein except as set forth in the plan and agreement approved by the Commissioner.

Nev. Rev. Stat. § 693A.365 Assumption of reinsurance: Limitations; application of provisions.

1. A domestic property or casualty insurer with less than $3,000,000 in surplus as regards policyholders shall not, without the written approval of the Commissioner, assume reinsurance on any risk that it otherwise is permitted to assume, except if the reinsurance is required by law or regulation. 2. The provisions of this section are applicable to a contract of reinsurance executed or renewed on or after October 1, 1991. 3. The provisions of this section do not invalidate any reinsurance contract between the parties to the contract.

Nev. Rev. Stat. § 693A.370 Bulk reinsurance: Limitation; approval by Commissioner and members.

1. A domestic insurer shall not reinsure with another insurer all or substantially all of its business in force, or of a major class thereof, or during a period of 6 consecutive months reinsure with another insurer over 20 percent of its insurance in force exclusive of individual risks currently reinsured in the ordinary course of business, except under an agreement of bulk reinsurance and in compliance with this section. No such agreement may become effective unless filed with the Commissioner and approved by the Commissioner in writing. 2. The Commissioner shall approve the agreement within a reasonable time after filing if the Commissioner finds that: (a) The plan and agreement are fair and equitable to each insurer and to the policyholders involved; (b) The reinsurance, if effectuated, would not substantially reduce the protection or service to the policyholders of any domestic insurer involved; (c) The agreement embodies adequate provisions by which the reinsuring insurer becomes liable to the original insureds for any loss or damage occurring under the policies reinsured in accordance with the original terms of those policies; (d) The assuming reinsurer is authorized to transact that insurance in this State, or is qualified for that authorization and will appoint the Commissioner and the successors of the Commissioner as its irrevocable attorney for service of process, so long as any policy so reinsured or claim thereunder remains in force or outstanding; (e) The reinsurance would not materially tend to lessen competition in the insurance business in this State or elsewhere as to the kinds of insurance involved, and would not materially tend to create any monopoly as to that business; and (f) The proposed bulk reinsurance is free of other reasonable objections. 3. If the Commissioner does not so approve the Commissioner shall forthwith notify each insurer involved in writing, specifying the reasons therefor. 4. If for reinsurance of all or substantially all of the business in force of a mutual insurer at a time when the insurers surplus is not impaired, the plan and agreement for reinsurance must be approved by a vote of not less than two-thirds of the mutual insurers members voting thereon at a meeting of members called for the purpose, pursuant to such reasonable notice and procedure as is provided for in the agreement. The agreement may provide for giving notice to members of a mutual insurer by publishing the notice once a week for 2 successive weeks in any two of the four cities of greatest population in each state in which the insurer is authorized, or by depositing the notice in the United States mail, postage prepaid, addressed to the member at his or her address last of record with the insurer, or by personal delivery. For a life insurer, the right to vote may be limited to members whose policies are other than term or group policies, and have been in effect for more than 1 year.

Nev. Rev. Stat. § 693A.380 Bulk reinsurance: Certificate of fees and commissions; restrictions upon payment; penalty.

1. At the time of filing the agreement of bulk reinsurance with the Commissioner as provided in NRS 693A.370 , the parties shall also file with the Commissioner a certificate or certificates under oath of a principal officer of each insurer involved, as to fees, commissions and other valuable considerations paid or to be paid to any person directly or indirectly in connection with the agreement or the proposed bulk reinsurance. This subsection does not apply to fees of attorneys, accountants, actuaries and other independently contracting persons rendering similar technical services in connection with the bulk reinsurance, or to regular salaried compensation received or to be received by employees in the ordinary course of business. 2. No director or officer of any insurer party to such bulk reinsurance shall, except as fully expressed in the bulk reinsurance agreement, receive any fee, commission or other special or valuable consideration whatever, directly or indirectly, for in any manner aiding, promoting or assisting in the negotiation or effectuation of such reinsurance. 3. Any person violating the provisions of subsection 2 is guilty of a gross misdemeanor.

Nev. Rev. Stat. § 693A.390 Members share of assets on liquidation.

1. Upon any liquidation of a domestic mutual insurer, its assets remaining after discharge of its indebtedness, policy obligations, repayment of contributed or borrowed surplus, if any, and expenses of administration shall be distributed to currently existing persons who had been members of the insurer for at least 1 year and who were its members at any time within 36 months next preceding the date such liquidation was authorized or ordered, or the date of the last termination of the insurers certificate of authority whichever date is the earlier; but if the Commissioner has reason to believe that those in charge of the management of the insurer have caused or encouraged the reduction of the number of members of the insurer in anticipation of liquidation and for the purpose of reducing thereby the number of persons who may be entitled to share in the distribution of the insurers assets, the Commissioner may enlarge the 36-month qualification period as the Commissioner may deem to be reasonable. 2. The insurer shall make a reasonable classification of its policies so held by such members, and a formula based upon such classification for determining the equitable distributive share of each such member. Such classification and formula shall be subject to the approval of the Commissioner.

Nev. Rev. Stat. § 693A.400 Definitions.

As used in NRS 693A.400 to 693A.540, inclusive, unless the context otherwise requires, the words and terms defined in NRS 693A.405 to 693A.430, inclusive, have the meanings ascribed to them in those sections.

Nev. Rev. Stat. § 693A.405 Closed block defined.

Closed block means an allocation of assets of the converting mutual sufficient to maintain payments of guaranteed benefits and the continuation of the current dividends for eligible members.

Nev. Rev. Stat. § 693A.410 Consideration defined.

Consideration means cash, stock or other valuable compensation approved by the Commissioner.

Nev. Rev. Stat. § 693A.415 Converting mutual defined.

Converting mutual means a domestic mutual insurance company or a mutual insurance holding company that has adopted a plan of conversion to a domestic stock insurance company pursuant to NRS 693A.400 to 693A.540, inclusive.

Nev. Rev. Stat. § 693A.420 Eligible member defined.

Eligible member means a person who has a membership interest in the converting mutual on the date on which the board of directors of the converting mutual adopts a resolution proposing a plan of conversion and an amendment to its articles of incorporation.

Nev. Rev. Stat. § 693A.425 New stock insurer defined.

New stock insurer means the domestic stock insurer that is created when the Commissioner issues a certificate of authority to a converting mutual pursuant to NRS 693A.470.

Nev. Rev. Stat. § 693A.430 Policyholder defined.

Policyholder means a person who holds a policy issued by the converting mutual on the day on which the plan of conversion is initially approved by the board of directors of the converting mutual.

Nev. Rev. Stat. § 693A.435 Procedure for conversion.

A domestic mutual insurer or a mutual insurance holding company may amend its articles of incorporation to become a domestic stock insurer by complying with NRS 693A.400 to 693A.540, inclusive, and obtaining a certificate of authority from the Commissioner.

Nev. Rev. Stat. § 693A.440 Resolution by board of directors; plan of conversion.

1. The board of directors of a domestic mutual insurer or a mutual insurance holding company may adopt a resolution proposing a plan of conversion and an amendment to its articles of incorporation. The resolution must be approved by a vote of not less than two-thirds of the members of the board. 2. The plan of conversion must: (a) Require the distribution of consideration equal to not less than the fair market value of the surplus of the converting mutual to the eligible members in exchange for the extinguishment of their membership interests in the converting mutual. (b) Describe the manner in which the fair market value of the converting mutual and its surplus has been or will be determined. (c) Require the distribution of consideration to the eligible members upon extinguishment of their membership interests in the converting mutual. (d) Provide that membership interests in the converting mutual are extinguished as of the effective date of conversion. (e) Specify the structure and form of the proposed consideration, including, without limitation, the projected range of the number of shares of capital stock to be: (1) Issued to policyholders by the new stock insurer or the holding company of the new stock insurer; and (2) Sold or reserved for sale to investors by the new stock insurer or the holding company of the new stock insurer, or to the trust established pursuant to this section. (f) If the distribution of consideration will not be made immediately following the final order of the Commissioner approving the conversion, provide for the establishment of a trust for the exclusive benefit of policyholders into which shares of the capital stock of the new stock insurer or the holding company of the new stock insurer must be placed pending distribution to the policyholders. The terms of the trust are subject to the approval of the Commissioner. Such a trust may exist only for a period of 6 months after the final approval of the conversion, during which time the distribution of consideration to eligible policyholders and other persons must be completed. (g) Provide for the determination of the reasonable dividend expectations of eligible members and other policyholders of policies that provide for distribution of policy dividends and the preservation of such expectations through the establishment of a closed block of assets. (h) Provide for such other proposed conditions and provisions as the board of directors of the converting mutual determines are necessary and are not inconsistent with the provisions of NRS 693A.400 to 693A.540 , inclusive.

Nev. Rev. Stat. § 693A.445 Application for conversion: Filing and contents; filing fee.

A converting mutual shall file with the Commissioner an application to convert to a domestic stock insurer. The application must be accompanied by a nonrefundable fee of $2,450. The application must include, without limitation: 1. The plan of conversion adopted by the board of directors. 2. A certification that the plan of conversion was duly adopted by a vote of not less than two-thirds of the members of the board of directors of the converting mutual. 3. A certification that the plan of conversion is fair and equitable to the policyholders. This certification must be adopted by a vote of not less than two-thirds of the members of the board of directors of the converting mutual. 4. A statement of the reasons for the proposed conversion and why the conversion is in the best interest of the converting mutual, including, without limitation, a: (a) Detailed analysis of the risks and benefits of the proposed conversion to the converting mutual and its members; and (b) Comparison of the risks and benefits of the conversion with the risks and benefits of a reasonable alternative to the conversion. 5. A written opinion addressed to the board of directors of the converting mutual from a qualified, independent financial adviser attesting that the: (a) Consideration to be provided to the membership of the converting mutual is fair to the eligible members as a group; and (b) Total consideration to be provided to the membership is equal to or greater than the surplus of the converting mutual. 6. An opinion from a qualified actuary attesting that all methodologies and formulas used to allocate the consideration among eligible members are reasonable. 7. Certified copies of the proposed amendments to the articles of incorporation and bylaws to effect the conversion. 8. A copy of the form of the trust agreement of any trust to be used in connection with the conversion. 9. A plan of operation for a closed block to preserve the reasonable dividend expectations of eligible members and other policyholders of policies that provide for the distribution of policy dividends. 10. A form of the proposed notice to be mailed by the converting mutual to its policyholders as required by NRS 693A.460 . 11. A 5-year business plan and at least 2 years of financial projections for the new stock insurer and a parent company, if any. 12. A list of natural persons who are or have been selected to become directors or officers of the new stock insurer and the following information concerning each person on the list, unless the information is already on file with the Commissioner: (a) Occupation; (b) Criminal convictions, other than traffic violations, during the immediately preceding 7 years; (c) Personal bankruptcy of the person or the spouse of the person during the immediately preceding 7 years; (d) Information regarding any consent decree entered into by the person; and (e) Whether the person has been refused a fidelity or other bond during the immediately preceding 7 years. 13. Any plans that the new stock insurer or its parent company, if any, may have to: (a) Raise additional capital through the issuance of stock or otherwise; (b) Sell or issue stock to any person; (c) Liquidate or dissolve any company or sell any material assets; (d) Merge, consolidate or pursue any other form of reorganization with any person; or (e) Make any material change in its investment policy, business, corporate structure or management. 14. Copies of proposed articles of incorporation and any proposed bylaws of the new stock insurer. 15. Such additional information as the Commissioner may by regulation prescribe as necessary or appropriate for the protection of policyholders and security holders of the converting mutual, or for the protection of the public interest.

Nev. Rev. Stat. § 693A.450 Public hearing on application.

The Commissioner shall conduct a public hearing not later than 120 days after the date on which the application is filed unless, for good cause, the Commissioner extends this time. Any interested person may appear or otherwise be heard at the public hearing. The Commissioner may continue the hearing for a reasonable period, not to exceed 60 days. The converting mutual shall give such reasonable notice of the hearing as the Commissioner requires. The hearing must be conducted pursuant to NRS 679B.320 to 679B.370, inclusive.

Nev. Rev. Stat. § 693A.455 Action by Commissioner on application.

1. The Commissioner shall issue an order making an initial determination of approval or disapproval of the application not later than 30 days after the public hearing. 2. The Commissioner shall not approve the application unless the Commissioner finds that the: (a) Plan of conversion is fair and equitable to the policyholders; (b) Plan of conversion does not deprive the policyholders of their property rights or due process of law; (c) New stock insurer meets the minimum requirements for a certificate of authority to transact the business of insurance in this state; and (d) Continued operation of the new stock insurer is not hazardous to future policyholders and the public. 3. For the purposes of this section, the Commissioner may consider any relevant factor, including, without limitation: (a) The capital requirements of the new stock insurer; (b) Whether a sufficient portion of the surplus of the converting mutual was contributed by persons or entities whose policies or contracts were not in force on the date on which the plan of conversion was initially approved by the board of directors of the converting mutual to require the reduction of the consideration to policyholders to an amount equal to less than the surplus; (c) Whether the plan of conversion includes preemptive rights for policyholders to purchase securities offered in the initial sale of securities by the new stock insurer; (d) Whether the plan of conversion includes establishment of a preference account from which the payment of any shareholder dividends, including a regular, special or liquidation dividend, would be prohibited for such a reasonable period as the Commissioner may require; (e) The suitability of the trustees of any trust created to effect the conversion; and (f) Whether the utilization of a trust, if included in the plan of conversion, has a material adverse effect on policyholders, other than delaying the receipt of shares of capital stock. 4. If the Commissioner makes a determination to disapprove the application, the Commissioner shall issue a final order setting forth specific findings for the disapproval.

Nev. Rev. Stat. § 693A.460 Meeting and vote of policyholders; notice.

1. Unless the Commissioner for good cause establishes a different time, the converting mutual shall, not less than 45 days after the date of the initial determination of approval by the Commissioner, hold a meeting of its policyholders at a reasonable time and place to vote upon the plan of conversion. 2. The converting mutual shall give notice not less than 30 days before the meeting, by first-class mail to the last known address of each policyholder, that the plan of conversion will be voted upon at a regular or special meeting of the policyholders. The notice must include, without limitation, a: (a) Brief description of the plan of conversion; (b) Statement that the Commissioner has initially approved the plan of conversion; and (c) Written proxy permitting the policyholder to vote for or against the plan of conversion. 3. The Commissioner shall supervise and direct the conducting of the vote on the plan of conversion as necessary to ensure that the vote is fair and consistent with the requirements of this section. Each policyholder is entitled to only one vote regardless of the number of policies owned by the policyholder. 4. A plan of conversion is approved only if not less than two-thirds of the policyholders voting in person or by proxy at the meeting vote in favor of the plan of conversion. 5. For the purposes of notice and voting, the policyholder of a policy of group insurance is the entity to which the group policy is issued and not any person covered under the group policy.

Nev. Rev. Stat. § 693A.465 Abandonment of plan of conversion.

A converting mutual may, by not less than a two-thirds vote of the members of its board of directors and with the approval of the Commissioner, abandon the plan of conversion at any time before the issuance of the certificate of authority by the Commissioner pursuant to NRS 693A.470. Upon abandonment, all rights and obligations arising out of the plan of conversion terminate and the converting mutual shall continue to conduct its business as a domestic mutual insurer or a mutual insurance holding company as though no plan of conversion had ever been adopted.

Nev. Rev. Stat. § 693A.470 Issuance and notice of final order approving application; issuance and effect of certificate of authority.

1. The Commissioner shall: (a) Enter a final order approving the application to convert to a stock insurer within 10 days after receiving a valid certification from the converting mutual setting forth the vote and certifying that the plan of conversion was approved by not less than two-thirds of the policyholders voting in person or by proxy on the plan of conversion; and (b) Publish notification of the issuance of the final order in a newspaper of general circulation in Carson City and in the county of domicile of the converting mutual if different from Carson City. 2. Except as otherwise provided in NRS 693A.465 , the Commissioner shall issue a certificate of authority to the new stock insurer when the converting mutual files a certificate with the Commissioner stating that all the conditions set forth in the plan of conversion have been satisfied. 3. The conversion is effective upon the issuance of the certificate of authority by the Commissioner. 4. Upon issuance of the certificate of authority, the articles of incorporation of the insurer shall be deemed to be amended in compliance with NRS 692B.030 .

Nev. Rev. Stat. § 693A.475 Authority of Commissioner to engage services of experts; payment of costs to review plan of conversion.

In determining whether a plan of conversion meets the requirements of NRS 693A.400 to 693A.540, inclusive, or with regard to any other matters relating to the development of a plan of conversion, the Commissioner may engage the services of experts. All reasonable costs related to the review of a plan of conversion or such other matters, including those costs attributable to the use of experts, must be paid by the converting mutual filing the application or initiating discussions with the Commissioner about such matters.

Nev. Rev. Stat. § 693A.480 Confidentiality and publication of pertinent information and documents.

1. Except as otherwise provided in subsection 2 and NRS 239.0115 , all information and documents obtained by or disclosed to the Commissioner or any other person in the course of preparing, filing and processing an application of a converting mutual, other than information and documents distributed to policyholders in connection with the meeting of policyholders pursuant to NRS 693A.460 or filed or submitted as evidence in connection with the public hearing pursuant to NRS 693A.450 , are confidential and not subject to subpoena, and must not be made public by the Commissioner, the National Association of Insurance Commissioners or any other person, except to insurance departments of other states, without the prior written consent of the insurer to which such information and documents pertain. 2. If the Commissioner, after giving the insurer and its affiliates who would be affected notice and opportunity to be heard, determines that the interests of policyholders, shareholders or the public will be best served by the publication of such information and documents, the Commissioner may publish all or any part thereof in such a manner as the Commissioner determines appropriate.

Nev. Rev. Stat. § 693A.485 Continuation of corporate existence of converting mutual.

The corporate existence of a converting mutual pursuant to NRS 693A.400 to 693A.540, inclusive, does not terminate, and the new stock insurer shall be deemed to be a continuation of the converting mutual and to have been organized on the date the converting mutual was originally organized.

Nev. Rev. Stat. § 693A.490 Purchase of stock by directors, officers, employees, agents or trustees.

The provisions of NRS 693A.400 to 693A.540, inclusive, do not prohibit the inclusion in the plan of conversion of provisions under which members of the board of directors, officers, employees or agents of the new stock insurer, and persons acting as trustees of employee stock ownership plans or other employee benefit plans may be entitled to purchase for cash capital stock of the new stock insurer at the same price initially issued by the new stock insurer under the plan of conversion, except that no such purchase may be made while any shares of capital stock are held in a trust established pursuant to the plan of conversion.

Nev. Rev. Stat. § 693A.495 Receipt of fee, commission or other consideration for aiding, promoting or assisting in plan of conversion.

1. No director, officer, employee or agent of the converting mutual, or any other person, may receive any fee, commission or other valuable consideration, other than his or her usual regular salary and compensation, for aiding, promoting or assisting in a plan of conversion except as set forth in the plan of conversion approved by the Commissioner. 2. Subsection 1 does not prohibit a management or employee incentive compensation program that is contained in the plan of conversion and approved by the Commissioner to be adopted upon conversion to the new stock insurer or prohibit such a program to be adopted later by the new stock insurer. 3. Subsection 1 does not prohibit the payment of reasonable fees and compensation to attorneys, accountants, actuaries and investment bankers for services performed in the independent practice of their professions if the person is also a member of the board of directors of the converting mutual.

Nev. Rev. Stat. § 693A.500 Offers to acquire and acquisition of voting securities of new stock insurer or institution that owns majority of voting securities of new stock insurer.

1. Except as otherwise specifically provided in the plan of conversion, before and for a period of 5 years after the issuance of a certificate of authority to a new stock insurer pursuant to NRS 693A.470 , no person other than the new stock insurer may directly or indirectly offer to acquire or acquire in any manner the beneficial ownership of 5 percent or more of any class of a voting security of the new stock insurer or of any institution that owns a majority of the voting securities of the new stock insurer without the prior approval by the Commissioner of an application for acquisition. 2. The Commissioner shall not approve an application for acquisition filed pursuant to subsection 1 unless the Commissioner finds that: (a) The acquisition will not frustrate the plan of conversion as approved by the policyholders and the Commissioner; (b) The board of directors of the new stock insurer has approved the acquisition or extraordinary circumstances not contemplated in the plan of conversion have arisen which would warrant approval of the acquisition; and (c) The acquisition is consistent with the purpose of NRS 693A.400 to 693A.540 , inclusive, to permit conversions on terms and conditions that are fair and equitable to the policyholders. 3. An application for acquisition filed pursuant to subsection 1 must describe in sufficient detail all information necessary for the approval of the application. 4. If any material change occurs in the facts set forth in an application for acquisition filed pursuant to subsection 1, an amendment setting forth the change, together with copies of all documents and other material relevant to the change, must be filed with the Commissioner. 5. The Commissioner may hold a public hearing on an application for acquisition filed pursuant to subsection 1. If the Commissioner decides to hold a public hearing, the hearing must be held not later than 30 days after the person seeking to acquire securities files an application for acquisition with the Commissioner pursuant to subsection 1. The Commissioner shall give at least 20 days notice of the hearing to the person filing the application for acquisition. The person filing the application for acquisition shall give not less than 7 days notice of the hearing to the new stock insurer and to such other persons as may be designated by the Commissioner. In connection with the hearing, the person filing the application for acquisition, the new stock insurer, any other person to whom notice of the hearing was given, and any other person whose interest may be affected may conduct discovery proceedings in the same manner as is allowed in the district court. All discovery proceedings must be concluded not later than 3 days before the commencement of the hearing. At the hearing, the person filing the application for acquisition, the new stock insurer, any other person to whom notice of the hearing was given, and any other person whose interest may be affected may present evidence, examine and cross-examine witnesses, and offer oral and written arguments. If any acquisition referred to in the application for acquisition is proposed by means of a registration statement under the Securities Act of 1933, 15 U.S.C. §§ 77a et seq., in circumstances requiring the disclosure of similar information under the Securities Exchange Act of 1934, 15 U.S.C. §§ 78a et seq., or under a state law requiring similar registration or disclosure, the person required to file the statement may utilize such documents in furnishing the information required by the application for acquisition. The person filing the application shall serve the new stock insurer and any institution that owns a majority of the voting securities of the new stock insurer with a copy of the application for acquisition and any amendments thereto on the day the documents are filed with the Commissioner. 6. The new stock insurer and any institution that owns a majority of the voting securities of the new stock insurer must be permitted to become parties to the hearing upon request. 7. The Commissioner may retain, at the expense of the person filing an application for acquisition pursuant to subsection 1, any attorneys, actuaries, accountants and other experts who are not employees of the Division as may be reasonably necessary to assist the Commissioner in reviewing the application.

Nev. Rev. Stat. § 693A.505 Unlawful acquisition of securities: Voting of securities prohibited; injunctive and other relief.

1. No security which is the subject of any agreement or arrangement regarding acquisition, or which is acquired or to be acquired, in contravention of NRS 693A.500 or of any regulation or order of the Commissioner may be voted at any shareholders meeting or may be counted for quorum purposes, and any action of the shareholders requiring the affirmative vote of a percentage of shares may be taken as though such securities were not issued and outstanding, but no action taken at any such meeting may be invalidated by the voting of such securities unless: (a) The action would materially affect control of the new stock insurer or an institution that owns a majority of the voting securities of the new stock insurer; or (b) A court of competent jurisdiction has so ordered. 2. If a new stock insurer or the Commissioner has reason to believe that any security of the new stock insurer or an institution that owns a majority of the voting securities of the new stock insurer has been or is about to be acquired in contravention of NRS 693A.400 to 693A.540 , inclusive, or of any regulation or order of the Commissioner, the new stock insurer or the Commissioner may apply to the First Judicial District Court in and for Carson City for an order to enjoin any offer or acquisition made in contravention of NRS 693A.500 or any regulation or order of the Commissioner to enjoin the voting of any security so acquired, to void any vote of such a security already cast at any shareholders meeting, and for such other equitable relief as the nature of the case and the interest of the policyholders, creditors and shareholders of the new stock insurer, or the public, may require.

Nev. Rev. Stat. § 693A.510 Unlawful acquisition of securities: Seizure or sequestration of securities.

In any case where a person has acquired or is proposing to acquire any voting securities in violation of NRS 693A.400 to 693A.540, inclusive, or any regulation or order of the Commissioner, the First Judicial District Court in and for Carson City may, upon the application of the Commissioner or the new stock insurer, and on such notice as the court determines appropriate, seize or sequester any voting securities of the new stock insurer or an institution that owns a majority of the voting securities of the new stock insurer owned directly or indirectly by such a person and issue any order with respect thereto as the court determines appropriate to effectuate the provisions of NRS 693A.400 to 693A.540, inclusive. Notwithstanding any other provision of law, for the purposes of NRS 693A.400 to 693A.540, inclusive, the situs of the ownership of such securities shall be deemed to be in this state.

Nev. Rev. Stat. § 693A.515 Unlawful acquisition of securities: Imposition of administrative penalty for violation.

A person who offers to acquire or acquires a security in violation of subsection 1 of NRS 693A.500 may be required by the Commissioner, after notice and hearing, to pay an administrative penalty of $100 for each day that the person remains in violation, except that the aggregate penalty pursuant to this section may not exceed $10,000.

Nev. Rev. Stat. § 693A.520 Unlawful acquisition of securities: Imposition of administrative penalty against director, officer or agent.

Any director or officer of a person, or an agent of the person, who knowingly violates or assents to or permits any officer or agent of the person to violate the requirements of NRS 693A.500 may be required by the Commissioner, after notice and hearing, to pay, in his or her individual capacity, an administrative penalty of not more than $5,000 per violation. In determining the amount of the penalty, the Commissioner shall take into account the appropriateness of the penalty with respect to the gravity of the violation, the history of previous violations, and such other matters as the Commissioner determines are required in the interest of justice.

Nev. Rev. Stat. § 693A.525 Unlawful acquisition of securities: Orders by Commissioner.

1. If the Commissioner has reason to believe that any person or any director, officer, employee or agent of the person is engaged in any conduct in violation of NRS 693A.500 , the Commissioner may order the person to cease and desist immediately from engaging in any further such conduct. The order is permanent unless the person, not later than 20 days after receipt of the order, files a written request for a hearing with the Commissioner. 2. If, after a hearing pursuant to subsection 1, the Commissioner determines that such action is in the best interest of the policyholders, the creditors or the public, the Commissioner may also order the person to void any contract entered into in violation of NRS 693A.500 . 3. An order of the Commissioner pursuant to this section is a final decision in a contested case for the purpose of judicial review pursuant to chapter 233B of NRS.

Nev. Rev. Stat. § 693A.530 Regulations and orders of Commissioner.

The Commissioner may adopt such regulations and issue such orders as the Commissioner determines are necessary to carry out the provisions of NRS 693A.400 to 693A.540, inclusive.

Nev. Rev. Stat. § 693A.535 Judicial review of final order of Commissioner.

Any person aggrieved by a final order of the Commissioner issued pursuant to NRS 693A.400 to 693A.540, inclusive, may petition for judicial review in the manner provided by chapter 233B of NRS.

Nev. Rev. Stat. § 693A.540 Enforcement of provisions by Commissioner.

Whenever it appears to the Commissioner that any person or any director, officer, employee or agent of the person has committed or is about to commit a violation of any provision of NRS 693A.400 to 693A.540, inclusive, or of any regulation or order of the Commissioner relating thereto, the Commissioner may apply to the First Judicial District Court in and for Carson City for an order enjoining the person, director, officer, employee or agent from violating or continuing to violate any provision of NRS 693A.400 to 693A.540, inclusive, or any such regulation or order, and for such other equitable relief as the nature of the case and the interest of the policyholders, creditors and shareholders of the insurer, or the public, may require.

Nev. Rev. Stat. § 693A.550 Definitions.

As used in NRS 693A.550 to 693A.665, inclusive, unless the context otherwise requires, the words and terms defined in NRS 693A.555 to 693A.570, inclusive, have the meanings ascribed to them in those sections.

Nev. Rev. Stat. § 693A.555 Intermediate stock holding company defined.

Intermediate stock holding company means a holding company of which at least a majority of the voting securities are owned by a mutual insurance holding company and which directly owns all the voting securities of a reorganized stock insurer.

Nev. Rev. Stat. § 693A.560 Mutual insurance holding company defined.

Mutual insurance holding company means a holding company based on a mutual plan which at all times owns a majority of the voting securities of a single intermediate stock holding company or, if no such intermediate stock holding company exists, which owns a majority of the voting securities of a reorganized stock insurer.

Nev. Rev. Stat. § 693A.565 Reorganized stock insurer defined.

Reorganized stock insurer means a stock insurer subsidiary that results from a reorganization of a domestic mutual insurer pursuant to NRS 693A.550 to 693A.665, inclusive.

Nev. Rev. Stat. § 693A.570 Voting securities defined.

Voting securities means securities of any class or any ownership interest having voting power for the election of directors, trustees or management, other than securities having voting power only because of the occurrence of a contingency.

Nev. Rev. Stat. § 693A.575 Procedure for reorganization.

A domestic mutual insurer may, by complying with NRS 693A.550 to 693A.665, inclusive, and obtaining the approval of the Commissioner, reorganize by: 1. Merging the membership interests of its policyholders into: (a) A mutual insurance holding company formed for the purpose of the reorganization; or (b) An existing mutual insurance holding company; and 2. Continuing the corporate existence of the mutual insurer as a stock insurer subsidiary of the mutual insurance holding company.

Nev. Rev. Stat. § 693A.580 Proposed plan of reorganization: Filing and contents; filing fee.

A domestic mutual insurer shall file with the Commissioner for review and approval a proposed plan of reorganization that has been approved by a vote of not less than two-thirds of the members of the board of directors of the domestic mutual insurer. The proposed plan of reorganization must be accompanied by a nonrefundable fee of $2,450. The plan of reorganization must include: 1. An analysis of the benefits and risks of the proposed reorganization, including, without limitation, the rationale and comparative benefits and risks of converting to a domestic stock insurer pursuant to NRS 693A.400 to 693A.540 , inclusive; 2. A statement of how the plan is fair and equitable to the policyholders; 3. Information sufficient to demonstrate that the financial condition of the mutual insurer will not be diminished upon reorganization; 4. Provisions to ensure immediate membership in the mutual insurance holding company for all existing policyholders of the mutual insurer; 5. Provisions for membership interests for future policyholders of the reorganized stock insurer; 6. Provisions to ensure that, in the event of proceedings for rehabilitation or liquidation involving a stock insurer subsidiary of the mutual insurance holding company, the assets of the mutual insurance holding company will be available to satisfy the obligations of the stock insurer subsidiary to policyholders; 7. Provisions for the periodic distribution of the accumulated earnings of the mutual insurance holding company; 8. Certified copies of the proposed articles of incorporation and bylaws of the mutual insurance holding company, intermediate stock holding company and reorganized stock insurer, or proposed amendments thereto as necessary to carry out the reorganization; 9. A certification that the plan of reorganization has been duly adopted by a vote of not less than two-thirds of the members of the board of directors of the mutual insurer; 10. A certification adopted by not less than two-thirds of the members of the board of directors of the mutual insurer that the plan of reorganization is fair and equitable to the policyholders; 11. The names, addresses and occupations of all persons who are or have been selected to become directors or officers of the mutual insurance holding company; 12. A description of the nature and content of the annual report and financial statement to be sent by the mutual insurance holding company to each policyholder; 13. The number of members of the board of directors of the mutual insurance holding company who are required to be policyholders; 14. A description of any plans for the initial sale of stock of the intermediate stock holding company or reorganized stock insurer; 15. A form of the proposed notice to be mailed by the mutual insurer to its policyholders as required by NRS 693A.595 ; and 16. Such additional information as the Commissioner may by regulation prescribe as necessary or appropriate for the protection of policyholders and security holders of the domestic mutual insurer or for the protection of the public interest.

Nev. Rev. Stat. § 693A.585 Public hearing on proposed plan.

Unless the Commissioner, for good cause, extends the time, the Commissioner shall conduct a public hearing regarding a proposed plan of reorganization not later than 120 days after the date on which the completed proposed plan of reorganization is filed pursuant to NRS 693A.580. Any interested person may appear or otherwise be heard at the public hearing. The Commissioner may continue the public hearing for a reasonable period, not to exceed 60 days. The mutual insurer shall give such reasonable notice of the public hearing as the Commissioner requires.

Nev. Rev. Stat. § 693A.590 Action by Commissioner on proposed plan; notice and expiration of approval.

1. The Commissioner shall issue an order approving or disapproving a proposed plan of reorganization not later than 30 days after the public hearing required by NRS 693A.585 . 2. The Commissioner shall not approve a proposed plan of reorganization unless the Commissioner finds that the: (a) Plan of reorganization is fair and equitable to the policyholders; (b) Plan of reorganization does not deprive the policyholders of their property rights or due process of law; (c) Reorganized stock insurer meets the minimum requirements for a certificate of authority to transact the business of insurance in this state; and (d) Continued operation of the reorganized stock insurer is not hazardous to future policyholders and the public. 3. If the Commissioner approves a plan of reorganization, the Commissioner shall publish notification of the issuance of the order in a newspaper of general circulation in Carson City and in the county of domicile of the mutual insurer if different from Carson City. 4. If the Commissioner approves a plan of reorganization, the approval expires if the reorganization is not completed within 180 days after the date of approval, unless the period is extended by the Commissioner for good cause. 5. If the Commissioner disapproves a plan of reorganization, the Commissioner shall issue an order setting forth specific findings for the disapproval.

Nev. Rev. Stat. § 693A.595 Meeting and vote of policyholders; notice.

1. Within 45 days after the date of the Commissioners approval of a plan of reorganization pursuant to NRS 693A.590 , unless extended by the Commissioner for good cause, the mutual insurer shall hold a meeting of its policyholders at a reasonable time and place to vote upon the plan of reorganization. The mutual insurer shall give notice not less than 30 days before the meeting, by first-class mail to the last known address of each policyholder, that the plan of reorganization will be voted upon at a regular or special meeting of the policyholders. The notice must include a brief description of the plan of reorganization, a statement that the Commissioner has approved the plan of reorganization, and a written proxy permitting the policyholder to vote for or against the plan of reorganization. For the purposes of notice and voting, the policyholder of a policy of group insurance is the entity to which the group policy is issued and not any person covered under the group policy. A plan of reorganization is approved only if not less than two-thirds of the policyholders voting in person or by proxy at the meeting vote in favor of the plan of reorganization. Each policyholder is entitled to only one vote regardless of the number of policies owned by the policyholder. The Commissioner shall supervise and direct the conducting of the vote on the plan of reorganization as necessary to ensure that the vote is fair and consistent with the requirements of this section. 2. If a mutual insurer complies substantially and in good faith with the notice requirements of this section, the mutual insurers failure to give any policyholder the required notice does not impair the validity of any action taken pursuant to this section. 3. If the meeting of policyholders to vote upon the plan of reorganization is held coincident with the mutual insurers annual meeting of policyholders, only one combined notice of meeting is required. 4. The form of any proxy must be filed with and approved by the Commissioner. 5. For the purposes of notice and voting, a person is not a policyholder unless the person was a policyholder of the mutual insurer on the date on which the plan of reorganization was initially approved by the board of directors of the mutual insurer.

Nev. Rev. Stat. § 693A.600 Abandonment of plan of reorganization.

A mutual insurer may, by not less than a two-thirds vote of the members of its board of directors and with the approval of the Commissioner, abandon a plan of reorganization at any time before the issuance of the certificate of authority by the Commissioner pursuant to NRS 693A.605. Upon abandonment, all rights and obligations arising out of the plan of reorganization terminate and the mutual insurer shall continue to conduct its business as a domestic mutual insurer as though no plan of reorganization had ever been adopted.

Nev. Rev. Stat. § 693A.605 Issuance and effect of certificate of authority.

1. The Commissioner shall issue a certificate of authority to a reorganized stock insurer when the mutual insurer files with the Commissioner a: (a) Certificate stating that all the conditions set forth in the plan of reorganization have been satisfied, so long as the board of directors of the mutual insurer has not abandoned the plan of reorganization pursuant to NRS 693A.600 . (b) Certificate from the mutual insurer setting forth the vote and certifying that the plan of reorganization was approved by not less than two-thirds of the policyholders voting in person or by proxy on the plan of reorganization. 2. The reorganization is effective upon the issuance of a certificate of authority by the Commissioner. 3. Upon issuance of the certificate of authority, the articles of incorporation of the mutual insurer shall be deemed to be amended in compliance with NRS 692B.030 .

Nev. Rev. Stat. § 693A.610 Authority of Commissioner to engage services of experts; payment of costs to review plan of reorganization.

In determining whether a plan of reorganization meets the requirements of the provisions of NRS 693A.550 to 693A.665, inclusive, or with regard to any other matters relating to the development of a plan of reorganization, the Commissioner may engage the services of experts. All reasonable costs related to the review of a plan of reorganization or such other matters, including those costs attributable to the use of experts, must be paid by the mutual insurer filing the application or initiating discussions with the Commissioner about such matters.

Nev. Rev. Stat. § 693A.615 Confidentiality and publication of pertinent information and documents.

1. Except as otherwise provided in subsection 2 and NRS 239.0115 , all information and documents obtained by or disclosed to the Commissioner or any other person in the course of preparing, filing and processing an application to reorganize pursuant to NRS 693A.580 , other than information and documents distributed to policyholders in connection with the meeting of policyholders pursuant to NRS 693A.595 or filed or submitted as evidence in connection with the public hearing pursuant to NRS 693A.585 , are confidential and not subject to subpoena, and must not be made public by the Commissioner, the National Association of Insurance Commissioners or any other person, except to insurance departments of other states, without the prior written consent of the insurer to which such information and documents pertain. 2. If the Commissioner, after giving the insurer and its affiliates who would be affected notice and opportunity to be heard, determines that the interests of policyholders, shareholders or the public will be best served by the publication of such information and documents, the Commissioner may publish all or any part thereof in such a manner as the Commissioner determines appropriate.

Nev. Rev. Stat. § 693A.620 Continuation of corporate existence of mutual insurer.

The corporate existence of a mutual insurer reorganizing pursuant to NRS 693A.550 to 693A.665, inclusive, does not terminate, and the reorganized stock insurer shall be deemed to be a continuation of the mutual insurer and to have been organized on the date on which the mutual insurer was originally organized.

Nev. Rev. Stat. § 693A.625 Issuance of initial shares of capital stock; identity and rights of policyholders; status, rights, duties and assets of holding company.

1. All the initial shares of the capital stock of a reorganized stock insurer must be issued to the mutual insurance holding company or to one or more intermediate stock holding companies. 2. Policyholders of a domestic mutual insurer that has been reorganized are members of the mutual insurance holding company, and their voting rights must be determined in accordance with the articles of incorporation and bylaws of the mutual insurance holding company. The mutual insurance holding company shall provide its members with the same membership rights as were provided to policyholders of the mutual insurer immediately before reorganization. The reorganization must not reduce, limit or otherwise affect the number or identity of the policyholders who may become members of the mutual insurance holding company or secure for managerial personnel any unfair advantage through or connected with the reorganization. 3. A mutual insurance holding company or an intermediate stock holding company formed pursuant to NRS 693A.550 to 693A.665 , inclusive: (a) Must not be authorized to transact the business of insurance; (b) Is subject to the jurisdiction of the Commissioner, who shall ensure that policyholder interests are protected; and (c) Shall be deemed to be an insurer for the purposes of chapter 696B of NRS. 4. An intermediate stock holding company formed pursuant to NRS 693A.550 to 693A.665 , inclusive, shall be deemed to be a mutual insurance holding company subject to the provisions of NRS 693A.400 to 693A.540 , inclusive. 5. A mutual insurance holding company formed pursuant to NRS 693A.550 to 693A.665 , inclusive: (a) Shall not issue stock. (b) Shall invest in insurers not less than 50 percent of its net worth as determined by generally accepted accounting practices. 6. The aggregate pledges and encumbrances of the assets of a mutual insurance holding company must not affect more than 49 percent of the mutual insurance holding companys stock in an intermediate stock holding company or a reorganized stock insurer. 7. If any proceeding under chapter 696B of NRS is brought against a reorganized stock insurer, the mutual insurance holding company and each intermediate stock holding company must be named parties to the proceeding. All the assets of the mutual insurance holding company and each intermediate stock holding company shall be deemed assets of the estate of the reorganized stock insurer to the extent necessary to satisfy claims against the reorganized stock insurer. 8. No distribution to members of a mutual insurance holding company may occur without the prior written approval of the Commissioner. The Commissioner may give such approval only if the Commissioner is satisfied that the distribution is fair and equitable to policyholders as members of the mutual insurance holding company. 9. No solicitation for the sale of the stock of an intermediate stock holding company or a reorganized stock insurer may be made without the prior written approval of the Commissioner. 10. A mutual insurance holding company or an intermediate stock holding company may not voluntarily dissolve without the approval of the Commissioner.

Nev. Rev. Stat. § 693A.630 Conversion of mutual insurance holding company to domestic stock insurance company not prohibited.

Nothing contained in NRS 693A.550 to 693A.665, inclusive, prohibits a mutual insurance holding company from converting to a domestic stock insurance company pursuant to NRS 693A.400 to 693A.540, inclusive.

Nev. Rev. Stat. § 693A.635 Membership interest in mutual insurance holding company is not security.

A membership interest in a mutual insurance holding company does not constitute a security under the laws of this state.

Nev. Rev. Stat. § 693A.640 Receipt of fee, commission or other consideration for aiding, promoting or assisting in plan of reorganization.

1. No director, officer, employee or agent of the mutual insurer, or any other person, may receive any fee, commission or other valuable consideration, other than his or her usual regular salary and compensation, for aiding, promoting or assisting in a plan of reorganization except as set forth in the plan of reorganization approved by the Commissioner. 2. Subsection 1 does not prohibit a management or employee incentive compensation program that is contained in the plan of reorganization and approved by the Commissioner to be adopted upon reorganization to the reorganized stock insurer or prohibit such a program to be adopted later by the reorganized stock insurer. 3. Subsection 1 does not prohibit the payment of reasonable fees and compensation to attorneys, accountants, actuaries and investment bankers for services performed in the independent practice of their professions if the person is also a member of the board of directors of the mutual insurer.

Nev. Rev. Stat. § 693A.645 Mutual insurance holding company: Annual filing requirements.

1. A mutual insurance holding company shall file with the Commissioner, by March 1 of each year, an annual statement consisting of an income statement, balance sheet and cash flows prepared in accordance with generally accepted accounting practices and a confidential statement disclosing any intention to pledge, borrow against, alienate, hypothecate or in any way encumber the assets of the mutual insurance holding company. 2. A mutual insurance holding company shall, on or before June 1 of each year, file with the Commissioner in a form approved by the Commissioner a financial statement as of December 31 of the preceding calendar year that is certified by a certified public accountant.

Nev. Rev. Stat. § 693A.650 Mutual insurance holding company: Production of records, books or other information and papers.

The Commissioner may order the production of any records, books or other information and papers in the possession of a mutual insurance holding company or its affiliates as is reasonably necessary to ascertain the financial condition of the reorganized stock insurer or to determine compliance with this title.

Nev. Rev. Stat. § 693A.655 Regulations and orders of Commissioner.

The Commissioner may adopt such regulations and issue such orders as the Commissioner determines are necessary to carry out the provisions of NRS 693A.550 to 693A.665, inclusive.

Nev. Rev. Stat. § 693A.660 Judicial review of final order of Commissioner.

Any person aggrieved by a final order of the Commissioner issued pursuant to the provisions of NRS 693A.550 to 693A.665, inclusive, may petition for judicial review in the manner provided by chapter 233B of NRS.

Nev. Rev. Stat. § 693A.665 Enforcement of provisions by Commissioner.

Whenever it appears to the Commissioner that any person or any director, officer, employee or agent of the person has committed or is about to commit a violation of any provision of NRS 693A.550 to 693A.665, inclusive, or of any regulation or order of the Commissioner relating thereto, the Commissioner may apply to the First Judicial District Court in and for Carson City for an order enjoining the person, director, officer, employee or agent from violating or continuing to violate any provision of NRS 693A.550 to 693A.665, inclusive, or any such regulation or order, and for such other equitable relief as the nature of the case and the interest of the policyholders, creditors and shareholders of the insurer, or the public, may require.

Source: NV Statutes (Official Site)URL: https://www.leg.state.nv.us/nrs/NRS-693A.htmlFetched: 10/4/2026