NRS 692C.357 Domestic insurer under control of foreign person not relieved of obligations and liabilities; requirements for board of directors of registered domestic insurer; exception; waiver.

559 words·~3 min read·/nv/chapter-692c-holding-companies/692c-357·

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

1. If a domestic insurer is under the control of a foreign person, the officers and directors of the domestic insurer are not relieved of any obligations or liabilities to which they are subject by law. The domestic insurer must be managed in a manner that ensures its separate operating identity.

2. The provisions of this section do not prohibit a registered domestic insurer and one or more other persons from having or sharing common management, participating as a cooperative or sharing employees, property or services in a manner authorized under NRS 692C.360 .

3. Except as otherwise provided in subsections 6 and 7, at least one person in any quorum for the transaction of business at any meeting of the board of directors of a registered domestic insurer or any committee thereof must be a person who is not:

(a)An officer or employee of the domestic insurer or of any entity controlling, controlled by or under common control with the domestic insurer; or

(b)A beneficial owner of a controlling interest in the voting stock of the domestic insurer or entity.

4. Except as otherwise provided in subsections 6 and 7, not less than one-third of the members of the board of directors of a registered domestic insurer and not less than one-third of the members of each committee of the board of directors of any registered domestic insurer must be persons described in subsection 3.

5. Except as otherwise provided in subsections 6 and 7, the board of directors of a registered domestic insurer shall establish one or more committees consisting solely of persons described in subsection 3. Each committee shall:

(a)Nominate candidates for director for election by shareholders or policyholders;

(b)Evaluate the performance of each principal officer of the registered domestic insurer; and

(c)Make recommendations to the board of directors concerning the selection and compensation of each of those principal officers.

6. The provisions of subsections 3, 4 and 5 do not apply to a registered domestic insurer if the registered domestic insurer is controlled by an entity and the board of directors of the controlling entity and the committees thereof meet the requirements of subsections 3, 4 and 5.

7. A registered domestic insurer may apply to the Commissioner for a waiver of the provisions of this section if the registered domestic insurer has:

(a)Annual direct written and assumed premiums of less than $300,000,000, excluding any premiums reinsured with:

(1)The Federal Crop Insurance Corporation of the Risk Management Agency of the United States Department of Agriculture; and

(2)The National Flood Insurance Program of the Federal Emergency Management Agency of the United States Department of Homeland Security; or

(b)In any other circumstances determined by the Commissioner to warrant a waiver.

8. In considering whether or not to grant a waiver pursuant to subsection 7, the Commissioner may consider any relevant factors, including, without limitation:

(a)The type of business entity applying for the waiver;

(b)The volume of business written;

(c)The availability of persons specified in subsection 3 to serve on the board of directors; and

(d)The ownership or organizational structure of the registered domestic insurer or controlling person thereof.