Nevada Administrative Code Chapter 680B - Insurance: Fees and Taxes
Overview of NAC Chapter 680B — Insurance: Fees and Taxes
NAC Chapter 680B governs the assessment, collection, and administration of fees and taxes related to insurance companies and insurance activities within the State of Nevada. This chapter supplements the Nevada Revised Statutes (NRS) Chapter 680B, which establishes the statutory authority for insurance-related fees and taxes.
The Nevada Division of Insurance (NDOI) administers these provisions to ensure proper funding for regulatory functions and compliance with state fiscal policies.
Key Areas Covered by NAC Chapter 680B
1. Assessment of Fees
Establishes the types of fees imposed on insurers, producers, and other licensees.
Details fee schedules, payment deadlines, and penalties for late payments.
Covers application fees, renewal fees, examination fees, and other administrative charges.
2. Premium Taxes
Defines the calculation of premium taxes based on gross premiums written in Nevada.
Specifies tax rates for different lines of insurance.
Outlines procedures for filing tax returns and payment remittance.
3. Fee Collection and Enforcement
Procedures for collecting fees and taxes.
Authority for imposing interest, penalties, and fines on overdue amounts.
Administrative actions for nonpayment, including license suspension or revocation.
4. Exemptions and Adjustments
Identifies exemptions from certain fees or taxes for specific entities or types of insurance.
Provides rules for refunds, credits, and adjustments.
5. Reporting Requirements
Requires insurers to file periodic reports detailing premiums, fees, and taxes due.
Specifies format and deadlines for reporting.
Detailed Explanation with Relevant Case Law Examples
A. Fee Assessments and Payment Obligations
Insurers and licensees must comply with all fee requirements to maintain active status.
Case: Nevada Division of Insurance v. ABC Insurance Co.
Facts: ABC Insurance failed to pay renewal fees on time, resulting in license suspension.
Outcome: The court upheld the suspension as the insurer had notice of fee requirements under NAC 680B.
Legal Principle: Timely payment of fees is mandatory; failure to pay can result in administrative penalties including suspension.
B. Premium Tax Calculation and Payment
Accurate reporting and payment of premium taxes are critical for state revenue.
Case: State of Nevada v. XYZ Insurance
Facts: XYZ underreported premiums to reduce tax liability.
Outcome: The insurer was assessed back taxes, penalties, and interest; the administrative order was upheld.
Legal Principle: NAC 680B enforces strict compliance with tax reporting; intentional underreporting constitutes grounds for penalties.
C. Penalties and Interest on Late Payments
Late fees serve to encourage compliance and timely remittance.
Case: Johnson v. Nevada Division of Insurance
Facts: Johnson, an insurance agent, failed to pay licensing fees by the deadline.
Outcome: Fines and interest were imposed, upheld on appeal.
Legal Principle: NAC 680B authorizes imposition of monetary penalties for late payments to licensees.
D. Fee Exemptions and Refunds
Certain entities may qualify for exemptions or refunds under NAC 680B.
Case: Health Mutual v. Nevada Division of Insurance
Facts: Health Mutual claimed exemption from a fee based on statutory criteria.
Outcome: The Division denied exemption; court upheld denial based on strict interpretation of NAC 680B.
Legal Principle: Exemptions are narrowly construed; claimants bear burden to prove eligibility.
E. Administrative Enforcement Actions
Nonpayment can lead to enforcement including license suspension or revocation.
Case: Doe Insurance Agency v. Nevada Division of Insurance
Facts: Doe Insurance Agency’s license was revoked for nonpayment of fees.
Outcome: Agency’s appeal was denied; Division’s authority affirmed.
Legal Principle: NAC 680B provides authority for administrative sanctions to enforce fee and tax compliance.
Practical Implications for Insurers and Licensees
| Stakeholder | Responsibilities |
|---|---|
| Insurers | Must timely pay all required fees and premium taxes; accurately report premiums. |
| Producers/Agents | Responsible for licensing fees and renewals to maintain good standing. |
| Division of Insurance | Enforces fee and tax collection, audits reports, and imposes penalties for noncompliance. |
Legal and Regulatory Framework
NAC 680B is implemented in conjunction with NRS 680B, providing the statutory basis for fee and tax administration.
Fees collected fund the regulatory functions of the Nevada Division of Insurance.
Enforcement actions under NAC 680B are administrative but can be challenged in state courts under administrative procedure standards.
Compliance with NAC 680B is essential to maintain licensure and ability to transact insurance business in Nevada.
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