Nevada Administrative Code Chapter 690B - Casualty Insurance
🛡️ Nevada Administrative Code Chapter 690B — Casualty Insurance
🔹 Overview
NAC Chapter 690B sets out the regulations governing casualty insurance in Nevada. Casualty insurance broadly covers policies that protect insured parties from liability or loss from accidents, injuries, or damage to persons or property.
Common types of casualty insurance include:
Auto liability insurance
General liability insurance
Workers’ compensation
Other liability coverages
NAC 690B implements the provisions of the Nevada Revised Statutes (NRS) Chapter 686, which regulates insurance practices, and ensures that casualty insurers comply with licensing, policy standards, claims handling, and reporting requirements.
🔹 Key Provisions of NAC Chapter 690B
1. Licensing and Authority
Insurers must be licensed by the Nevada Division of Insurance to transact casualty insurance in Nevada.
Companies must file their forms and rates for approval with the Division.
2. Policy Form Requirements
All casualty insurance policies issued in Nevada must comply with state law.
Policies should clearly specify coverage, exclusions, limits, and conditions.
Certain mandatory policy provisions may be required, such as clear definitions of coverage or cancellation rights.
3. Claims Handling Procedures
Insurers must follow fair claims practices:
Prompt investigation,
Timely payment or denial,
Proper communication with claimants,
Avoidance of unfair claims settlement practices.
The NAC may specify timeframes and procedures for claim acknowledgments and decisions.
4. Rate Filing and Approval
Casualty insurance rates often must be filed with and approved by the Division of Insurance.
Rates must not be excessive, inadequate, or unfairly discriminatory.
5. Reporting and Record Keeping
Insurers must maintain records of policies, claims, and underwriting.
They must file periodic reports with the Division.
6. Enforcement and Penalties
The Division of Insurance has authority to investigate violations.
Penalties may include fines, license suspension, or revocation.
⚖️ Relevant Case Law Principles
Nevada courts have interpreted and applied casualty insurance laws in various disputes, touching on regulatory compliance, policy interpretation, and insurer duties.
âś… 1. Interpretation of Insurance Policies
Principle:
Nevada courts apply plain meaning to policy language but construe ambiguities in favor of the insured. This often arises in casualty insurance claims where coverage issues are contested.
✅ 2. Insurer’s Duty of Good Faith and Fair Dealing
Principle:
Casualty insurers owe a duty to act in good faith toward insureds and claimants. Bad faith includes unreasonable denial or delay of claims.
Example:
If an insurer unreasonably denies a liability claim, the insured may sue for bad faith, potentially recovering damages beyond the policy limits.
âś… 3. Fair Claims Practices Regulations
Principle:
Failure to comply with NAC or NRS claims handling requirements can be evidence of bad faith or unfair trade practice under Nevada law.
âś… 4. Regulatory Authority Over Rates and Forms
Principle:
Courts generally uphold the Division’s discretion to approve or reject rates and policy forms, as long as decisions are within statutory authority.
âś… 5. Enforcement Actions and Administrative Review
Principle:
Insurers penalized by the Division for violations can seek administrative review and judicial appeal, but courts defer to the Division’s expertise unless action is arbitrary or capricious.
🔎 Hypothetical Example
An auto insurer denies a liability claim citing a policy exclusion.
The insured sues, arguing the exclusion is ambiguous.
The court finds the language unclear and rules in favor of the insured, interpreting the exclusion against the insurer.
Separately, the insurer is investigated by the Division for slow claim handling and fined under NAC rules.
đź“Ś Summary Table
| Aspect | Explanation |
|---|---|
| Scope | Regulation of casualty insurance licensing, forms, claims, rates |
| Claims Handling | Requires prompt, fair investigation and resolution of claims |
| Policy Interpretation | Ambiguities resolved in favor of insured |
| Bad Faith | Insurers must act in good faith; violations may lead to damages |
| Regulatory Review | Division oversees rate/form approval and enforces compliance |
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