NAC690A.185. Audits of payments for claims and reviews of accounts for creditors.

     1. Each insurer who engages in the business of credit insurance in this State shall conduct:

     (a) An annual audit of all payments for claims made on its behalf by an administrator, claim representative or group policyholder.

     (b) A review of each of its accounts for creditors with respect to the business of credit insurance of the creditor to ensure compliance with the Nevada Insurance Code and the regulations adopted pursuant thereto. The initial review must be conducted not later than March 1, 2008, or the date of the initial credit transaction between the creditor and the insurer, whichever is later. After the initial review, the review must be conducted every 24 months.

     2. The audit or review must include, if applicable, a determination that:

     (a) The proper charges to debtors for premiums are made by the creditor and remitted to the insurer in a timely manner.

     (b) The refunds are being calculated accurately and paid promptly by the creditor.

     (c) All claims and inquiries concerning claims are filed promptly and handled properly.

     (d) Amounts of insurance payable on death, in excess of the amounts necessary to extinguish the indebtedness, are properly calculated and reported to the secondary beneficiary of the policy.

     (e) The creditor is promptly and fairly processing complaints concerning its business of credit insurance and is maintaining proper procedures for and records of the complaints processed.

     3. The insurer shall retain the written results of the audit or review at its home office for at least 7 years after the date of the completion of the audit or review by the insurer.

     4. The insurer shall pay the cost of the audit or review, and the cost may not be chargeable against any creditor, producer or other entity.

     5. In addition to any other authority granted to the Commissioner pursuant to chapter 679B of NRS, if the Commissioner determines that an audit or review required pursuant to this section is not being conducted or that there is reason to believe that the audit or review is not complete or is deficient, the Commissioner may cause an audit or review to be conducted by the Division of Insurance of the Department of Business and Industry or an independent auditor. The insurer shall pay the cost of the audit or review.

     (Added to NAC by Comm’r of Insurance by R014-06, 3-23-2007, eff. 4-1-2007)