NAC695D.300. Maintenance of financial security.

     1. An organization shall maintain:

     (a) A capital account with a net worth in an amount which is the greater of:

          (1) The amount of risk-based capital determined in the manner set forth in NRS 681B.290 and the regulations adopted pursuant thereto; or

          (2) The amount, according to the number of members in the organization, that is not less than the following amounts:

             Number of Members                     Net Worth

                 Less than 2,500                            $50,000

                 2,500 to 5,000                              $75,000

                 5,000 or more                             $125,000

     (b) Except as otherwise provided in this paragraph, a surety bond or deposit of cash or securities for the protection of members of not less than the amount required by NRS 695D.170. The Commissioner will allow the bond or deposit to be reduced to $125,000 until the organization has 5,000 members.

     (c) Blanket fidelity coverage issued by an authorized insurer in an amount of not less than $1,000,000.

     (d) A contract of insurance providing that, in the event the organization is declared insolvent by the Division or a court of competent jurisdiction, the insurer will pay all claims made by a member from the first dollar of eligible expenses for a period of not less than 60 days. If this coverage is cancelled, written notice of the cancellation must be given to the Division by the organization and its insurer not less than 90 days before the cancellation becomes effective. The insurer may require the organization to include in its agreements with its providers, a requirement that the provider accept any assignment made by the organization to the insurer for the continuation of benefits upon the insolvency of the organization.

     (e) A contract of insurance to stop the losses of the organization, in an amount acceptable to the Commissioner.

     2. The reserves required by NRS 695D.250 must be segregated in a trust fund located in a federally insured financial institution in this State. Any interest earned on the fund may be credited to the organization.

     (Added to NAC by Comm’r of Insurance, eff. 12-2-88; A 5-27-92; R005-03, 2-12-2004; R249-03, 11-12-2004)