Grounds for conservation or rehabilitation of domestic insurer or domiciled alien insurer. The Commissioner may petition for an order directing him to conserve the assets of or to rehabilitate a domestic insurer or an alien insurer domiciled in this state on any one or more of the following grounds:
1. On any ground for liquidation of the insurer under NRS 696B.220, if the Commissioner believes conservation or rehabilitation possible without substantial increase of risk to creditors, policyholders or the public;
2. If the insurer is in unsound condition, or is using, or has been subject to such methods and practices in the conduct of its business as to render its further transaction of insurance presently or prospectively hazardous to its policyholders, or creditors, or the public;
3. If the insurer’s solvency is endangered by illegal action;
4. For material falsification of the insurer’s records, reports or financial condition;
5. If the Commissioner finds after hearing that any individual exercising executive power with respect to or otherwise materially influencing or controlling the insurer, directly or indirectly, is dishonest or untrustworthy in matters affecting the insurer, and has not been or cannot effectively and permanently be removed from such power, influence or control;
6. For unlawful concealment or removal by the insurer of any of its records or assets;
7. For failure of the insurer, or its parent corporation, or subsidiary or affiliated person controlled by the insurer, to submit its books, accounts, records and affairs to the reasonable inspection or examination of the Commissioner or his examiner as authorized under this Code;
8. If any individual exercising any executive authority in the affairs of the insurer, or parent corporation, or subsidiary or affiliated person has refused to be examined under oath, by the Commissioner or his examiner thereunto duly authorized, whether within this state or otherwise, concerning the pertinent affairs of the insurer, or parent corporation, or subsidiary, or affiliated person, or if examined under oath refuses to divulge pertinent information reasonably known to him;
9. For failure of officers, employees and other representatives of the insurer, or parent corporation, or subsidiary, or affiliated person to comply promptly with the reasonable requests of the Commissioner or his examiner for the purposes of and during the conduct of any examination;
10. That a deadlock exists in the insurer’s board of directors relative to the general management of the insurer’s affairs, that the insurer’s stockholders or members (as to a mutual insurer) are unable to break the deadlock, and that the same threatens irreparable injury to the insurer, or its creditors, or its policyholders, or to the public;
11. If the insurer has transferred or attempted to transfer substantially its entire property or business, or has entered into any transaction the effect of which is to merge or consolidate substantially its entire property or business in that of any other insurer, without first having obtained the written approval of the Commissioner as required under this Code;
12. If the controlling stock of the insurer has been transferred to others without compliance with the requirements of NRS 693A.320 (transfer of controlling stock), except where such transfer is by testamentary bequest or inheritance;
13. If the insurer has willfully violated its charter or a law of this state, or has willfully exceeded its corporate powers;
14. If the insurer has requested or consented to conservation or rehabilitation by a vote or written authorization of a majority of its directors, or stockholders, or members (as to mutual insurers); or
15. If the insurer has failed to pay any valid judgment against it within 30 days after the judgment became final.
Last modified: February 27, 2006