Nevada Gov. Jim Gibbons has signed a bill that will change the funding structure of the Nevada Division of Insurance and strengthen consumer protections in the area of viatical settlements.
The bill, Senate Bill 426, passed May 22 in the state Assembly with a 37-5 vote. It moves the funding of the Division of Insurance from the state’s General Fund to a newly created fund for Insurance Administration and Enforcement, allowing the Division to completely rely on a fee-based funding structure widely supported by the state’s insurance industry.
“Under this new funding method, the Division will not be subjected to the whims of the economy,” Nevada Insurance Commissioner Scott J. Kipper said. “It will allow the Division to add the necessary staff to continue to adequately regulate Nevada’s insurance business, a $12 billion industry in the state.”
SB426 also revises provisions regarding viatical settlements, consistent with the National Association of Insurance Commissioners Model Act. The bill:
- Establishes a five-year waiting period to viaticate a life insurance policy, except in certain specific circumstances;
- Improves accountability and transparency by requiring additional notices and disclosures;
- Enhances advertising and marketing guidelines for viatical and life settlement products; and
- Regulates the securities side of viatical/life settlement transactions through the Office of the Secretary of State.
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