Section 681B.480 - Formula for completion of report1. The report on risk-based capital of an insurer n insurer or health organization must be completed in accordance with the formula set forth in the instructions relating to risk-based capital and in accordance with the following provision: (a) A life and health insurer's level of risk- based capital must be determined in accordance with the formula set forth in the instructions relating to risk-based capital for life and health insurers. The formula must take into account, and may adjust for, the covariance between the following factors, determined in each case by applying the factors in the manner set forth in the instructions relating to risk-based capital for life and health insurers: (1) The risk with respect to the insurer's assets;(2) The risk of adverse insurance experience with respect to the insurer's liabilities and obligations;(3) The interest rate risk with respect to the insurer's business; and(4) All other business risks and any additional relevant risks identified in the instructions relating to risk-based capital for life and health insurers.(b) A property and casualty in surer's level of risk-based capital must be determined in accordance with the formula set forth in the instructions relating to risk-based capital for property and casualty insurers. The formula must take into account, and may adjust for, the covariance between the following factors, determined in each case by applying the factors in the manner set forth in the instructions relating to risk-based capital for property and casualty insurers: (3) Underwriting risk; and(4) All other business risks and any additional relevant risks identified in the instructions relating to risk-based capital for property and casualty insurers(c) A health organization's level of risk-based capital must be determined in accordance with the formula set forth in the instructions relating to risk-based capital for health organizations. The formula must take into account, and may adjust for, the covariance between the following factors, determined in each case by applying the factors in the manner set forth in the instructions relating to risk-based capital for health organizations: (3) Underwriting risk; and(4) All other business risks and any additional relevant risks identified in the instructions relating to risk-based capital for health organizations.(d) A fraternal benefit society's level of risk-based capital must be determined in accordance with the formula set forth in the instructions relating to risk-based capital for fraternal benefit societies. The formula must take into account, and may adjust for, the covariance between the following factors, determined in each case by applying the factors in the manner set forth in the instructions relating to risk-based capital for fraternal benefit societies: (1) The risk with respect to the assets of the fraternal benefit society;(2) The risk of adverse insurance experience with respect to the liabilities and obligations of the fraternal benefit society;(3) The interest rate risk with respect to the business of the fraternal benefit society; and(4) All other business risks and any additional re levant risks identified in the instructions relating to risk-based capital for fraternal benefit societies.2. In addition to meeting the applicable level of risk-based capital required by this section, an insurer or health organization should maintain an amount of capital in excess of the level of risk-based capital required by this section or any other regulation adopted pursuant to NRS 681B.290, as amended by section 6 of Assembly Bill No. 435, Statutes of Nevada 2013, at page 3354, to avoid various risks inherent in or affecting the business of insurance.Nev. Admin. Code § 681B.480
Added to NAC by Comm'r of Insurance by R088-97, eff. 3-19-98; A by R132-13, eff. 10/1/2014