1. This chapter may be known and cited as the Group Life Insurance
Law.
2. This chapter applies only to group life insurance and wholesale
life insurance.
3. This chapter does not apply to any group life insurance
contract entered into or issued prior to January 1, 1972, or to any
extensions, renewals or modifications thereof or amendments thereto
whenever made.
(Added to NRS by 1971, 1746)
1. As used in this Code, “wholesale life insurance” is that plan
of life insurance, other than salary savings life insurance or pension
trust insurance and annuities, issued to:
(a) Three or more employees of any corporation, copartnership or
individual employer or any governmental corporation, agency or department
thereof; or
(b) Ten or more members, employees or employees of members of any
trade or professional association, or of a labor union, or of any
association of members in the same or related occupations, profession or
industry having had an active existence for at least 2 years, where such
association or union has a constitution or bylaws and is formed in good
faith for purposes other than that of obtaining insurance,
Ê where such persons, with or without their dependents are issued the
same form of an individual policy on the plan, varying only as to amounts
of coverage applied for by such persons and under an arrangement whereby
the premiums on such policies may be paid to the insurer periodically by
the employer, with or without payroll deductions, or by the insured or
association or union for its members, or by some designated person acting
on behalf of such employer, association or union. The term “employees” as
used in this section shall be deemed to include the officers, managers,
employees and retired employees of the employer and the individual
proprietor or partners if the employer is an individual or partnership.
2. Each policy issued under this section shall provide that the
coverage shall terminate when the insured individual no longer qualifies
for such policy under this section; but the policy may provide that it
may be continued in force or be replaced with another policy if the
premium, benefits and other relevant factors of the continued or
replacement policy are the same as those of a similar individual policy
not issued under or pursuant to this section.
(Added to NRS by 1971, 1746)
1. Except as otherwise provided in this section, no policy of
group life insurance may be delivered or issued for delivery in this
State to a group which was formed for the purpose of purchasing one or
more policies of group life insurance.
2. A policy of group life insurance may be delivered to a group
described in subsection 1 if the Commissioner approves the issuance. The
Commissioner must not grant his approval unless he finds that:
(a) The benefits of the policy are reasonable in relation to the
premiums charged; and
(b) The group to which the policy is issued is organized and
operated in a fiscally sound manner.
3. The provisions of subsection 1 do not apply to a policy of
group life insurance which is delivered or issued for delivery in this
State to a group whose members:
(a) Are related by blood, marriage or legal adoption;
(b) Have a common interest through ownership of a business
enterprise or a substantial legal interest or equity therein, and who are
actively engaged in the management thereof; or
(c) Otherwise have an insurable interest in each other’s lives.
4. An insurer may exclude or limit the coverage in a policy issued
pursuant to this section of any person as to whom evidence of
insurability is not satisfactory to the insurer.
5. The provisions of this section apply to the offering in this
State of a policy issued in another state.
(Added to NRS by 1971, 1747; A 1987, 118)
No policy of
group life insurance shall be delivered in this State unless it contains
in substance the provisions set forth in NRS 688B.040 to 688B.150 , inclusive, or provisions which in the
opinion of the Commissioner are more favorable to the persons insured, or
at least as favorable to the persons insured and more favorable to the
policyholder; except:
1. NRS 688B.100 to 688B.140
, inclusive, do not apply to policies
issued to a creditor to insure debtors of such creditor;
2. The standard provisions required for individual life insurance
policies do not apply to group life insurance policies; and
3. If the group life insurance policy is on a plan of insurance
other than the term plan, it shall contain a nonforfeiture provision or
provisions which in the opinion of the Commissioner is or are equitable
to the insured persons and to the policyholder; but nothing in this
subsection shall be construed to require that group life insurance
policies contain the same nonforfeiture provisions as are required for
individual life insurance policies.
(Added to NRS by 1971, 1747)
The group life insurance policy shall
contain a provision that the policyholder is entitled to a grace period
of 31 days for the payment of any premium due except the first, during
which grace period the death benefit coverage shall continue in force,
unless the policyholder has given the insurer written notice of
discontinuance in advance of the date of discontinuance and in accordance
with the terms of the policy. The policy may provide that the
policyholder shall be liable to the insurer for the payment of a pro rata
premium for the time the policy was in force during such grace period.
(Added to NRS by 1971, 1747)
The group life insurance policy
shall contain a provision that the validity of the policy shall not be
contested, except for nonpayment of premium, after it has been in force
for 2 years from its date of issue; and that no statement made by any
person insured under the policy relating to his insurability shall be
used in contesting the validity of the insurance with respect to which
such statement was made after such insurance has been in force prior to
the contest for a period of 2 years during such person’s lifetime nor
unless it is contained in a written instrument signed by him.
(Added to NRS by 1971, 1748)
The group life insurance policy shall contain a provision:
1. That a copy of the application, if any, of the policyholder
shall be attached to the policy when issued and become a part of the
contract;
2. That all statements made by the policyholder or by the persons
insured shall be deemed representations and not warranties; and
3. That no statement made by any person insured shall be used in
any contest unless a copy of the instrument containing the statement is
or has been furnished to such person or to his beneficiary.
(Added to NRS by 1971, 1748)
The group life insurance policy shall
contain a provision setting forth the conditions, if any, under which the
insurer reserves the right to require a person eligible for insurance to
furnish evidence of individual insurability satisfactory to the insurer
as a condition to part or all of his coverage.
(Added to NRS by 1971, 1748)
The group life insurance policy
shall contain a provision specifying an equitable adjustment of premiums
or of benefits or both to be made if the age of a person insured has been
misstated, such provision to contain a clear statement of the method of
adjustment to be used.
(Added to NRS by 1971, 1748)
The group life insurance policy
shall contain a provision that any sum becoming due by reason of the
death of the person insured shall be payable to the beneficiary
designated by the person insured, subject to the provision of the policy
if there is no designated beneficiary, as to all or any part of such sum,
living at the death of the person insured, and subject to any right
reserved by the insurer in the policy and set forth in the certificate to
pay at its option a part of such sum not exceeding $500 to any person
appearing to the insurer to be equitably entitled thereto by reason of
having incurred funeral or other expenses incident to the last illness or
death of the person insured.
(Added to NRS by 1971, 1748)
1. The group life policy shall contain a provision that the
insurer will issue to the policyholder for delivery to each person
insured a certificate setting forth a statement in summary form of the
essential features of the insurance coverage of such employee or member,
to whom benefits thereunder are payable, and the rights and conditions
set forth in NRS 688B.120 , 688B.130
and 688B.140 . If dependents are included in the coverage,
only one statement need be issued for each family unit.
2. The Commissioner may, in his discretion, require the form of
each such certificate proposed to be delivered in this state under a
group policy not made under the laws of this state, to be filed with him
by the insurer for informational purposes only.
(Added to NRS by 1971, 1749)
The group
life insurance policy shall contain a provision that if the insurance on
a person covered under the policy ceases because of termination of
employment or of membership in the class or classes eligible for coverage
under the policy, such person shall be entitled to have issued to him by
the insurer, without evidence of insurability, an individual policy of
life insurance without disability or other supplementary benefits,
provided application for the individual policy shall be made, and the
first premium paid to the insurer, within 31 days after such termination,
and provided further that:
1. The individual policy shall, at the option of such person, be
on any one of the forms, except term insurance, then customarily issued
by the insurer at the age and for the amount applied for;
2. The individual policy shall be in an amount not in excess of
the amount of life insurance which ceases because of such termination
less the amount of any life insurance for which such person is or becomes
eligible under the same or any other group policy within 31 days after
such termination, but any amount of insurance which has matured on or
before the date of such termination as an endowment payable to the person
insured, whether in one sum or in installments or in the form of an
annuity, shall not, for the purposes of this section, be included in the
amount which is considered to cease because of such termination; and
3. The premium on the individual policy shall be at the insurer’s
then customary rate applicable to the form and amount of the individual
policy, to the class of risk to which such person then belongs, and to
his age attained on the effective date of the individual policy.
(Added to NRS by 1971, 1749)
The group life
insurance policy shall contain a provision that if the group policy
terminates or is amended so as to terminate the insurance of any class of
insured persons, every person insured thereunder at the date of such
termination whose insurance terminates and who has been so insured for at
least 5 years prior to such termination date shall be entitled to have
issued to him by the insurer an individual policy of life insurance,
subject to the same conditions and limitations as are provided by NRS
688B.120 , except that the group
policy may provide that the amount of such individual policy shall not
exceed the smaller of:
1. The amount of the person’s life insurance protection ceasing
because of the termination or amendment of the group policy, less the
amount of any life insurance for which he is or becomes eligible under
any group policy issued or reinstated by the same or another insurer
within 31 days after such termination; and
2. $2,000.
(Added to NRS by 1971, 1750)
The group life insurance
policy shall contain a provision that if a person insured under the
policy dies during the period within which he would have been entitled to
have an individual policy issued to him in accordance with NRS 688B.120
or 688B.130 and before such an individual policy has
become effective, the amount of life insurance which he would have been
entitled to have issued to him under such individual policy shall be
payable as a claim under the group policy, whether or not application for
the individual policy or the payment of the first premium therefor has
been made.
(Added to NRS by 1971, 1750)
A policy issued to a creditor
to insure debtors of such creditor shall contain a provision that the
insurer will furnish to the policyholder for delivery to each debtor
insured under the policy a form which will contain a statement that the
life of the debtor is insured under the policy and that any death benefit
paid thereunder by reason of his death shall be applied to reduce or
extinguish the indebtedness.
(Added to NRS by 1971, 1750)
1. If any individual insured under a group life insurance policy
delivered in this state after January 1, 1972, becomes entitled under the
terms of such policy to have an individual policy of life insurance
issued to him without evidence of insurability, subject to the making of
an application and payment of the first premium within the period
specified in such policy, and if such individual is not given notice of
the existence of such right at least 15 days prior to the expiration date
of such period, then the individual shall have an additional period
within which to exercise such right; but nothing contained in this
section shall be construed to continue any insurance beyond the period
provided in such policy.
2. This additional period shall expire 15 days next after the
individual is given such notice, but in no event shall such additional
period extend beyond 60 days next after the expiration date of the period
provided in such policy.
3. Written notice presented to the individual or mailed by the
policyholder to the last known address of the individual or mailed by the
insurer to the last known address of the individual as furnished by the
policyholder shall constitute notice for the purpose of this section.
(Added to NRS by 1971, 1750)
Any group life insurance
contract may provide for a readjustment of the premium rate based upon
the experience thereunder.
(Added to NRS by 1971, 1751)
1. If a policy dividend is declared after January 1, 1972, or a
reduction in rate is made after January 1, 1972, or continued for the
first or any subsequent year of insurance under any policy of group life
insurance issued before, on or after January 1, 1972, to any
policyholder, the excess, if any, of the aggregate dividends or rate
reductions under such a policy and all other group insurance policies of
the policyholder over the aggregate expenditure for insurance under such
policies made from money contributed by the policyholder, or by an
employer of insured persons, or by a union or association to which the
insured persons belong, including expenditures made in connection with
administration of such policies, must be applied by the policyholder for
the sole benefit of insured employees or members.
2. This section does not apply to debtor groups.
(Added to NRS by 1971, 1751; A 1997, 1626)
An insurer shall pay the proceeds of any benefits
under a group life insurance policy not more than 30 days after the death
of the insured. If the proceeds are not paid within this period, the
insurer shall pay interest on the proceeds, at a rate that is not less
than the current rate of interest on death proceeds on deposit with the
insurer, from the date of death of the insured to the date when the
proceeds are paid.
(Added to NRS by 1997, 3033)
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