On May 6, 2014 the Insurance Commissioner of the State of Nevada (the "Commissioner") was appointed by the Second Judicial District Court of the State of Nevada as Receiver of National Guaranty Insurance Company (the "Company") pursuant to NRS 696B.250 of the Nevada Revised Statutes ("NRS"). On June 12, 2014, the Court appointed the Nevada Insurance Commissioner as Permanent Receiver of NGIC and an order of liquidation was issued. The Commissioner has the responsibility to take these actions whenever a company is deemed to be impaired as statutorily defined in NRS696B.220.
Upon the order of liquidation, the provisions of NRS 687A governing the Nevada Insurance Guaranty Association ("NIGA") are invoked. NIGA assumes the handling of the insolvent insurers open, unpaid Nevada covered claims. A "covered claim" is defined as an unpaid claim or judgment, including a claim for unearned premiums, which arises out of and is within the coverage of an insurance policy issued by an insurer which becomes insolvent. While most policy type claims are handled by NIGA, generally any non-covered policy claims or any unpaid obligation not related to a policy are brought directly against the estate through a Proof of Claim process.
On October 24, 2014, the Commissioner filed a Recommendation of Receiver to Modify the Claims Process pursuant to NRS 696B.330(4) for financial reasons. The available assets of NGIC are not sufficient to pay claims beyond the administrative class as defined by NRS 696B.420(1)(a). The obligation of the Receiver to execute and administer a proof of claim process for policy claimants likely to be paid by NIGA, and other creditors who have no chance to be paid through a Proof of Claim process, is costly and will not benefit the receivership estate. The court hearing date for this matter is scheduled for January 26, 2015.
Any opposition to the Motion to Modify Claims Process per Recommendation of Receiver must be received and properly submitted pursuant to the Rules of Practice for the Second Judicial District Court of the State of Nevada, by December 31, 2014.
A copy of the Recommendation of Receiver to Modify the Claims Process can be found on the Regulatory Services Group website at www.rsgca.org. For further inquiries, you may email us at email@example.com or call 415-676-2121 or fax at 415-676-5002.
Claims not covered by the Nevada Insurance Guaranty Association
National Guaranty Insurance Company claims are handled under Nevada insolvency law which specifically excludes either liability for pre-liquidation expense billings or for subrogation claims from being considered a covered claim by the Nevada Insurance Guaranty Association. For further inquiries pertaining to National Guaranty policy related claims, please visit nevada.ncigf.org or call 702-368-0607.