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SB 308 - Guidance from the Nevada Division of Insurance

The 2017 Nevada Legislature passed Senate Bill 308 (“SB 308”). SB 308 was signed by Governor Sandoval and will be effective July 1, 2018. SB 308 raises Nevada’s minimum automobile liability limits from 15/30/10 to 25/50/20.

Over the last few weeks, numerous questions have been brought to the Division’s attention with respect to implementation of SB 308. The Division is providing guidance in response to such questions below:

Policies

  • To avoid any potential market disruption or confusion among Nevada constituents, the Division strongly recommends that insurers consider notifying their policyholders of the change in law as early as possible or as the policies come up for renewal. It is recommended that such notice explain the reason for changes to the policyholders’ minimum liability limits and the date the new law becomes effective.
  • Due to the Legislative mandate, SB 308 is effective July 1, 2018. At that date, any policies that are below the new minimum limits of 25/50/20 would not satisfy this statutory mandate. Insurers may unilaterally make this change to be effective July 1, 2018, for any policies in effect at 15/30/10.
  • The insurers may send out a billing notice for the difference in premium for the higher liability coverage amounts. Such notice must be sent at least 30 days prior to June 30, 2018.  

Rates & Forms

  • Insurers who currently do not have a rating plan or rating factors for 25/50/20 limits are required to file the rates with the Division under the prior-approval provisions of Nevada law.

UM/UIM
Pursuant to Nevada law, NRS 687B.145 and NRS 690B.020, insurers are required to offer the optional UM/UIM coverage at least in the minimum liability amounts. As such, insurers will have to undertake certain measures to address this matter:

  •  File updated rates with the Division -  if rates for 25/50 (UMBI) or 20 (UMPD) coverage are not already filed and approved.
  • File updated UM/UIM Selection/Rejection forms (without the 15/30 limits) with the Division for prior approval.
  • Obtain an updated UM/UIM selection/rejection form from all policyholders who currently have UM/UIM limits below 25/50 (UMBI), prior to June 30, 2018, to be effective July 1, 2018.
  • Since UM/UIM is an optional coverage, notify the policyholders who are currently at 15/30/10 limits of the change to 25/50/20 minimum liability limits, effective 7/1/2018.
  • Explain the premium difference when securing the updated selection/rejection form.

If you have any questions, please contact:
Rajat Jain, Chief Insurance Examiner | Property and Casualty Section, Nevada Division of Insurance,
Direct: (775) 687-0774