Key Takeaways
- Nevada producers must act in the best interest of clients
- Producers must disclose compensation arrangements and conflicts of interest
- Trust funds and premiums must be handled according to strict requirements
- Producers must maintain accurate records
- Continuing education includes ethics requirements
Last updated: January 2026
Producer Conduct and Fiduciary Duties
Nevada insurance producers have legal and ethical obligations to their clients and the public.
Producer Duties
Insurance producers owe duties to their clients:
Key Duties
| Duty | Description |
|---|---|
| Loyalty | Put client's interests first |
| Disclosure | Reveal all material information |
| Competence | Maintain professional knowledge |
| Confidentiality | Protect client information |
| Good Faith | Act honestly in all dealings |
Handling of Funds
Producers must handle premiums and client funds according to strict rules:
Premium Collection
| Requirement | Rule |
|---|---|
| Deposit | Promptly to insurer or trust account |
| Commingling | Cannot mix with personal funds |
| Trust Account | Required for holding premiums |
| Records | Must maintain detailed records |
Consequences of Mishandling
| Consequence | Detail |
|---|---|
| License Suspension | Immediate suspension pending investigation |
| License Revocation | Permanent loss of license |
| Restitution | Must repay all misappropriated funds |
| Civil Liability | Subject to lawsuits from harmed parties |
| Criminal Charges | Potential felony prosecution for theft |
| NIPR Reporting | Reported to NIPR and other states |
Disclosure Requirements
Nevada requires producers to make certain disclosures:
Required Disclosures
| Disclosure | When Required |
|---|---|
| Producer Status | Before application |
| Compensation | If requested by client |
| Conflicts of Interest | When conflicts exist |
| Insurer Relationship | Agent vs. broker status |
| Policy Limitations | Material limitations and exclusions |
Record Keeping Requirements
Nevada requires producers to maintain records:
| Record Type | Retention Period |
|---|---|
| Applications | 5 years |
| Policy Documents | 5 years after expiration |
| Correspondence | 5 years |
| Replacement Documents | 5 years |
| Commission Records | 5 years |
| Suitability Documents | 5 years |
Insurance Fraud (NRS 686A.291)
Nevada aggressively prosecutes insurance fraud:
Types of Insurance Fraud
| Type | Description |
|---|---|
| Application Fraud | False statements on applications |
| Claims Fraud | Exaggerated or fabricated claims |
| Premium Fraud | Non-payment or diversion of premiums |
| Agent Fraud | Misappropriation, forgery, unauthorized policies |
Fraud Penalties
| Offense Level | Penalty |
|---|---|
| Gross Misdemeanor | Up to 1 year jail + $2,000 fine |
| Category D Felony | 1-4 years prison + $5,000 fine |
| Category B Felony | 1-6 years prison + $10,000 fine |
Fraud Reporting
| Obligation | Requirement |
|---|---|
| Insurers | Must report suspected fraud to DOI |
| Producers | Should report suspected fraud |
| Immunity | Good faith reporters have civil immunity |
Exam Tip: Insurance fraud is taken very seriously in Nevada with potential felony charges. Know the different types of fraud and reporting obligations.
Test Your Knowledge
What is the consequence of a Nevada producer commingling client funds with personal funds?
A
B
C
D
Test Your Knowledge
How long must Nevada producers retain records such as applications and policy documents?
A
B
C
D