State annuity protection

Nevada Annuity Guaranty Protection: $250,000 Limit and $300,000 Aggregate

Nevada generally provides up to $250,000 in protection for the present value of covered annuity benefits, subject to a $300,000 aggregate across most covered benefit categories.

Nevada annuity protection at a glance

Annuity benefit limit
$250,000
Present value of annuity benefits, including Nevada’s stated net cash for surrender and withdrawal.
Overall benefit cap
$300,000
Nevada places a $300,000 combined maximum on most covered benefits from life insurance, annuities, structured settlements, disability income, long-term care, and other health coverage; adding qualifying health-plan benefits can raise that combined maximum to $500,000.
Who provides protection
Nevada Life and Health Insurance Guaranty Association
Nevada distinguishes an impaired insurer, for which the Association has discretionary powers, from an insolvent insurer, for which it has defined statutory duties.
Insurer requirement
Member insurer
The failed issuer must be a Nevada member insurer for the applicable coverage.

How the $250,000 limit works

The annuity figure includes net cash for surrender and withdrawal, but subsection 2 can reduce total recovery when other products are present.

All annuity value for one life or person at one failed insurer is measured together.

Another failed member company has its own chapter 686C calculation.

Nevada places a $300,000 combined maximum on most covered benefits from life insurance, annuities, structured settlements, disability income, long-term care, and other health coverage; adding qualifying health-plan benefits can raise that combined maximum to $500,000.

  • Nevada separately caps the present value owed to an eligible structured-settlement payee, or the payee’s beneficiaries after death, at $250,000.
  • An approved governmental-plan unallocated contract carries a $250,000 present-value maximum for each covered participant.

A $300,000 annuity example

Assume a Nevada resident holds a covered $300,000 fixed annuity and no competing benefit at the same insolvent insurer.

Annuity value

$300,000

Potential protection

$250,000

Possible receivership claim

$50,000

The annuity reaches its own maximum while leaving the separate $300,000 cross-category ceiling unfilled.

The illustration applies Nevada’s $250,000 annuity amount and $300,000 combined-benefit ceiling without estimating any receivership distribution.

Which annuities are covered?

  • Fixed annuity

    Generally covered

    A covered fixed annuity can receive up to $250,000 in present value.

  • Fixed indexed annuity (FIA)

    Generally covered

    An FIA can qualify for guaranteed obligations, while Nevada removes specified nonguaranteed, excess, or forfeitable index amounts. When credits occur less than once a year, the failure date is treated as the contract’s crediting date for this calculation.

  • Multi-year guaranteed annuity (MYGA)

    Generally covered

    A fixed deferred MYGA generally qualifies, but Nevada removes interest above the Moody’s-based statutory thresholds from the protected obligation.

  • Variable annuity

    Guaranteed portions may be covered

    Variable separate-account gains remain owner-borne.

  • Registered index-linked annuity (RILA)

    Contract-specific

    A RILA qualifies only to the extent the insurer owes an enforceable guarantee; owner-carried market and index exposure stays outside the guaranty.

  • Unallocated annuity contract

    Limited situations

    Approved governmental-plan unallocated annuities can protect participants, while other unallocated contracts are excluded. An obligation expressly guaranteed to a natural person is not treated as unallocated to that extent.

Who may qualify?

  • Nevada tests residence when the court enters the order determining that the member company is impaired or insolvent.
  • The owner, annuitant, or statutory payee associated with one life controls the ordinary annuity limit.
  • For a claimant living elsewhere, the issuer generally must be domiciled in Nevada, the home state must operate a comparable association, and that association must deny eligibility because the issuer lacked its required authorization there.
  • Nevada domicile matters only within the statute’s limited interstate coordination rules.
  • The failed issuer must be a Nevada member insurer for the applicable coverage.

What is not covered?

  • Ordinary unallocated annuity contracts are excluded; the approved governmental-plan exception is narrow.
  • Nonguaranteed portions and amounts for which the owner bears investment risk are not protected.
  • Nevada removes specified excess interest and index value that is uncredited or forfeitable, while preserving its special calculation for credits made less often than yearly.
  • Claims arising only from sales materials, unapproved side documents, benefit misstatements, or obligations beyond the written contract do not qualify.
  • The guaranty does not pay statutory penalties or damages that are consequential or incidental.

What happens after an insurer fails?

  1. 1

    Impairment or conservation

    A court order fixes Nevada residency, and the Association may support covered contracts of an impaired insurer subject to statutory conditions.

  2. 2

    Liquidation after insolvency

    For an insolvent member insurer, the Association must perform the duties Nevada law assigns to it for covered obligations.

  3. 3

    Coverage limits applied

    The Association applies the applicable product amount and then Nevada’s combined-benefit aggregate.

  4. 4

    Receivership claim

    A claimant can file under Nevada’s liquidation procedures; the receiver and court determine allowance, priority, and any distribution from available estate assets.

How the guaranty system is financed

Nevada’s association calls on its member companies for the amounts required to carry out the guaranty law.

Assessment allocation
Member insurers
Class A assessments cover administration and legal costs; Class B assessments fund obligations tied to impaired or insolvent insurers and are allocated by account and covered Nevada premium.
Annual assessment cap
Defined by state law
Nevada applies the yearly ceiling to the Life and Annuity Account, each subaccount, and the Health Account. The amount is 2% of a member insurer’s average annual Nevada premiums, calculated across the three calendar years prescribed for covered business.
Premium-tax treatment
State-specific rule
For each of the five years following payment, Nevada lets a member insurer apply one-fifth (20%) of a qualifying non-Class-A assessment against its state premium-tax bill.
Chapter 686C assessments
Nevada separates Class A administrative assessments from Class B assessments associated with impaired or insolvent insurers.

What to know before buying

  • Nevada’s $300,000 combined-benefit ceiling can include eligible annuity, disability, long-term-care, life, and structured-settlement benefits at one carrier.
  • Nevada prohibits treating guaranty protection as a sales feature; eligibility follows the statute regardless of promotional descriptions.

How state protection differs from FDIC insurance

  • What it covers
    State protection: Nevada protection reaches covered annuity value and certain governmental-plan participant benefits.
    FDIC: The FDIC protects eligible deposits, not insurance or plan contracts.
  • What system stands behind it
    State protection: The Nevada Life and Health Insurance Guaranty Association carries chapter 686C obligations.
    FDIC: Federal insurance instead follows qualifying deposit accounts held at participating banks.
  • Coverage-limit basis
    State protection: Nevada applies $250,000 with respect to one life, with most categories sharing a $300,000 ceiling.
    FDIC: The depositor’s ownership category and chosen bank determine federal aggregation.
  • Whether it applies to annuities
    State protection: An eligible Nevada annuity can receive chapter 686C protection but has no FDIC insurance.
    FDIC: Only a qualifying bank deposit receives federal coverage; the Nevada annuity does not.

Sources and last verified

Last verified: September 17, 2026