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 with respect to one life, including eligible net cash surrender and withdrawal values, subject to a $300,000 aggregate and statutory exclusions.

Nevada annuity protection at a glance

Annuity benefit limit
$250,000
Present value of covered annuity benefits, including eligible net cash surrender and net cash withdrawal values.
Overall benefit cap
$300,000
Nevada generally caps benefits at $300,000 in the aggregate with respect to one life or person across the statutory life insurance, annuity, structured-settlement, disability-income, long-term-care, and other health categories. When qualifying health-benefit-plan benefits are involved, the applicable aggregate may instead be $500,000. The $300,000 aggregate does not increase Nevada’s separate $250,000 ordinary annuity limit.
Who provides protection
Nevada Life and Health Insurance Guaranty Association
For an impaired insurer under rehabilitation or conservation, the Association has discretionary statutory powers; for an insolvent insurer under liquidation, it has specified duties under NRS 686C.152.
Insurer requirement
Member insurer
The issuing insurer must qualify as a member insurer under Nevada law, and the policy or contract must otherwise be covered under Chapter 686C.

How the $250,000 limit works

The $250,000 annuity limit includes eligible net cash surrender and withdrawal values. Nevada’s separate aggregate can further limit total protection when the same life or person has other covered benefits.

Multiple annuity policies or contracts with respect to the same life at the same impaired or insolvent member insurer share Nevada’s $250,000 ordinary annuity limit.

Coverage limits are generally applied separately to each impaired or insolvent member insurer, subject to Nevada’s eligibility and interstate-coordination rules.

Nevada generally caps benefits at $300,000 in the aggregate with respect to one life or person across the statutory life insurance, annuity, structured-settlement, disability-income, long-term-care, and other health categories. When qualifying health-benefit-plan benefits are involved, the applicable aggregate may instead be $500,000. The $300,000 aggregate does not increase Nevada’s separate $250,000 ordinary annuity limit.

  • A qualifying structured-settlement payee, or the beneficiary or beneficiaries of a deceased payee, may receive up to $250,000 in aggregate present-value annuity benefits, including eligible net cash surrender and withdrawal values, subject to Nevada’s applicable aggregate.
  • For a Commissioner-approved governmental retirement plan established under IRC sections 401, 403(b), or 457 and covered by an unallocated annuity contract, each participant may receive up to $250,000 in aggregate present-value annuity benefits, including eligible net cash surrender and withdrawal values. This category remains subject to Nevada’s applicable aggregate and is not an additional amount above it.

A $300,000 annuity example

Assume a Nevada resident owns an eligible fixed annuity with a covered present value of $300,000 at one impaired or insolvent member insurer and has no other covered benefits affecting the aggregate.

Annuity value

$300,000

Potential protection

$250,000

Possible receivership claim

$50,000

In this example, Nevada’s $250,000 annuity-specific limit applies. The separate $300,000 aggregate does not increase that amount.

This illustration shows Nevada’s statutory annuity limit and aggregate only; it does not estimate the timing or amount of any additional receivership recovery.

Which annuities are covered?

  • Fixed annuity

    Generally covered

    Fixed annuities are generally covered up to Nevada’s $250,000 present-value annuity limit with respect to one life, subject to eligibility requirements and statutory exclusions.

  • Fixed indexed annuity (FIA)

    Generally covered

    FIAs are generally covered to the extent of qualifying insurer-guaranteed benefits. Certain excess, uncredited, or forfeitable index-linked amounts may be excluded; however, when value is credited less frequently than annually, Nevada calculates the value as though the earlier impairment or insolvency date were the contractual crediting date and treats the resulting amount as credited and nonforfeitable.

  • Multi-year guaranteed annuity (MYGA)

    Generally covered

    MYGAs are generally treated as fixed deferred annuities and are subject to Nevada’s $250,000 present-value annuity limit and statutory interest-rate restrictions based on Moody’s Corporate Bond Yield Average.

  • Variable annuity

    Guaranteed portions may be covered

    Only qualifying insurer-guaranteed benefits may receive protection; investment gains or losses borne by the contract owner through a separate account are generally excluded.

  • Registered index-linked annuity (RILA)

    Contract-specific

    For a RILA, qualifying insurer-guaranteed contractual obligations may be covered, while portions where the contract owner bears market or index risk are generally excluded.

  • Unallocated annuity contract

    Limited situations

    Unallocated annuity contracts are generally excluded, except for qualifying governmental retirement plans under IRC sections 401, 403(b), or 457 that are approved by the Commissioner. In addition, an annuity benefit specifically guaranteed to a natural person is not treated as unallocated to that extent.

Who may qualify?

  • Residency is determined on the date of entry of a court order determining the member insurer to be impaired or insolvent.
  • For ordinary annuities, primary coverage generally follows a qualifying owner, enrollee, or certificate holder, while the $250,000 annuity limit is stated with respect to one life. Nevada defines the owner as the person identified as legal owner under the policy or contract, or vested with legal title through a valid assignment completed under the contract and properly recorded on the insurer’s books. Structured-settlement payees and governmental-plan participants follow separate statutory rules.
  • A nonresident may qualify in limited circumstances when the issuing insurer is Nevada-domiciled, the person’s state of residence has a similar guaranty association, and the person is not eligible for coverage there because the insurer lacked the required authorization under that state’s guaranty-association law.
  • Nevada’s interstate-coordination rules are designed to provide protection through only one state guaranty association and prevent duplicate coverage for the same obligation.
  • The issuing insurer must qualify as a member insurer under Nevada law, and the policy or contract must otherwise be covered under Chapter 686C.

What is not covered?

  • Unallocated annuity contracts are generally excluded, except for Commissioner-approved governmental retirement plans under IRC sections 401, 403(b), or 457; individually guaranteed benefits are not treated as unallocated to that extent.
  • Portions of a policy or contract that are not guaranteed by the member insurer, or under which the policy or contract owner bears the investment risk, are generally excluded from guaranty protection.
  • Interest or crediting above Nevada’s statutory limits and certain uncredited or forfeitable index-linked amounts may be excluded. For crediting intervals longer than one year, Nevada applies the deemed-crediting-date rule as of the earlier impairment or insolvency date.
  • Claims based on marketing materials, unauthorized side letters or riders, misrepresentations of policy or contract benefits, and obligations that do not arise from the express written terms of the contract are generally excluded.
  • Extra-contractual claims, including bad-faith claims, punitive or exemplary damages, attorneys’ fees and costs, as well as penalties and consequential or incidental damages, are generally excluded.
  • Reinsurance obligations are generally excluded unless the Association has issued an assumption certificate.
  • Self-funded or uninsured employer, association, and similar plans are generally excluded.
  • Dividends, experience-rating credits, voting rights, fees, allowances, and book-value accounting guarantees for certain defined-contribution plans are generally excluded.
  • Policies issued in Nevada while the insurer lacked authority to issue them, and benefits under Medicare Parts C or D or Medicaid, are generally excluded.

What happens after an insurer fails?

  1. Rehabilitation or conservation — impaired insurer

    A court order of rehabilitation or conservation establishes an impaired insurer and determines the residency date. Subject to Commissioner approval, the Association may guarantee, assume, reissue, or reinsure covered policies or provide financial support as authorized by NRS 686C.150.

  2. Liquidation with a finding of insolvency — insolvent insurer

    When a court orders liquidation after finding the member insurer insolvent, the Association must provide protection through the methods authorized by NRS 686C.152 and related provisions.

  3. Covered benefits and applicable limits are determined

    For ordinary annuities, the Association applies the $250,000 present-value annuity limit and then the applicable $300,000 aggregate; qualifying health-benefit-plan cases use the separate $500,000 aggregate.

  4. Amounts above guaranty protection

    Amounts above the Association’s protection may remain claims in the insurer’s receivership; the receiver and court determine allowance, priority, and any distribution from available estate assets.

How the guaranty system is financed

The Association is funded primarily through assessments of member insurers when funds are needed to carry out its statutory duties.

Assessment allocation
Member insurers
Class A assessments fund administrative, legal, and other general expenses. Class B assessments fund duties relating to impaired or insolvent member insurers and are allocated among accounts and subaccounts based generally on covered Nevada premiums under NRS 686C.240.
Annual assessment cap
Defined by state law
Annual assessment cap — 2%. For the Life and Annuity Account and each of its subaccounts, and separately for the Health Account, total annual assessments generally cannot exceed 2% of the member insurer’s average annual Nevada premiums on covered policies and contracts during the three calendar years preceding the year in which the affected insurer became impaired or insolvent.
Premium-tax treatment
State-specific rule
Premium-tax treatment — 20% per year for five years. A member insurer may offset 20% of a qualifying non-Class-A assessment against Nevada premium-tax liability in each of the five calendar years following the year in which the assessment was paid. If the insurer ceases doing business, it may offset all remaining uncredited assessments in that year.
Chapter 686C assessments
Funding mechanics do not change consumer coverage limits. NRS 686C.210 measures the statutory limits before taking into account the Association’s subrogation or assignment rights or covered-policy assets of the impaired or insolvent insurer.

What to know before buying

  • Nevada’s $300,000 aggregate can apply across covered life, annuity, structured-settlement, disability-income, long-term-care, and other health benefits involving the same life or person at one member insurer.
  • Nevada prohibits using the Association’s existence for sales, solicitation, or inducement. NRS 686C.128 also requires the Association to prepare a Commissioner-approved summary document that member insurers must deliver with covered policies or contracts; it warns that coverage may be limited or unavailable, is conditioned on continued Nevada residence, and should not be relied on when selecting an insurer.

How state protection differs from FDIC insurance

  • What it covers
    State protection: Nevada guaranty protection may apply to eligible contractual annuity benefits and to qualifying governmental-plan participant benefits under the limited unallocated-annuity exception.
    FDIC: Annuities are not FDIC-insured; eligible deposits at FDIC-insured banks receive federal deposit insurance.
  • What system stands behind it
    State protection: The Nevada Life and Health Insurance Guaranty Association is a nonprofit legal entity created by statute, funded through assessments of member insurers, and immediately supervised by the Commissioner.
    FDIC: Federal deposit insurance instead follows qualifying deposit accounts held at participating banks.
  • Coverage-limit basis
    State protection: Nevada generally provides up to $250,000 in present-value annuity benefits with respect to one life, subject to the $300,000 aggregate across the categories specified in NRS 686C.210 and the $500,000 health-benefit-plan exception.
    FDIC: The depositor’s ownership category and chosen bank determine federal aggregation.
  • Whether it applies to annuities
    State protection: Eligible annuity benefits may receive Nevada guaranty association protection, but annuity contracts are not bank deposits and are not insured by the FDIC.
    FDIC: Only a qualifying bank deposit receives federal coverage.

Sources and last verified

Last verified: September 29, 2026