Who must be a member of the Nevada Life and Health Insurance Guaranty Association?

The correct answer is that all authorized insurers transacting life or health insurance in Nevada must be members of the Nevada Life and Health Insurance Guaranty Association. This requirement ensures that there is a safety net for policyholders in the event that an insurance company becomes insolvent. The association provides a means to protect the interests of consumers, ensuring that they can receive benefits promised under their policies, even if their insurance provider cannot fulfill its obligations due to financial difficulties.

Membership in the Guaranty Association is vital for maintaining public confidence in the insurance industry. By requiring all authorized life and health insurers to participate, the association creates a level of financial security and stability within the market. This protects consumers by reducing the risk they face when choosing insurance products from licensed companies.

In contrast, the other options depict scenarios that do not align with the comprehensive membership criteria established by state law. Not only companies with a specific focus, such as life insurance or annuities, but also any insurer authorized to conduct life or health insurance business in Nevada are required to be members. Furthermore, membership isn’t based on the size of the company, such as the number of employees, but rather on the company's licensing to offer insurance products.