1. Upon the application of the Association or insured and upon cause shown, all proceedings in which the insolvent insurer is a party, or is obligated to defend a party, in any court in this state must be stayed for 3 months and any time thereafter ordered by the court after the date the insolvency is determined to permit proper defense by the Association of all pending causes of action. Cause may be established by affidavit showing the unavailability of the insolvent insurer’s files or records which are reasonably necessary for the Association to confirm coverage and adjust the claim.
2. If an insolvent insurer has failed to defend an insured in any action, the Association may apply on its own behalf or on behalf of the insured to have any judgment or order in the action set aside and the Association may defend against the action on its merits.
(Added to NRS by 1971, 1949; A 1977, 438; 1987, 928)
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