(Reprinted with amendments adopted on April 21, 2023)
FIRST REPRINT S.B. 436
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SENATE BILL NO. 436–COMMITTEE ON COMMERCE AND LABOR
MARCH 27, 2023
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Referred to Committee on Commerce and Labor
SUMMARY—Revises provisions relating to service contracts.
(BDR 57-873)
FISCAL NOTE: Effect on Local Government: No.
Effect on the State: No.
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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.
AN ACT relating to insurance; requiring the provider of a service
contract to maintain or contract for an adequate network
or workforce of employees or contractors to carry out its
obligations under the service contract in a timely and
reasonable manner; providing that the holder of a service
contract is entitled to reimbursement of costs incurred as
the result of the failure by the provider to comply with
such a requirement; requiring the Commissioner of
Insurance to submit to the Joint Interim Standing
Committee on Commerce and Labor a report concerning
the service contract provider industry in this State; and
providing other matters properly relating thereto.
Legislative Counsel’s Digest:
Existing law provides for the regulation of providers of service contracts by the 1
Commissioner of Insurance. (Chapter 690C of NRS) Existing law defines a service 2
contract as a contract pursuant to which a provider, in exchange for separately 3
stated consideration, is obligated for a specified period to a holder to repair, replace 4
or perform maintenance on, or indemnify or reimburse the holder for the costs of 5
repairing, replacing or performing maintenance on, goods that are described in the 6
service contract and which have an operational or structural failure as a result of a 7
defect in materials, workmanship or normal wear and tear. Types of service 8
contracts include contracts that: (1) pay reimbursement for towing, rental and 9
emergency road service; and (2) provide for the repair, replacement or maintenance 10
of goods for damages that result from power surges or accidental damage from 11
handling. (NRS 690C.080) Existing law authorizes the Commissioner to assess a 12
civil penalty against a provider who fails to comply with existing law or who 13
violates an order or regulation of the Commissioner. (NRS 690C.330) 14
Section 1 of this bill requires a provider to ensure that the provider maintains or 15
contracts for an adequate network or workforce of employees or contractors to 16
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carry out its obligations to the holder of a service contract in a timely and 17
reasonable manner, including, without limitation, the duty to repair, replace or 18
perform maintenance on goods that are described in the service contract. Section 1 19
also provides that if the provider fails to comply with the requirement to maintain 20
or contract for such an adequate network or workforce of employees or contractors, 21
then, in addition to any other remedies available to the holder, a holder is entitled to 22
reimbursement from the provider for any reasonable and necessary costs incurred 23
by the holder to repair, replace or perform maintenance on the goods. 24
Section 2 of this bill requires the Commissioner of Insurance to submit to the 25
Joint Interim Standing Committee on Commerce and Labor an annual report that 26
provides certain information concerning the service contract industry in this State. 27
THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN
SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
Section 1. Chapter 690C of NRS is hereby amended by adding 1
thereto the provisions set forth as sections 1.5 and 2 of this act. 2
Sec. 1.5. 1. A provider shall maintain or contract for an 3
adequate network or workforce of employees or contractors that is 4
sufficient to carry out its obligations to a holder under a service 5
contract in a timely and reasonable manner, including, without 6
limitation, the duty to repair, replace or perform maintenance on 7
goods that are described in the service contract. 8
2. If a provider fails to comply with the provisions of 9
subsection 1, in addition to any other remedy available to a holder, 10
a holder is entitled to reimbursement from the provider for any 11
reasonable and necessary costs incurred by the holder to repair, 12
replace or perform maintenance on the goods. 13
Sec. 2. 1. On or before December 31, 2023, and on or 14
before December 31 of each year thereafter, the Commissioner 15
shall submit a report to the Joint Interim Standing Committee on 16
Commerce and Labor concerning the service contract industry in 17
this State. 18
2. The report must include, without limitation: 19
(a) For each report other than the initial report, the number of 20
service contracts sold by providers, by county, during the calendar 21
year for which the report is made; 22
(b) The number of providers doing business in this State; 23
(c) The number of providers, by the type of service contract 24
provided; 25
(d) The number of complaints concerning providers received 26
by the Division, by type of complaint; and 27
(e) Any other matter relating to the service contract industry in 28
this State that the Commissioner deems appropriate. 29
3. As used in this section: 30
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(a) “Provider” has the meaning ascribed to it in 1
NRS 690C.070. 2
(b) “Service contract” has the meaning ascribed to it in 3
NRS 690C.080. 4
Sec. 3. The provisions of subsection 1 of NRS 218D.380 do 5
not apply to any provision of this act which adds or revises a 6
requirement to submit a report to the Legislature. 7
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