A.B. 231
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ASSEMBLY BILL NO. 231–ASSEMBLYMEMBERS HUNT;
D’SILVA AND JACKSON
FEBRUARY 10, 2025
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JOINT SPONSOR: SENATOR NEAL
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Referred to Committee on Commerce and Labor
SUMMARY—Requires a service contract to impose certain duties
on the provider of the service contract.
(BDR 57-655)
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 a service contract to
impose certain duties upon the provider of the service
contract; 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 requires that a 2
service contract specify the duties of the provider and any limitations, exceptions or 3
exclusions. (NRS 690C.260) This bill requires those duties to include, without 4
limitation, the duty to ensure that: (1) any goods, other than an air conditioner in a 5
home or dwelling, covered under the service contract are restored to sound working 6
condition within 14 business days after receiving notice that the goods are 7
defective; and (2) any goods which are restored and become defective within 14 8
business days after the date on which the goods were restored are restored within 2 9
business days after receiving notice that the goods are defective. With respect to an 10
air conditioner in a home or dwelling that is covered under a service contract, this 11
bill requires a service contract to provide that the provider has the duty to: (1) 12
ensure that the air conditioner is restored to sound working condition within 5 13
business days after receiving notice that the air conditioner is defective; and (2) if 14
the provider fails to do so, provide the holder with sleeping accommodations in a 15
hotel until the air conditioner is restored. 16
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THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN
SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
Section 1. NRS 690C.260 is hereby amended to read as 1
follows: 2
690C.260 1. A service contract must: 3
(a) Be written in language that is understandable and printed in a 4
typeface that is easy to read. 5
(b) Indicate that it is insured by a contractual liability insurance 6
policy if it is so insured, and include the name and address of the 7
issuer of the policy or that it is backed by the full faith and credit of 8
the provider if the service contract is not insured by a contractual 9
liability insurance policy. 10
(c) Include the amount of any deductible that the holder is 11
required to pay. 12
(d) Include the name and address of the provider and, if 13
applicable: 14
(1) The name and address of the administrator; and 15
(2) The name of the holder, if provided by the holder. 16
The names and addresses of such persons are not required to be 17
preprinted on the service contract and may be added to the service 18
contract at the time of the sale. 19
(e) Include the purchase price of the service contract. The 20
purchase price must be determined pursuant to a schedule of fees 21
established by the provider. The purchase price is not required to be 22
preprinted on the service contract and may be negotiated with the 23
holder and added to the service contract at the time of sale. 24
(f) Include a description of the goods covered by the service 25
contract. 26
(g) Specify the duties of the provider and any limitations, 27
exceptions or exclusions. The duties of the provider must include, 28
without limitation, the duty to: 29
(1) Except as otherwise provided in subparagraphs (2) and 30
(3), ensure that any goods described in the service contract that 31
the provider is obligated to repair or replace in the event the goods 32
become defective are restored within 14 business days after 33
receiving notice from the holder that the goods are defective. 34
(2) Except as otherwise provided in subparagraph (3), 35
ensure that any air conditioner in a home or dwelling that the 36
provider is obligated to repair or replace in the event that the air 37
conditioner becomes defective is restored within 5 business days 38
after receiving notice from the holder that the air conditioner is 39
defective. If the provider fails to restore the air conditioner within 40
that period, the provider shall provide the holder, at no cost to the 41
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holder, with sleeping accommodations in a hotel until the air 1
conditioner is restored. 2
(3) If the provider restores any goods and the goods become 3
defective within 14 business days after the date on which the goods 4
were restored, ensure that the goods are restored within 2 business 5
days after receiving notice from the holder that the goods are 6
defective. 7
(h) If the service contract covers a motor vehicle, indicate 8
whether replacement parts that are not made for or by the original 9
manufacturer of the motor vehicle may be used to comply with the 10
terms of the service contract. 11
(i) Include any restrictions on transferring or renewing the 12
service contract. 13
(j) Include the terms, restrictions or conditions for cancelling the 14
service contract before it expires and the procedure for cancelling 15
the service contract. The conditions for cancelling the service 16
contract must include, without limitation, the provisions of 17
NRS 690C.270. 18
(k) Include the duties of the holder under the contract, including, 19
without limitation, the duty to protect against damage to the goods 20
covered by the service contract or to comply with any instructions 21
included in the owner’s manual for the goods. 22
(l) Indicate whether the service contract authorizes the holder to 23
recover consequential damages. 24
(m) Indicate whether any defect in the goods covered by the 25
service contract existing on the date the contract is purchased is not 26
covered under the service contract. 27
2. A provider shall not allow, make or cause to be made a false 28
or misleading statement in any of the service contracts of the 29
provider or intentionally omit a material statement that causes a 30
service contract to be misleading. The Commissioner may require 31
the provider to amend any service contract that the Commissioner 32
determines is false or misleading. 33
3. As used in this section, “restored” means restoration to a 34
sound working condition by replacing the goods or any part 35
thereof, or by correcting what is inoperative. 36
Sec. 2. The amendatory provisions of this act apply to service 37
contracts entered into on or after October 1, 2025. 38
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