Senate Bill No. 6–Senator Washington
Prefiled January 11, 2001
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Referred to Committee on Commerce and Labor
SUMMARY—Prohibits practice of requiring borrowers
to insure improvements to real property for more than replacement value as
condition of obtaining loan. (BDR 57‑665)
FISCAL NOTE: Effect on Local Government: No.
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EXPLANATION
– Matter in bolded italics is new; matter
between brackets [omitted material] is material to be omitted.
Green numbers along
left margin indicate location on the printed bill (e.g., 5-15 indicates page 5, line 15).
AN ACT relating to property insurance; prohibiting a lender from requiring that a borrower
insure an improvement to real property for more than its replacement value as a
condition of obtaining or maintaining a loan secured by real property; and
providing other matters properly relating thereto.
THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN
SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
1-1 Section
1. Chapter 691A of NRS is
hereby amended by adding
1-2 thereto a new section to read as follows:
1-3 1.
A lender shall not require a borrower,
as a condition of obtaining
1-4 or maintaining a
loan secured by real property, to provide property
1-5 insurance on an
improvement to real property in an amount that exceeds
1-6 the reasonable
replacement value of the improvement.
1-7 2. As
used in this section:
1-8 (a) “Borrower” means a mortgagor, grantor of a
deed of trust or other
1-9 debtor.
1-10 (b) “Improvement to real property” means a
fixture, building or other
1-11 structure
attached to real property and intended as a permanent addition
1-12 to the property.
1-13 (c) “Lender” means a mortgagee, beneficiary of
a deed of trust or
1-14 other creditor
who holds a mortgage, deed of trust or other instrument
1-15 that encumbers
real property as security for the repayment of a debt.
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