Senate Bill No. 6–Senator Washington

 

CHAPTER..........

 

AN ACT relating to property insurance; prohibiting a lender from requiring that a borrower insure improvements to real property for more than their 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:

 

   Section 1. Chapter 691A of NRS is hereby amended by adding

 thereto a new section to read as follows:

   1.  A lender shall not require a borrower, as a condition of obtaining

 or maintaining a loan secured by real property, to provide property

 insurance on improvements to real property in an amount that exceeds

 the reasonable replacement value of the improvements.

   2.  As used in this section:

   (a) “Borrower” means a mortgagor, grantor of a deed of trust or other

 debtor.

   (b) “Improvement to real property” means a fixture, building or other

 structure attached to real property and intended as a permanent addition

 to the property.

   (c) “Lender” means a mortgagee, beneficiary of a deed of trust or

 other creditor who holds a mortgage, deed of trust or other instrument

 that encumbers real property as security for the repayment of a debt.

 

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