Nevada
Summary
Statutes
NEVADA CHAPTER 690C (SEE ALSO: 690B as modified in 2003 below)
SERVICE CONTRACTS
NRS 690C.010 to NRS 690C.120 CLICK HERE
DELETED IN 2011:
2. Maintain a reserve account and deposit with the Commissioner security as provided in this subsection. The reserve account must contain at all times an amount of money equal to at least 40 percent of the gross consideration received by the provider for any unexpired service contracts, less any claims paid on those unexpired service contracts. The Commissioner may examine the reserve account at any time. The provider shall also deposit with the Commissioner security in an amount that is equal to $25,000 or 5 percent of the gross consideration received by the provider for any unexpired service contracts, less any claims paid on the unexpired service contracts, whichever is greater.
Reinserted EFFECTIVE January 1, 2014:
2. The reserve account must contain at all times an amount of money equal to at least 40 percent of the unearned gross consideration received by the provider for any unexpired service contracts. The Commissioner may examine the reserve account at any time. The provider shall also deposit with the Commissioner security in an amount that is equal to $25,000 or 10 percent of the unearned gross consideration received by the provider for any unexpired service contracts, whichever is greater.
The security must be:
(a) A surety bond issued by a surety company authorized to do business in this state;
(b) Securities of the type eligible for deposit pursuant to NRS 682B.030 ;
(c) Cash;
(d) An irrevocable letter of credit issued by a financial institution approved by the Commissioner; or
(e) In any other form prescribed by the Commissioner.
3. Maintain, or be a subsidiary of a parent company that maintains, a net worth or stockholders’ equity of at least $100,000,000. Upon request, a provider shall provide to the Commissioner a copy of the most recent Form 10-K report or Form 20-F report filed by the provider or parent company of the provider with the Securities and Exchange Commission within the previous year. If the provider or parent company is not required to file those reports with the Securities and Exchange Commission, the provider shall provide to the Commissioner a copy of the most recently audited financial statements of the provider or parent company. If the net worth or stockholders’ equity of the parent company of the provider is used to comply with the requirements of this subsection, the parent company must guarantee to carry out the duties of the provider under any service contract issued or sold by the provider.
(Added to NRS by 1999, 3337 )
MISCELLANEOUS PROVISIONS
NRS 690C.200 Name of provider.
1. Except as otherwise provided in this section, a provider shall not include in the name of his business:
(a) The words “insurance,” “casualty,” “surety,” “mutual” or any other word or term that implies that he is engaged in the business of transacting insurance or is a surety company; or
(b) A name that is deceptively similar to the name or description of an insurer or surety company or the name of another provider.
2. A provider may include the word “guaranty” or a similar word in the name of his business.
3. This section does not apply to a provider who, before January 1, 2000, includes in the name of his business a name that does not comply with the provisions of subsection 1. Such a provider shall include in each service contract he issues, sells or offers for sale a statement that the service contract is not a contract of insurance.
(Added to NRS by 1999, 3340 )
NRS 690C.210 Requirements of contractual liability insurance policy; holder authorized to apply to issuer of policy for performance in certain circumstances.
1. A contractual liability insurance policy issued in this state must provide that the issuer of the policy shall:
(a) Reimburse or pay on behalf of the provider any money the provider has a duty to pay under a service contract; or
(b) Otherwise provide for the performance of the duties of the provider under a service contract.
2. If a provider fails to perform his duties under a service contract within 60 days after receiving notice from the holder that the goods described in the contract are defective, the holder may apply to the issuer of the contractual liability insurance policy for performance of the duties of the provider under the service contract.
(Added to NRS by 1999, 3338 )
NRS 690C.220 Requiring purchase of service contract as condition of loan or purchase of goods prohibited. No person may require the purchase of a service contract as a condition for the approval of a loan or the purchasing of goods.
(Added to NRS by 1999, 3340 )
NRS 690C.230 Receipt or written evidence of service contract required; copy of service contract required to be furnished to holder within reasonable time.
1. A provider shall provide a receipt for, or other written evidence of, the purchase of a service contract.
2. The provider shall furnish a copy of the service contract to the holder within a reasonable time after the contract is purchased.
(Added to NRS by 1999, 3340 )
PROVISIONS OF CONTRACT
NRS 690C.250 Conditions under which service contract void and refund required; right of original purchaser; provision stating right required; penalty.
1. A service contract is void and a provider shall refund to the holder the purchase price of the service contract if the holder has not made a claim under the service contract and the holder returns the service contract to the provider:
(a) Within 20 days after the date the provider mails a copy of the service contract to the holder;
(b) Within 10 days after the purchaser receives a copy of the service contract if the provider furnishes the holder with the copy at the time the contract is purchased; or
(c) Within a longer period specified in the service contract.
2. The right of a holder to return a service contract pursuant to this section applies only to the original purchaser of the service contract.
3. A service contract must include a provision that clearly states the right of a holder to return a service contract pursuant to this section.
4. The provider shall refund to the holder the purchase price of the service contract within 45 days after a service contract is returned pursuant to subsection 1. If the provider fails to refund the purchase price within that time, the provider shall pay the holder a penalty of 10 percent of the purchase price for each 30-day period or portion thereof that the refund and any accrued penalties remain unpaid.
(Added to NRS by 1999, 3338 )
NRS 690C.260 Contents; false or misleading statement prohibited.
1. A service contract must:
(a) Be written in language that is understandable and printed in a typeface that is easy to read.
(b) Indicate that it is insured by a contractual liability insurance policy if it is so insured, and include the name and address of the issuer of the policy or that it is backed by the full faith and credit of the provider if the service contract is not insured by a contractual liability insurance policy.
(c) Include the amount of any deductible that the holder is required to pay.
(d) Include the name and address of the provider and, if applicable:
(1) The name and address of the administrator; and
(2) The name of the holder, if provided by the holder.
The names and addresses of such persons are not required to be preprinted on the service contract and may be added to the service contract at the time of the sale.
(e) Include the purchase price of the service contract. The purchase price must be determined pursuant to a schedule of fees established by the provider. The purchase price is not required to be preprinted on the service contract and may be negotiated with the holder and added to the service contract at the time of sale.
(f) Include a description of the goods covered by the service contract.
(g) Specify the duties of the provider and any limitations, exceptions or exclusions.
(h) If the service contract covers a motor vehicle, indicate whether replacement parts that are not made for or by the original manufacturer of the motor vehicle may be used to comply with the terms of the service contract.
(i) Include any restrictions on transferring or renewing the service contract.
(j) Include the terms, restrictions or conditions for cancelling the service contract before it expires and the procedure for cancelling the service contract. The conditions for cancelling the service contract must include, without limitation, the provisions of NRS 690C.270 .
(k) Include the duties of the holder under the contract, including, without limitation, the duty to protect against damage to the goods covered by the service contract or to comply with any instructions included in the owner’s manual for the goods.
(l) Indicate whether the service contract authorizes the holder to recover consequential damages.
(m) Indicate whether any defect in the goods covered by the service contract existing on the date the contract is purchased is not covered under the service contract.
2. A provider shall not allow, make or cause to be made a false or misleading statement in any of his service contracts or intentionally omit a material statement that causes a service contract to be misleading. The Commissioner may require the provider to amend any service contract that the Commissioner determines is false or misleading.
(Added to NRS by 1999, 3339 )
NRS 690C.270 Grounds for cancellation; date cancellation effective.
1. No service contract that has been in effect for at least 70 days may be cancelled by the provider before the expiration of the agreed term or 1 year after the effective date of the service contract, whichever occurs first, except on any of the following grounds:
(a) Failure by the holder to pay an amount when due;
(b) Conviction of the holder of a crime which results in an increase in the service required under the service contract;
(c) Discovery of fraud or material misrepresentation by the holder in obtaining the service contract, or in presenting a claim for service thereunder;
(d) Discovery of:
(1) An act or omission by the holder; or
(2) A violation by the holder of any condition of the service contract,
Êwhich occurred after the effective date of the service contract and which substantially and materially increases the service required under the service contract; or
(e) A material change in the nature or extent of the required service or repair which occurs after the effective date of the service contract and which causes the required service or repair to be substantially and materially increased beyond that contemplated at the time that the service contract was issued or sold.
2. No cancellation of a service contract may become effective until at least 15 days after the notice of cancellation is mailed to the holder.
(Added to NRS by 1999, 3340 )
REGULATION AND ENFORCEMENT
NRS 690C.300 Regulations of Commissioner. The Commissioner may adopt such regulations as are necessary to carry out the provisions of this chapter.
(Added to NRS by 1999, 3341 )
NRS 690C.310 Retention of records.
1. A provider shall maintain records of the transactions governed by this chapter. The records of a provider must include:
(a) A copy of each type of service contract that the provider issues, sells or offers for sale;
(b) The name and address of each holder who possesses a service contract under which the provider has a duty to perform, to the extent that the provider knows the name and address of each holder;
(c) A list that includes each location where the provider issues, sells or offers for sale service contracts; and
(d) The date and a description of each claim made by a holder under a service contract.
2. Except as otherwise provided in this subsection, a provider shall retain all records relating to a service contract for at least 1 year after the contract has expired. A provider who intends to discontinue doing business in this state shall provide the Commissioner with satisfactory proof that he has discharged his duties to the holders in this state and shall not destroy his records without the prior approval of the Commissioner.
3. The records required to be maintained pursuant to this section may be stored on a computer disc or other storage device for a computer from which the records can be readily printed.
(Added to NRS by 1999, 3341 )
NRS 690C.320 Examinations to enforce provisions of chapter by Commissioner.
1. Except as otherwise provided in this subsection, the Commissioner may conduct examinations to enforce the provisions of this chapter pursuant to the provisions of NRS 679B.230 to 679B.300 , inclusive, at such times as he deems necessary. The Commissioner is not required to comply with the requirement in NRS 679B.230 that insurers be examined not less frequently than every 5 years in the enforcement of this chapter.
2. A provider shall, upon the request of the Commissioner, make available to the Commissioner for inspection any accounts, books and records concerning any service contract issued, sold or offered for sale by the provider which are reasonably necessary to enable the Commissioner to determine whether the provider is in compliance with the provisions of this chapter.
(Added to NRS by 1999, 3341 )
NRS 690C.330 Penalty for violation of chapter or order or regulation of Commissioner. A person who violates any provision of this chapter or an order or regulation of the Commissioner issued or adopted pursuant thereto may be assessed a civil penalty by the Commissioner of not more than $500 for each act or violation, not to exceed an aggregate amount of $10,000 for violations of a similar nature. For the purposes of this section, violations shall be deemed to be of a similar nature if the violations consist of the same or similar conduct, regardless of the number of times the conduct occurred.
(Added to NRS by 1999, 3341 )
INSURANCE FOR HOME PROTECTION
NRS 690B.100 Definitions. As used in NRS 690B.100 to 690B.180 , inclusive, unless the context otherwise requires:
1. “Home” means a structure used primarily for residential purposes and includes, without limitation:
(a) A single-family dwelling;
(b) A unit in a multiple-family structure;
(c) A mobile home; and
(d) The common elements of a common-interest community, as defined in NRS 116.017 , and any appurtenance to the common elements.
2. “Insurance for home protection” means a contract of insurance, which affords coverage over a specified term for a predetermined fee, under which a person, other than the manufacturer, builder, seller or lessor of the home, agrees to repair, replace or indemnify from the cost of repair or replacement based upon the failure of any structure, component, system or appliance of the home. The term does not include:
(a) A contract which insures against any consequential losses caused by the defects or failures.
(b) An annual home service agreement on household appliances, systems and components if the agreement principally provides for service, repair or replacement due to normal wear and tear or inherent defect. Such agreements may include provisions for incidental indemnity or for service or repair of roof leaks.
(Added to NRS by 1981, 1321; A 1995, 1630, 2558; 1997, 650; 1999, 1447 ; 2003, 3317 )
