Requires certain service contracts to impose certain duties upon the provider of the service contract. (BDR 57-655)
AB 231 amends Nevada’s service contract law to add specific performance obligations for providers of home warranty service contracts. A “home warranty service contract” is defined as a contract covering only the structural components, appliances, or home systems of a residence, including electrical, heating, cooling, and plumbing systems. The bill requires these contracts to spell out that covered goods generally must be restored to working condition within 14 business days after notice of a defect, and that if repaired goods fail again within 14 business days, they must be restored within 2 business days after notice.
The bill creates a faster timeline for air conditioners, furnaces, and heaters. For those systems, the provider must restore service within 5 business days after notice. If the provider does not meet that deadline, the contract must provide a per diem lodging allowance for the holder until the system is restored, using the federal government’s comparable lodging rate. The bill also preserves existing disclosure requirements for service contracts, including contract terms, exclusions, cancellation rules, holder duties, and whether consequential damages are recoverable, while adding these new home warranty-specific duties.
AB 231’s legal effect is to amend NRS 690C.260, which governs required contents of service contracts regulated by the Commissioner of Insurance. It applies only to service contracts entered into on or after October 1, 2025. The bill does not create a state or local fiscal impact according to the fiscal note, but it does impose new contractual obligations on home warranty providers and may affect how those providers draft, price, and administer residential coverage in Nevada.
The general sentiment appears to be supportive enough for passage, but not unanimous. The Assembly passed the bill on final passage by a vote of 27-15, indicating meaningful opposition despite majority approval. No committee transcript is available, so the record does not show detailed debate, but the vote suggests the bill was viewed favorably by a majority while raising concerns for a substantial minority.
The main point of contention is likely the degree of mandated repair speed and the lodging reimbursement requirement, especially for heating and cooling systems. Supporters would likely view the bill as strengthening consumer protections and ensuring timely repairs for essential home systems, while opponents may see it as imposing rigid deadlines and added costs on service contract providers that could increase premiums or reduce flexibility in handling repairs and parts availability.
AB 231 amends NRS 690C.260 in Chapter 690C of the Nevada Revised Statutes, which regulates service contracts under the Commissioner of Insurance. It adds mandatory terms for home warranty service contracts, including repair deadlines, expedited restoration for repeat failures, and a lodging allowance for delayed air conditioner, furnace, or heater repairs. The bill applies prospectively to contracts entered into on or after October 1, 2025, and is expected to affect home warranty providers, insurers backing service contracts, and consumers purchasing residential coverage.
The bill appears to have received mixed but ultimately favorable treatment. It passed the Assembly on final passage by a 27-15 vote, showing majority support but notable opposition. With no committee transcript available, there is no detailed record of floor or committee arguments, but the vote pattern suggests the bill was seen as a consumer-protection measure by supporters and as a potentially burdensome mandate by opponents.
The likely areas of contention are the bill’s strict repair timelines and the required lodging reimbursement when air conditioning, heating, or furnace repairs are delayed. Supporters would likely argue that these provisions protect homeowners from prolonged loss of essential services and create accountability for home warranty providers. Opponents likely object to the operational and financial burden of fixed deadlines, especially where parts, labor, or diagnostic issues may delay repairs, and to the added cost exposure from mandatory lodging payments.