Nevada's New Homeowners Insurance Law: What You Need to Know

Starting January 1, 2026, Nevada homeowners will face a pivotal change in their insurance coverage due to the enactment of Assembly Bill 376 (AB 376). This legislation introduces a shift in homeowners insurance, requiring separate purchases for wildfire coverage, which previously came standard. This change allows insurers to explore various underwriting and policy structures over the next four years, impacting both regulatory compliance and market stability.

The decision to separate wildfire coverage aims to maintain the insurance market's equilibrium by granting carriers more flexibility. Industry experts Michele Steinberg and Christina Rust from the National Fire Protection Association expressed concerns, stating policyholders might not be aware of the exclusion, potentially leading to significant financial exposure. This regulatory change comes amidst rising concerns about risk management, particularly in wildfire-prone areas like Lake Tahoe and the eastern Sierra Nevada.

Nevada Insurance Commissioner Ned Gaines supports the law, asserting it as a consumer protection measure to ensure continued carrier participation. Representative P.K. O’Neill, who advocated for the bill, emphasized that offering a more targeted range of insurance options is critical to avoid a market collapse. Although some view the law as necessary regulatory innovation to stabilize Nevada's insurance ecosystem, critics argue it increases financial burdens on homeowners. Educating policyholders on this regulatory change and ensuring they purchase AI-driven risk assessment tools can be vital in mitigating the adverse impacts of this legislation.