What Insurance Nevada Law Requires Your Association to Carry, and How It Shapes Storm and Damage Repairs

Nevada law sets a floor for the insurance your association must carry, and that coverage quietly decides how every storm and damage repair gets paid for. Here is what NRS 116.3113 requires and how it plays out when the work is real.

Most boards think about insurance twice: when the policy renews, and when something breaks. The second moment is always worse when the first one was rushed. In Nevada, the association’s coverage is not entirely up to the board’s discretion. NRS 116.3113 sets statutory minimums for what a common-interest community must carry, and those requirements quietly shape how every exterior repair, storm claim, and damage event gets funded.

This guide explains the Nevada HOA insurance requirements under NRS 116.3113, how deductibles are typically allocated, when a repair runs through the association’s policy versus an owner’s policy, and how all of it affects storm and damage repairs on your community’s buildings.

Educational, not legal or insurance advice. Insurance obligations depend on your governing documents, your specific policies, and the current statute. NRS 116.3113 has been amended over time. Confirm your association’s specific requirements with your insurance professional and Nevada counsel before making coverage or claims decisions.

What NRS 116.3113 Requires a Nevada Association to Carry

NRS 116.3113 sits within Nevada’s Common-Interest Ownership Act (NRS Chapter 116). Starting no later than the first conveyance of a unit to an owner other than the declarant, the association must maintain, to the extent reasonably available, several types of coverage.

Property insurance on the common elements. The association must carry property insurance on the common elements (and, in a planned community, on property that must become common elements) insuring against the risks of direct physical loss commonly insured against. The statute sets a floor on the amount: after application of any deductibles, the coverage must be not less than 80 percent of the actual cash value of the insured property at the time the insurance is purchased and at each renewal, excluding land, excavations, foundations, and other items normally left out of property policies.

Commercial general liability insurance. The association must carry liability coverage, including medical payments coverage, in an amount set by the executive board but not less than any amount specified in the governing documents. This covers bodily injury and property damage arising out of the use, ownership, or maintenance of the common elements.

Crime insurance. The association must also carry crime insurance covering dishonest acts by board members, officers, employees, agents, directors, volunteers, and any community manager entity and its employees. The statute prohibits a conviction requirement in that coverage, and sets the minimum policy amount at not less than three months of aggregate assessments on all units plus reserve funds, or $5,000,000, whichever is less.

Those are the floors. Taken together, they define HOA property insurance on the common elements in Nevada, plus the liability and crime coverage that sit alongside it. Many associations carry more, and many governing documents require more. The statute establishes the minimum, not the ceiling.

Actual Cash Value and the 80 Percent Floor

The 80-percent-of-actual-cash-value requirement deserves a closer look, because it is where boards most often misunderstand their exposure.

Actual cash value is not the same as replacement cost. Two associations with identical buildings can be insured very differently depending on how the policy is written and how values were set at the last renewal. The statutory floor is a minimum, and a community that insures only to that minimum can find itself underinsured when a major loss lands and construction costs have risen since the last valuation. This is why boards review insured values at renewal rather than rolling last year’s numbers forward on autopilot. The coverage that looked adequate two renewals ago may not rebuild the same structure at today’s costs.

How Deductibles Get Allocated

When a covered loss occurs, the deductible has to be paid by someone before the policy responds. How that deductible is allocated, between the association and an affected owner, is a frequent source of dispute and depends on the governing documents and the applicable Nevada provisions.

The practical point for a board is to know the answer before a claim, not during one. When a storm damages a building envelope and the association’s policy responds, the deductible allocation determines who absorbs that first layer of cost. Boards that have mapped this out in advance move faster on repairs and avoid the standoffs that stall work while owners and the association argue over who owes the deductible.

Association Policy vs. Owner Policy: Who Covers What

One of the most common questions on an exterior damage event is simple to ask and surprisingly complicated to answer: does this run through the association’s master policy or the owner’s individual policy?

The general dividing line follows the common elements. Damage to the common elements and the structures the association is responsible for ensuring typically runs through the association’s policy. Damage confined to the interior of a unit, or to property that is the owner’s responsibility, typically runs through the owner’s policy. But the exact line depends on the association’s governing documents and how the master policy is written, including whether it is a “bare walls,” “single entity,” or “all-in” style policy.

For exterior work in particular, roofs, siding, stucco, waterproofing systems, decks and balconies that are common elements, this distinction matters enormously. When the damaged assembly is a common element, the association’s coverage and its repair obligation are usually engaged, which is exactly why the board needs to understand its policy before a storm forces the question.

How Coverage Shapes Storm and Damage Repairs in Nevada

Here is where the statute stops being abstract. The coverage an association carries directly shapes how storm and damage repairs actually get done.

When damage hits a building envelope, the sequence is coverage, then claim, then repair. If the association is properly insured to the statutory floor or above, has mapped its deductible allocation, and knows which assemblies are its responsibility, it can move quickly: document the damage, coordinate the claim, and get a defensible repair scope in front of the adjuster. This claims coordination on exterior damage, tying the policy, the adjuster, and the repair scope together, is where a prepared board saves weeks. Nevada’s insurance provisions also address how loss proceeds are handled and applied to repair or replacement of the damaged portion of the community, which is why clean documentation and an accurate scope help proceeds flow to the actual repair.

If the association is underinsured, unclear on deductibles, or unsure which assemblies it must cover, the same storm turns into weeks of delay while coverage questions get sorted out and damage worsens. The difference is preparation. A board that understands NRS 116.3113 and its own policy treats a damage event as a process to execute, not a crisis to survive.

Related Provisions: How Loss Proceeds Are Handled

NRS 116.3113 does not operate alone. Nevada’s Common-Interest Ownership Act includes companion provisions that govern what happens after a covered loss. Related sections address how insurance policies must be structured, how loss proceeds are handled and paid, and how the association applies those proceeds to repair or replace the damaged or destroyed portion of the community.

The practical effect is that insurance proceeds from a covered loss are generally directed toward the actual repair or replacement of the damaged common elements, not treated as discretionary funds. For a board, this reinforces two habits. Document the loss thoroughly, because proceeds follow a defensible accounting of the damage. And build the repair scope carefully, because the proceeds are meant to fund a real remediation of the affected assemblies, not a partial patch that leaves the underlying problem in place. Clean documentation and an accurate scope are what let proceeds move efficiently from claim to completed repair.

What Boards Should Do Before the Next Loss

Three moves put an association ahead of the statute rather than behind it. Review insured values at every renewal so the 80-percent floor is met against current costs, not stale ones. Confirm, in writing, how deductibles are allocated and which assemblies fall under the association’s coverage versus an owner’s. And keep a repair partner and documentation process ready, so that when damage hits a common element, the claim and the scope come together quickly and the proceeds go to a repair that actually holds.

Bringing It Together

NRS 116.3113 is easy to file under “handled by the insurance agent” and forget. That is a mistake. The statute’s property, liability, and crime coverage requirements set the financial backstop for every major repair the association will ever face, and the details, actual cash value versus replacement cost, deductible allocation, common element versus owner responsibility, decide how smoothly a storm or damage repair gets done. A board that understands its coverage before the damage happens protects both the buildings and the owners who paid for them.