Two large wildfires have been raging in Nevada for over a week. The fires, both sparked by lightening, are near Reno (Bison Fire) and Las Vegas (Carpenter 1 Fire). Continuing with the state-by-state series on total loss standards, this week it I focus on Nevada since most total situations arise in fire losses.
In my research of Nevada law, I did not across any cases with holdings that specifically define total loss or discuss what constitutes a total loss in the context of property damage. Most states have either adopted the “identity” test, whether the building after the fire has lost its identity or special character, or the “prudent person” test, where reasonableness or practicality of the repair is the determining factor.
But a Nevada Supreme Court decision touched on total loss.1 In that case, the fire-damaged building was condemned by city officials as unsafe and ordered demolished. The insurance company contended it was not a total loss and it was only liable for the cost to restore the building to its pre-loss condition. The policyholder contended the building was a total loss because the city would not issue a permit for repairs, ordering it demolished instead. The Court sided with the policyholder, holding a condemnation order was sufficient to support a finding of total loss.
By my count, to date we have covered 30 states in this blog series, just another 20 to go!