This bill enacts a new section in the New Mexico Insurance Code that mandates property insurance policies covering wildfire damage to also include coverage for losses resulting from related flood damage. Specifically, when a policy covers damage from a wildfire, it must also encompass losses from flooding and associated events such as landslides, debris flows, mudflows, and mudslides for a period of five years following the control of the wildfire.

The provisions of this act will apply to insurance policies issued on or after July 1, 2026, ensuring that homeowners are protected from the compounded risks of wildfire and subsequent flooding. This legislative change aims to enhance the safety and financial security of property owners in areas prone to such natural disasters.