Need help navigating the service contract and extended warranty regulatory process?

If you are a provider, administrator, seller or insurer of service contracts; or want to be, let us be your guide to all the state service contract and extended warranty laws around the country.  We can help guide you through the licensing and registration hoops;  and also help you establish and maintain a compliant service contract or extended warranty program.

The Service Contracts Compass is designed to assist companies like yours by providing valuable information about changes in laws and regulations which may impact your service contract operation and by offering compliance consulting services that can help you keep pace with the insurance laws and service contract laws that govern your industry.

Depending on how your service contract program is structured, or if you are just starting out, some or all of the questions below may be worth exploring…and we can help!

- Do you wonder about recent law changes and need help implementing them accurately and timely?

- Do you need help developing a strategy to expand your program into other states?

- Are you considering the acquisition of an existing provider or program and need a due diligence audit?

- Do you and your program partners have the right license(s) for the kinds of service contracts that you offer or sell?

- Do you qualify for any exemptions that you may be unaware of?

- Are you calculating and returning refunds accurately in every jurisdiction?

- Should you be charging or collecting state sales tax on the sale of your service contracts?

- Could you benefit from a limited scope operational audit conducted by someone that is “on your team” to help identify potential regulatory problems before a regulator does?

- Do you have a knowledgeable resource who can offer issue-by-issue and state-by-state support for regulatory matters that may arise regarding your service contract program?

Be proactive rather than reactive!  Whether it’s regulatory filing support, contract analysis, or help communicating with a regulator, we have the experience and expertise in the world of service contract laws to offer strategies and solutions for every aspect of your program.

Please explore other areas of this site and be sure to read more about our firm’s practice group and its services. Check out our Service Contract and Extended Warranty Law Services and learn more about our Insurance Regulatory Practice Group.

Legislation & Regulatory Activity

  • 04/14/14
    Michigan Exemption Bill Passes – MV/Home/Consumer Goods

    FINAL UPDATE -  Michigan House Bill 4467  has been signed by the Governor and was effective immediately.    This very important exemption legislation finally settles the regulatory status of service contracts as non-insurance.    This bill defines "service contract" in a manner consistent with a number of states and declares such contracts to not be subject to the state's insurance code.  Nor will the offering of such contracts be subject any other specific registration or financial responsibility requirements.  This bill's defines an exempt contract as on that promises to:      (i) To perform or provide reimbursement for the repair,  replacement, or maintenance read more

    03/27/14
    Washington – Service Contracts – Financial Statements

    Washington Senate Bill 5978 is awaiting the Governor's signature in this state.  This legislation modifies law which currently requires that a service contract provider-applicant wishing to offer consumer goods or vehicle service contracts to furnish audited financial statements in connection with its application for registration.   The new law would permit such an applicant to furnish its most recent two years of financial statements (unaudited) if they are certified by two officers of the company.  This alternative is only available to applicants who will be insuring their programs under a qualifying reimbursement insurance policy.   Applicants that meet Washington's financial responsibility requirement read more

  • 03/26/14
    Indiana – Motor Vehicle Service Contracts

    UPDATE:  This summary is being updated relative to House Bill 1206 which was ordered enrolled on March 18 and is on its way to the Governor's desk for signature.    This was a Department of Insurance "omnibus" bill and includes new law governing motor vehicle service contracts.   Prior to this law, the industry relied upon a long-standing Department bulletin for guidance as to the regulatory treatment and status of vehicle service contracts.      Once signed, House Bill 1206 will provide definitive law relating to offering motor vehicle service contracts including contracts with benefits such as tire & wheel/road hazard protection, paintless dent removal, read more

    02/20/14
    Virginia MV Ancillary Products Legislation Passes

    Today, Virginia House Bill 69 has cleared both the chambers of the Virginia Legislature and is headed for the Governor's desk. This bill amends Virginia's current "extended service contract" law to expressly allow the following ancillary benefits in a vehicle service contract:   - Tire and Wheel/Road Hazard - Dent/Ding - Paintless Dent Removal - Windshield Crack Repair - Key Fob replacement - Vehicle Protection Product-type benefits by allowing protection through installed devices or applied chemicals designed to prevent damage or loss to a vehicle.  Such loss is not limited to theft as are some of the country's early VPP laws. read more

  • 02/02/14
    New Jersey – Service Contracts To Be Regulated

    UPDATE - Finally,  a service contract law the industry can follow in New Jersey.  Senate Bill 854 (companion to previously reported House Bill 1740)  has been signed by the Governor and service contracts will be regulated, but not as insurance.   The Governor's approval ends a very long stretch of legislative efforts by interested parties within the service contract industry and will, once and for all, established a statutory framework for regulation motor vehicle, home and consumer goods service contracts that everyone can understand.    The legislation provides a framework much like the service contract model act adopted in a number of states already.  It read more

    01/12/14
    Florida – Electronic Delivery – Service Contracts

    Legislation was recently introduced in Florida which would amend law governing motor vehicle, home and consumer goods service contracts (a.k.a. motor vehicle service agreements and service/home warranties).  Senate Bill 496 and its companion House Bill 291 propose the following changes:   Allows for electronic delivery of motor vehicle service agreements (MVSA), home warranties and consumer goods warranties.  Current law requires that a copy of the contract be “mailed or delivered to the purchaser with 45 days of purchase” for MV and home.   It does not specifically address delivery of a consumer goods warranty contract; Any electronic transmission employed must notify the read more

  • 08/20/13
    Illinois Expands Vehicle Service Contract Law

    A law amending Illinois’ long-standing service contract law was signed by the Governor last week.  House Bill 1460 expands the definition of “service contract”, also referred to as extended warranties, to expressly authorize the inclusion of popular ancillary benefits such as road hazard/tire & wheel coverage, paintless dent removal, windshield cracks repair and replacement and key / key fob replacement.  The new law also recognizes agreements with benefits relating to the application or installation of protective chemicals, substances, devices or systems which are specifically designed to prevent loss or damage to a motor vehicle from a specific cause, and which include a read more

    07/14/13
    Oregon – MV Ancillary Products Being Added

    UPDATE -  This legislation has been signed by the Governor and will be effective January 1, 2014.  Original Summary:  Oregon Senate Bill 577 proposes to amend the state's Service Contract law to allow various ancillary product benefits to be included in a vehicle service contract.  Current law defines "service contract"  as the traditional type of mechanical breakdown service contract without any reference to ancillary types of benefits.  But this legislation would provide clear authority for the inclusion of benefits relating to damage or loss from road hazard (tire & wheel),  paintless dent removal, windshield crack repair and key/key fob replacement.  The bill also read more

  • 07/13/13
    Nevada – Standards for CLP Insurers Expanding

    FINAL UPDATE - Legislation filed in the State of Nevada broadens who may issue contractual liability policy coverage to service contract providers.  Assembly Bill 213 was approved by the Governor on June 10, 2013 and will become effective January 1, 2014.    Current law prohibits a service contract provider from satisfying the state’s financial responsibility requirement with a CLP issued by an affiliated insurer.    Nevada Assembly Bill 213 (new bill number - language from AB  88 was amended on to AB 213) removes this prohibition in favor of requiring that all such insurers maintain minimum surplus of $15M, or in the alternative, maintain at read more

    06/14/13
    Washington – Service Contract Form Filing Rules

    Washington regulations relating to the filing of vehicle service contract forms (WAC 284-20C-020) were recently revised to require that all future motor vehicle service contract filings be submitted via the NAIC System for Electronic Rate and Form Filing (SERFF).   This requirement is effective July 1, 2013.   Through a recent undated memorandum published by the Washington OIC, the agency advises that it will no longer accept paper filings for VSC forms.   The memorandum does not indicate that these changes are applicable to current content requirements of initial VSC Provider registration filings, which will continue to require a copy of all vehicle service contracts proposed for use read more

The information on this website is provided solely for informational purposes and presents only highly condensed summaries or general information relating to the topics presented. Therefore, it should not be relied upon as a complete record for purposes of regulatory compliance, nor is it intended to furnish legal advice adequate to any particular circumstances.