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

  • 03/18/15
    Utah – Ancillary Products and VPP

    Utah House Bill 24 has cleared both chambers of the Legislature and has been ordered for Enrollment.   Once signed by the Governor, the new law will be effective October 1, 2015, and the state’s service contract will be amended to allow certain ancillary benefits to be offered under a vehicle service contract.   The bill amends the definition of “service contract” to allow for the following:   Tire & Wheel damage due to Road Hazard Paintless Dent Removal Windshield Crack/Chip Repair Key & Key Fob Replacement   The new legislation also provides for offering Vehicle Protection Product contracts.  In this case, read more

    Massachusetts – Motor Vehicle Service Contracts

    A bill recently introduced in Massachusetts proposes to amend the state's existing service contract law by allowing contracts covering motor vehicles.  Currently, the Massachusetts Division of Insurance considers a motor vehicle service to be a contract of insurance unless it is dealer-obligated or manufacturer-obligated and covering that manufacturers' own make of vehicles.   House Bill 258 amends the definition of "service contract" to include apply to "consumer products" rather than "tangible personal property" and now would specifically include motor vehicles.  Current law already applies to service contracts covering homes and consumer goods.   The bill would also allow a motor vehicle service contract to read more

  • 02/23/15
    Arizona – Motor Vehicle Ancillary Benefits Proposed

    Legislation has been introduced in Arizona that would amend and expand the state's existing service contract law to allow additional ancillary benefits to be offered under a vehicle service contract.   Arizona House Bill 2329 will amend the definition of “service contract” to allow for the following:       Tire & Wheel damage due to Road Hazard Paintless Dent Removal Windshield Crack/Chip Repair Key & Key Fob Replacement   The legislation would not allow for the repair of damage to, or replacement of, interior surfaces or exterior painted surfaces of a vehicle unless the coverage is provided through the sale of read more

    Oklahoma – Service Warranty Sales Rep Licensure

    Senate Bill 823 proposes to amend the state’s Service Warranty Act, in part, by requiring licensure and appointment of sales representatives, i.e., those who act as the retail seller of a service warranty.    This bill would apply to motor vehicle and consumer goods service warranties.   Regulation of home service contracts would be unaffected by this legislation.    The bill also proposes new provisions relating to enforcement and prohibited acts  If enacted, the law would become effective November 1, 2015 read more

  • 02/12/15
    Hawaii – Notice to Service Contract Holders

    Hawaii House Bill 1422 would create a new section within the state’s current Service Contract Law applicable to motor vehicle, consumer goods and home service contracts.  It would require Providers (Obligors) to specifically disclose to service contract holders submitting a claim for the first time, that if a covered claim is paid within the prescribed “Free Look” period of the law (i.e., within 30 days of the date that the contract was mailed to the contract holder; or  20 days of the date the contract was delivered to the contract holder, if the contract was delivered at the time of read more

    Maryland – Motor Vehicle Service Contracts

    Maryland House Bill 630 (and companion SB 432) would allow for new ancillary benefits to be included in a vehicle service contract.  In Maryland, such contracts are currently defined in Section 15-311.2 of the state’s Transportation Code as “mechanical repair contracts”.  Currently, such contracts are defined as “any agreement or contract sold by a licensed vehicle dealer under which a specified provider agrees to perform over a fixed period of time, for a specific duration and for a specific identifiable price, services relating to the maintenance or repair of a motor vehicle, provided that the purchase of the contract is read more

  • 01/23/15
    Colorado Home Warranty Service Contracts

    A bill recently introduced in Colorado would expand the regulation of home-related service contracts currently administered under Title 12 – Professions and Occupations; Article 61 – Real Estate.  This section of law currently applies only to home warranty service contracts cover pre-owned homes and specifically does not apply to the same type of contract covering new homes.  Depending upon how benefits under a home warranty service contract are provided relative to new homes today, such contracts can be deemed to be contracts of insurance by the state’s Division of Insurance.    Under House Bill 1223, Title 12-61-602 of the Professions read more

    Kentucky – Sale of VSC’s – May Be Insurance?

    UPDATE:  On March 15, 2013, the Office of Insurance of the Commonwealth of Kentucky issued Advisory Opinion 2013-03 concerning motor vehicle service contracts.    It did so in response to numerous inquiries regarding the repeal of its administrative regulation 806 KAR 5:050, as well as what the DOI described as inconsistencies in 304.5-070(1)(p) of Kentucky’s Insurance laws.  This administrative regulation previously imposed registration requirements of certain motor vehicle service contract providers.   According to the DOI, these inconsistencies were brought about through amendments to 190.090, which is found in Kentucky’s law governing Motor Vehicle Sales.  The opinion was issued to clarify read more

  • 09/15/14
    Alaska – MV Service Contracts with Ancillary Benefits

    At long last, Alaska will no longer regulate motor vehicle service contracts as insurance.  Earlier this year, the Alaska Legislature amended the state’s Insurance Code to establish a statutory framework specifically regulating motor VSCs as non-insurance products.     House Bill 206  will be effective January 1, 2014, and will require licensure of both VSC providers (obligors) as well as VSC administrators.    The new law will require providers to demonstrate financial responsibility by either insuring their programs under a qualifying reimbursement insurance policy or maintaining a net worth of $100 million.  Manufacturer-obligated VSCs are exempt if they cover the manufacturer’s own read more

    Colorado – Service Contracts for Consumer Products

    Earlier this year, the Colorado Legislature enacted new law within the state's Insurance Code to govern the sales of a consumer goods service contract.  House Bill 1199 was signed by the Governor in May and will become effective January 1, 2015. This new law establishes a framework for regulating such contracts, in a manner comparable to that which is in place in a number of states.  It contains the following:   - Providers (obligors) are required to register with the Commissioner of Insurance;   - Defines "consumer product" as "any tangible personal property that is distributed in commerce and is 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.