Legislation recently filed in Florida would establish new standards for issuing refunds relating to cancelled motor vehicle service warranties. Current law permits refunds to be “effectuated” through the retail seller of the MV service agreement. Senate Bill 1262 proposes new requirements for how the unearned premium, including the corresponding unearned commission and sales tax, are to be refunded to the consumer. In addition, the legislation establishes specific records that must be maintained relating to refund.
In the case of a consumer goods service warranty, the legislation provides that refunds can be made by a variety of means, including store credit or gift cards. However, it does not mandate that specific records be maintained about the refund. And in the case of a home warranty, the legislation would now similarly allow refunds to be processed through the retail seller of the home warranty, (which is not currently provided for under current law), but does not mandate specific records relating to such refunds.
The new law also removes a current mandate that the Office of Insurance Regulation examine service warranty companies every five years and instead, provides authority to the Office to do so at its discretion.
