Need help navigating the service contract, extended warranty or GAP waiver regulatory process?

If you are a provider, administrator, seller or insurer of service contracts or GAP waivers; or want to be, let us be your guide to all the state service contract/extended warranty and GAP waiver 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, extended warranty or GAP 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 or GAP waiver programn and by offering compliance consulting services that can help you keep pace with the insurance laws. service contract laws and GAP waiver 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?

– 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

  • 12/30/23
    TEXAS – Residential Service Contracts (Home Warranties)

    REMINDER:  Residential Service Companies originally licensed by the Texas Real Estate Commission (TREC) must register with the Texas Department of Licensing and Regulation (TDLR) by January 1, 2024.  Such TREC registrations will no longer be valid after this date.    Background:   House Bill 1560, passed in 2021, transferred responsibility for oversight of the Residential Service Companies (Home Warranties) (RSC)  from the Texas Real Estate Commission (TREC) to Texas Department of Licensing and Regulation (TDLR).  This transfer was effective on September 1, 2021.   Since that time, Residential Service Companies licensed under TREC were permitted to continue operating under that registration read more

    07/15/23
    NEW JERSEY – New Registrations Now Required

    Amendments to New  Jersey’s Service Contract law are effective on August 1, 2023.   The new law establishes a registration require for both administrators and providers (obligors).  Previously, New Jersey's law required neither. The NJ Department of Consumer Affairs has posted the new registration application with instruction on its website.  Check it out at the link below.   https://www.njconsumeraffairs.gov/regulated/Pages/default.aspx   *** For more information about this and other regulatory activity or legislation affecting these industries, visit us at www.servicecontractscompass.com   read more

  • 03/17/23
    COLORADO – Home Warranty Service Contracts

    Colorado House Bill 1134 has been enacted in this state and amends Colorado’s requirements for home warranty service contracts issued pursuant to Title 12, Article 10 regulated by the Division of Real Estate.   Current law defines “home warranty service contract” as:   “any contract or agreement whereby a person undertakes for a predetermined fee, with respect to a specified period of time, to maintain, repair, or replace any or all of the following elements of a specified new or preowned home:   Structural components, such as the roof, foundation, basement, walls, ceilings, or floors; Utility systems, such as electrical, read more

    03/16/23
    COLORADO – GAP Waivers

    House Bill 1181 has been introduced in the State of Colorado.  The bill intends to codify regulations applicable to GAP waivers previously addressed in regulations of the Uniform Consumer Credit Code.   According to materials filed with this legislation, codifying and updating the GAP agreement rules that are in the code of Colorado regulations, the general assembly will provide Colorado consumers with stability, predictability, and efficiency  regarding GAP agreements, while ensuring a fair and viable market for  GAP agreement providers and making important updates to the laws that  govern these agreements.   Specifically, the legislation:   Sets conditions and read more

  • 08/07/22
    New Jersey – Registration for Providers & Administrators

    UPDATE - Senate Bill 902 (Companion to AB 1559) has been approved and will become effective on or about September 1, 2023....yes, a little over a year from now!   Senate Bill 902, provides for the following:   Establishes a registration require for both administrators and providers (obligors).  Previously, New Jersey's law required neither. A new prohibition on certain words that can be used in a provider’s name, products, description of products and “other materials”. Current law only limits certain words in a provider’s name and those words are “insurance”, “casualty”  or “surety”.    The legislation proposes to specific requirements around read more

    11/21/21
    Texas – Residential Service Contracts – New Regulator

    The announcement below is from the Texas Department of License and Regulation (TDLR) regarding the transfer of the regulation of residential service contracts from the Texas Real Estate Commission to TDLR. *********************************** Save the Date!   The Texas Department of Licensing and Regulation (TDLR) will host a virtual Residential Service Companies (Home Warranties) Informational Summit via Microsoft Teams on Tuesday, December 14, 2021. The summit is tentatively scheduled from 10:00 a.m. to 11:30 a.m. (CST) with a short break at the halfway point, followed by a Q&A where you will have an opportunity to ask questions about TDLR and the read more

  • 10/28/21
    North Carolina -Vehicle Value Protection Agreements & GAP

    *UPDATE*  The Governor has signed this bill - it will be effective 1/1/22. North Carolina Senate Bill 425 was presented to the Governor last week.  If signed, it will amend the state’s GAP Waiver law and create a new F&I product called Vehicle Value Protection Agreement (VVPA).     The current GAP law is amended to allow GAP waivers to be offered at no charge.  It also amends the definition of a GAP waiver to now include an agreement that would offer a benefit that would provide the borrower with  a credit towards the purchase of a replacement vehicle, in addition read more

    10/17/21
    California – Consumer Goods Service Contracts

    California Assembly Bill 1221 has been signed by the Governor and will be effective January 1, 2022.   This legislation addresses ambiguities within California's Song-Beverly Act which governs consumer product warranties in this state.  This legislation provides two important clarifications to existing law:  1)  to permit coverage to a group or "class" of products in a single service contract, and 2) to permit automatic renewals of service contracts.   Current law, which refers to a service contract covering "a consumer product", has been interpreted by regulators to allow only one product to be covered under a single contract.   Current law also requires read more

  • 10/15/21
    Texas – Residential Service Contracts – New Regulator

    UPDATE:  The Texas Department of Licensing and Regulation (TDLR) recently indicated that it hopes to publish the new license application for residential (home) service contract providers.  Despite the effective date of the transfer from the Texas Real Estate Commission to the TDLR of September 1, 2021, the application is not yet available for filing.  Stay tuned to the https://servicecontractscompass.com for updates. ****** Texas House Bill 1560 was enacted earlier this year which transfers the regulation of Residential Service Companies (RSCs) from the Texas Real Estate Commission (TREC) to the Texas Department of Licensing and Regulation (TDLR).   H.B. 1560 requires TDLR to read more

    05/23/21
    GEORGIA – Service Contracts and Lease W&T

    New cancellation and claims deduction rules will be in effect July 1, 2021.  Georgia House Bill 241 has been signed by the Governor and provides new rules relating to service contract cancellations and refunds.   This new law expands benefits allowable under vehicle service contracts to include lease-end excess wear and use charges benefits as well as key/key fob replacement when inoperable, lost or stolen.  The new law also codifies long-standing Department of Insurance policy by expressly carving out from regulation certain service contracts offered by subsidiaries or affiliates of a motor vehicle manufacturer.  Interestingly,  there remains a drafting "glitch" in the 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.  (c) Copyright Shirley F. Kerns 2016