In an effort to help our clients and agent-partners stay informed about important regulatory issues, our Compliance Department is now providing updates on legislation that has the potential to affect our Industry.

If you have any questions or concerns regarding any of these posts, please call Client Services at 866-414-3867, or email Client Services. We will be happy to assist you.


REGULATORY UPDATES


HB 36 has been passed by the Utah legislature and has been signed by the governor of the state.  It will become effective May 10, 2016. 
 
1591     (2) (a) A service contract may not be issued, sold, or offered for sale in this state unless
1592     the service contract contains the following statements in substantially the following form:
1593     (i) "Obligations of the provider under this service contract are guaranteed under a
1594     service contract reimbursement insurance policy. Should the provider fail to pay or provide
1595     service on any claim within 60 days after proof of loss has been filed, the contract holder is
1596     entitled to make a claim directly against the Insurance Company."; and
1597     (ii) "This service contract or warranty is subject to limited regulation by the Utah
1598     Insurance Department. To file a complaint, contact the Utah Insurance Department."
1599     (iii) A service contract or reimbursement insurance policy may not be issued, sold, or
1600     offered for sale in this state unless the contract contains a statement in substantially the
1601     following form, "Coverage afforded under this contract is not guaranteed by the Property and
1602     Casualty Guaranty Association."
1603     (b) A vehicle protection product warranty may not be issued, sold, or offered for sale in
1604     this state unless the vehicle protection product warranty contains the following statements in
1605     substantially the following form:
1606     (i) "Obligations of the warrantor under this vehicle protection product warranty are
1607     guaranteed under a reimbursement insurance policy. Should the warrantor fail to pay on any
1608     claim within 60 days after proof of loss has been filed, the warranty holder is entitled to make a
1609     claim directly against the Insurance Company."; and
1610     (ii) "This vehicle protection product warranty is subject to limited regulation by the
1611     Utah Insurance Department. To file a complaint, contact the Utah Insurance Department."
1612     [(b) A service contract or reimbursement insurance policy may not be issued, sold, or
1613     offered for sale in this state unless the contract contains a statement in substantially the
1614     following form, "Coverage afforded under this contract is not guaranteed by the Property and
1615     Casualty Guaranty Association."]
1616     (c) A vehicle protection product warranty, or reimbursement insurance policy, may not
1617     be issued, sold, or offered for sale in this state unless the warranty contains a statement in
1618     substantially the following form, "Coverage afforded under this warranty is not guaranteed by
1619     the Property and Casualty Guaranty Association."
1620     (3) A service contract and a vehicle protection product warranty shall:
1621     (a) conspicuously state the name, address, and a toll free claims service telephone
1622     number of the reimbursement insurer;
1623     (b) (i) identify the service contract provider, the seller, and the service contract holder;
1624     or
1625    (ii) identify the warrantor, the seller, and the warranty holder;
 
If you wish to view the entire bill the citation is:  http://le.utah.gov/~2016/bills/static/HB0036.html
 

HB 7 has been passed by the Alabama legislature and is awaiting signature by the governor of the state.  It will become effective the 1st day of the 3rd month following the Governor's approval.  This includes SPECIFIC mention of certain ancillary products, by amending Alabama State Statute 8-32-2:
 
Service contract services include, but are not limited to, the following:
a. The repair or replacement of tires or wheels, or both, on a motor vehicle damaged as a result of coming into contact with a road hazard.
 
b. The removal of dents, dings, or creases on a motor vehicle that may be repaired using the process of paintless dent removal without affecting the existing paint finish and without replacing vehicle body panels, sanding, bonding, or painting.
 
c. The repair of chips or cracks in or the replacement of a motor vehicle windshield as a result of damage caused by a road hazard that is primary to the coverage offered by the motor vehicle owner's motor vehicle insurance policy.
 
d. The replacement of a motor vehicle key or key-fob if the key or key-fob becomes inoperable, lost, or stolen.
 
e. Other services which may be approved by the commissioner, if not inconsistent with this chapter.
 
Previously these products were NOT specifically mentioned in the Alabama Service Contract statute.