2023 New York Laws › ISC - Insurance › Article 79 - Service Contracts › 7905 - Required Disclosures; Service Contract.

§  7905. Required disclosures; service contract. (a) Service contracts
marketed, sold or offered for sale, issued, made, proposed to be made or
administered in  this  state  shall  be  dated  and  written  in  clear,
understandable language and the entire service contract shall be printed
or  typed  in  easy  to  read type and disclose the requirements of this
section, as applicable.  The date the service contract is issued is  not
required  to  be  preprinted on the service contract and may be added or
attached to the service contract at the time of sale.
(b) Service contracts insured under a service  contract  reimbursement
insurance  policy pursuant to paragarph one of subsection (c) of section
seven thousand nine hundred  three  of  this  article  shall  contain  a
statement  in  substantially  the  following form:   "Obligations of the
provider under  this  service  contract  are  insured  under  a  service
contract reimbursement insurance policy. If the provider fails to pay or
provide  service  on  a  claim within sixty days after proof of loss has
been filed, the contract holder is entitled to  make  a  claim  directly
against  the  insurer under the service contract reimbursement insurance
policy." The service contract shall also state the name and address  and
a  toll-free  telephone  number of the insurer under the related service
contract reimbursement insurance policy.
(c)  Service  contracts  not  insured   under   a   service   contract
reimbursement  insurance  policy pursuant to paragraph one of subsection
(c) of section seven thousand nine hundred three of this  article  shall
contain  a statement substantially to the following effect: "Obligations
of the provider under this service contract are backed by the full faith
and credit of the provider." The service contract shall also  state  the
name and address of the provider thereunder.
(d)  Service  contracts  shall identify any administrator if different
from the provider or seller, the  provider,  and  the  service  contract
seller.    The  identities  of  such  parties  are  not  required  to be
preprinted on the service contract and  may  be  added  to  the  service
contract at the time of sale.  Service contracts shall clearly state the
procedure  that  the service contract holder must take to obtain service
under the terms and conditions of the service contract.
(e) Service contracts shall state the total  purchase  price  and  the
terms  and  conditions  under  which  the  service contract is sold. The
purchase price is not required to be preprinted on the service  contract
and  may  be  negotiated  at  the time of sale with the service contract
holder.
(f) If  prior  approval  of  repair  work  is  required,  the  service
contracts shall state the procedure for obtaining prior approval and for
making a claim, including a toll free telephone number for claim service
and  if  the  service  contracts  provide  services  essential to public
health, safety or welfare, the service contracts  shall  either  provide
for  twenty-four  hour  telephone  assistance or state the procedure for
obtaining emergency repairs performed outside of normal business  hours.
The  superintendent  may  promulgate regulations necessary to effectuate
this subsection as authorized by section  seven  thousand  nine  hundred
eleven of this article.
(g)  Service  contracts  shall  state  the existence of any deductible
amount thereunder if applicable.
(h) Service contracts shall specify the merchandise and services to be
provided and any limitations, exceptions  or  exclusions  from  coverage
thereunder if applicable.
(i)  Service contracts covering motor vehicles shall state whether the
use of non-original manufacturers' parts may  be  allowed.    Conditions
stated shall comply with applicable state and federal laws.
(j)   Service   contracts  shall  state  any  terms,  restrictions  or
conditions governing the transferability of such service contracts.
(k)   Service   contracts  shall  state  the  terms,  restrictions  or
conditions governing termination of the service contract by the  parties
to the service contract. The provider of the service contract shall mail
a  written  notice  to  the  service  contract  holder at the last known
address of the service contract holder contained in the records  of  the
provider  at  least  fifteen days prior to cancellation by the provider.
The notice shall state the effective date of the  cancellation  and  the
reason  for  the  cancellation.  Written  notice  is not required if the
reason for cancellation is nonpayment of the provider  fee,  a  material
misrepresentation,  or  a  substantial  breach  of duties by the service
contract holder relating to the covered property or its use.
(l) Service contracts shall set  forth  all  of  the  obligations  and
duties  of  the  service  contract  holder,  such as the duty to protect
against any further damage and any requirement to follow owner's  manual
instructions.
(m)  Service  contracts shall clearly state whether or not the service
contract provides for or excludes preexisting conditions.
(n) Service  contracts  shall  contain  a  statement  of  the  service
contract  holder's  right  to return the contract within at least twenty
days of the date of mailing of the service contract or within  at  least
ten days if the service contract is delivered at the time of the sale or
within  a  longer  time period permitted under the contract. If no claim
has been made under the contract, the contract shall  be  void  and  the
provider  shall refund to the contract holder the full purchase price of
the contract.  The service contract shall also contain a statement  that
a  ten  percent penalty per month shall be added to a refund that is not
made within thirty days of return of the contract to the provider.