| (a) The provider must clearly and conspicuously identify
itself on all written service contracts and, on all written advertising
materials that are used by the provider, its administrator(s), or
its seller(s).
(b) The provider and/or any administrator appointed
by the provider must provide service contract holders with a notification
that meets all of the following requirements.
(1) The notification must provide the name, mailing
address, and telephone number of the department.
(2) The notification must contain a statement that
unresolved complaints concerning providers and administrators or questions
concerning the regulation of service contract providers and administrators
may be addressed to the department.
(3) The notification must be included on all written
service contacts. The notification may be stamped on the contract
or printed on a separate sheet and stapled to the contract.
(c) The provider and/or any administrator appointed
by the provider must provide service contract holders with the provider's
complaint resolution procedures.
(d) The provider and/or any administrator appointed
by the provider must disclose the following information to service
contract holders:
(1) the specific contract provisions and required disclosures
in accordance with Texas Occupations Code §§1304.156 and
1304.157;
(2) the procedures and timeframes for a service contract
holder to cancel a service contract in accordance with Texas Occupations
Code §1304.1581;
(3) the procedures and timeframes for a provider to
refund the purchase price of the service contract and pay any applicable
penalty to the service contract holder in accordance with Texas Occupations
Code §1304.1581; and
(4) the conditions in which the provider may cancel
a service contract and issue a refund in accordance with Texas Occupations
Code §1304.159.
(e) As part of the disclosures required under subsection
(d), a provider and/or any administrator appointed by the provider
who sells or issues service contracts described under Texas Occupations
Code §1304.003(a)(2)(B) (referred herein as "identity recovery
service contracts") must disclose the following information:
(1) the person or persons who are covered under the
identity recovery service contract;
(2) the price of the identity recovery service contract
separate from the purchase price of the automobile and any other products
or services that are financed with the vehicle;
(3) the term of the identity recovery service contract;
and
(4) any conditions that may change the stated term
of the identity recovery service contract, including if the identity
recovery service contract holder:
(A) pays off the automobile early;
(B) makes late payments or defaults on the payments
on the automobile;
(C) refinances the automobile; or
(D) sells or transfers title to the automobile.
(f) As part of the disclosures required under subsection
(d), a provider and/or any administrator appointed by the provider
who sells or issues service contracts described under Texas Occupations
Code §1304.003(a)(2)(C) (referred herein as "depreciation benefit
service contracts") must disclose the following information:
(1) the names and locations of the participating dealers
who are part of the depreciation benefit optional member program;
(2) the amount of the credit that will be paid or the
method of calculation that will be used to pay the credit toward the
purchase of a replacement vehicle;
(3) a statement that purchase of the service contract
is not required as a condition of approval of a loan for the purchase
of a vehicle;
(4) a statement that a service contract may not be
offered by a dealer who requires a loan for the purchase of a vehicle
to be financed exclusively with the dealer; and
(5) a statement that the service contract may be cancelled
by the service contract holder and the procedures and timeframes for
a service contract holder to cancel the service contract and obtain
a refund as specified under subsections (d)(2) and (d)(3).
(g) If not provided by the seller at the time of sale,
the provider and/or any administrator appointed by the provider must
provide a copy of the service contract to the service contract holder
within a reasonable amount of time after the date of purchase that
still allows the service contract holder the opportunity to cancel
the contract and receive a full refund.
(h) If not provided by the seller at the time of sale,
the provider and/or any administrator appointed by the provider must
provide a receipt for or other written evidence of the purchase of
a service contract to the service contract holder within a reasonable
amount of time after the date of purchase that still allows the service
contract holder the opportunity to cancel the contract and receive
a full refund.
(i) A provider shall report to the department within
30 days any change in information required by §77.20 and §77.21.
(j) An administrator shall report to the department
within 30 days any change in information required by §77.22 and §77.23.
(k) Upon notification by the department, the provider
and/or any administrator appointed by the provider shall allow the
department to audit records required to be maintained by Texas Occupations
Code Chapter 1304. These records include copies of the service contracts
marketed, sold, administered or issued in this state.
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| Source Note: The provisions of this §77.70 adopted to be effective November 16, 2009, 34 TexReg 7791; amended to be effective March 1, 2012, 37 TexReg 1319; amended to be effective October 22, 2013, 38 TexReg 7305; amended to be effective July 1, 2018, 43 TexReg 3873; amended to be effective June 13, 2024, 49 TexReg 4035 |
