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View NCGA Bill Details2023-2024 Session
Senate Bill 857 (Public) Filed Thursday, May 2, 2024
Intro. by Mohammed.

Status: Ref To Com On Rules and Operations of the Senate (Senate action) (May 6 2024)

Bill History:

S 857

Bill Summaries:

  • Summary date: May 2 2024 - View Summary

    Identical to H 957, filed 5/1/24.

    Creates protections related various agreements, including newly defined term service agreements, that apply to all of Article 43 (pertaining to service agreements) in GS Chapter 66 [hereinafter Article 43], as follows. 

    Recodifies GS 66-372(b) (currently titled as the definitions provisions to the miscellaneous requirements for motor vehicle and home appliance service agreement companies) as to new GS 66-369.1 (definitions), which now applies to all of Article 43.  Defines consumer and covered items.  Changes the definition of service agreements to an agreement between a consumer and a service agreement company in which a consumer agrees to pay a set fee or premium, and may agree to pay a deductible, in exchange for a service provider promising to repair, replace, or maintain a set list of covered items. This term includes agreements where the service provider facilitates but does not actually perform the repair, replacement, or maintenance of a covered item and agreements where a service provider reimburses the consumer for obtaining their own repair, replacement, or maintenance. (Currently, just specifies that it includes motor vehicle and home appliance agreements). Expands entities included in a service agreement company to include a person, other than an insurer licensed to write liability insurance under Article 7 or 16 of GS Chapter 58, that issues service agreements. (Currently, just specifies that it includes motor vehicle and home appliance agreements). Makes organizational changes.

    Recodifies subsections (a), (c), (d), the remainder of (e), (f), (h), (i), (j), and (l) of GS 66-372 as subsections  (a), (b), (c), (d), (e), (f), (g), (h), and (i), respectively, of GS 66-369.2 (now entitled Miscellaneous requirements for service agreements) and makes the following changes to new GS 66-369.2. Specifies that the statute's requirements apply to all service agreements in Article 43. Makes organizational, technical, and conforming changes. Requires service agreements to contain a list of covered items. 

    Recodifies GS 66-373 as GS 66-369.3 (insurance policy requirements) to require each person or company subject to Article 43 (currently, subject to GS 66-373) to now maintain insurance with an insurer authorized to write liability insurance under Articles 7.16.21 or 22 of GS Chapter 58 (currently, just need to have coverage under an authorized insurer). Amends the scope of GS 66-369.3 so that it applies to GS 58-1-15, GS 58-1-20, and Article 43 (currently applies to GS 58-1-15, GS 58-1-20, GS 66-370, GS 66-371, and GS 66-374).

    Amends GS 66-371 (pertaining to home service agreements [currently, home appliance service agreement companies]) as follows. Expands Article 43’s scope to all home service agreements in the State. (Currently, section applies to all home appliance service agreement companies soliciting business in the State.) Defines home service agreements as a service agreement for a set list of appliances and systems in a residence, regardless of whether the agreement is titled as a contract, home warranty, extended home warranty, home appliance warranty, or other.

    In addition to the general requirements pertaining to a service agreement set forth above, requires home service agreements to contain four required elements, including a list of covered items, detailed descriptions of covered losses or damages and exclusions, and a statement of the purchaser’s rights. Requires home service agreement companies to provide an electronic or paper copy of the agreement to the consumer at time of signing, maintain a list of company-approved vendors available to perform services and allow a consumer to use one of those vendors, and ensure that the repair, replacement, or maintenance requested under the agreement is completed or scheduled for completion within five business days of a consumer's claim for any covered item that is necessary for heating, air-conditioning, or the functioning of a bathroom if there is only one bathroom in the residence. Makes conforming changes. Deletes defined terms home appliance and home appliance service agreement.

    Recodifies GS 66-372(e)(2) as GS 66-370(a2), and further amends GS 66-370 as follows. Defines motor vehicle. Expands Article 43’s scope to all motor vehicle service agreements in the State. (Currently, section applies to all motor vehicle service agreement companies soliciting business in the State.) Defines motor vehicle service agreement as including (1) any contract or agreement indemnifying a consumer against loss caused by a motor vehicle failure (defined) that is listed in the agreement or providing for the repair of a motor vehicle failure that is listed in the agreement; and (2) a contract or agreement to reform or to indemnify a consumer for certain repairs, including dents, key fobs, and other services that may be approved by the Commissioner of Insurance if not inconsistent with Article 43. Specifies that the general requirement set forth in GS 66-369.2 above, apply to motor vehicle service agreements. Makes technical and organizational changes. Deletes defined terms set forth in GS 66-370(b).

    Effective October 1, 2024, and applies to service agreements entered into on or after that date.

    Appropriates $50,000 in recurring funds from the General Fund to the Department of Justice to be allotted to the Office of the Attorney General to enforce Article 43, as amended by the act. Effective July 1, 2024.