407.2070. Agreement disclosures.

531 words·~2 min read·/mo/chapter-407/407-2070

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

407.2070. Agreement disclosures. — Vehicle value protection agreements shall disclose in writing and in clear, understandable language that is easy to read the following:

(1)The name and address of the provider, contract holder, and administrator, if any;

(2)The terms of the vehicle value protection agreement including, but not limited to, the purchase price to be paid by the contract holder, if any, the requirements for eligibility, the conditions of coverage, and any exclusions;

(3)A statement that the vehicle value protection agreement may be cancelled by the contract holder within a free-look period as specified in the vehicle value protection agreement and that in such event the contract holder shall be entitled to a full refund of the purchase price paid by the contract holder, if any, so long as no benefits have been provided;

(4)The procedure the contract holder shall follow, if any, to obtain a benefit under the terms and conditions of the vehicle value protection agreement, including, if applicable, a telephone number or website and address where the contract holder may apply for a benefit;

(5)A statement that indicates whether the vehicle value protection agreement may be cancelled after the free-look period and the conditions under which it may be cancelled, including the procedures for requesting any refund of the unearned purchase price paid by the contract holder;

(6)If the vehicle value protection agreement is cancellable after the free-look period, a statement that any refund of the unearned purchase price of the vehicle value protection agreement shall be calculated on a pro rata basis;

(7)A statement that any extension of credit, terms of the credit, or terms of the related motor vehicle sale or lease shall not be conditioned upon the purchase of the vehicle value protection agreement;

(8)The terms, restrictions, or conditions governing cancellation of the vehicle value protection agreement before the termination or expiration date of the vehicle value protection agreement by either the provider or the contract holder. The provider of the vehicle value protection agreement shall mail a written notice to the contract holder at the last known address of the contract holder contained in the records of the provider at least five days before cancellation by the provider. Prior notice shall not be required if the reason for cancellation is nonpayment of the provider fee, a material misrepresentation by the contract holder to the provider or administrator, or a substantial breach of duties by the contract holder relating to the covered product or its use. The notice shall state the effective date of the cancellation and the reason for the cancellation. If a vehicle value protection agreement is cancelled by the provider for a reason other than nonpayment of the provider fee, the provider shall refund to the contract holder one hundred percent of the unearned pro rata provider fee paid by the contract holder, if any. If coverage under the vehicle value protection agreement continues after a claim, any refund may deduct claims paid. A reasonable administrative fee may be charged by the provider up to seventy-five dollars; and

(9)A statement that the agreement is not an insurance contract.

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(L. 2023 S.B. 398)