Compliance Alerts

July 2019

Effective State Changes  

 

DELAWARE

Governor John Carney signed House Bill 106 into law on June 26, 2019. This bill codifies existing legal practice allowing the Department of Justice to regulate service contracts and product warranties. These contracts and products are not regulated like insurance products. The Department of Justice began regulating these markets following a letter issued by the Department of Insurance in 1993 and Domestic/Foreign Insurers Bulletin No. 5 in 1997. Effective immediately.

 

HAWAII

On June 26, 2019 Governor David Ige signed House Bill 154 into law. The legislation clarifies the scope of motor vehicle service contracts subject to regulation by the Department of Insurance. Services specifically allowed in this bill include the repair or replacement of tires following contact with road hazards, the use of paintless dent removal services, windshield replacement from road hazard damage, and the replacement of key-fobs. Effective in part on July 1, 2019.

 

Senate Bill 409 was signed into law by the governor on July 10, 2019. The bill establishes an annual registration surcharge of $50.00 for electric and alternative fuel vehicles. Effective January 1, 2020.

 

MAINE

Senate Bill 995 was signed by the governor on June 20, 2019. This bill establishes a Student Loan Bill of Rights and regulates student loan servicers. Additionally, the bill institutes a licensing procedure for servicers, complete with a background investigation. Effective January 1, 2020.

 

NEW JERSEY

Governor Phil Murphy signed Senate Bill 2994 on July 19. The act requires GAP waivers to be cancellable and requires a pro rata refund of the purchase price following the cancellation of such waiver. A fee no greater than $50 may be deducted from the refund. The law also requires any refund due from early termination to be received within 60 days of termination or the receipt of such termination. Effective October 17, 2019.

 

NORTH CAROLINA

On July 5, 2019, Senate Bill 529 became law in North Carolina. This legislation changes the processing fee for a returned check from $25 to $35. Effective October 1, 2019.

 

RHODE ISLAND

House Bill 5674 was signed July 15, 2019 by Governor Gina Raimondo. This act would define service contracts and clarify that service contracts are not insurance and not subject to the insurance code. This legislation defines service contracts and details numerous items which are subject to removal, replacement, or repair. Effective January 1, 2020.

 

TEXAS

House Bill 4390 was signed into law on June 14, 2019 by Governor Greg Abbott. This legislation increases the requirements following a computerized-data breach of sensitive personal information. The bill inserts a 60-day limit to notify the Attorney General of said breach and details the information which must be included in the notification. Effective January 1, 2020.

 

VERMONT

Senate Bill 18 / Act 74 became law in Vermont without the Governor’s signature on June 19, 2019. The law is entitled the “Model State Consumer Justice Enforcement Act” and lists out numerous terms which are prohibited in standard-form contracts. Unconscionable terms include a waiver to an individual’s right to a jury trial, a waiver of an individual’s right to seek punitive damages, and any requirement that resolution of legal claims must take place in an “inconvenient venue.” Additionally, this legislation provides for damages, attorney’s fees, and a reasonable cost reimbursement if the drafting party includes any of these unconscionable provisions in a standard-form contract and a court determines an unfair and deceptive practice has been committed. Effective October 1, 2020.