Consumer Tips from the Service Contract Industry Council for Buying Extended Warranties

TALLAHASSEE, Fla., July 8, 2011 – Legislation signed into law by Missouri Gov. Jay Nixon on July 7, 2011 includes important consumer protection language drafted by the Service Contract Industry Council (SCIC) in conjunction with the Missouri Attorney General and impacts consumers nationwide. The law goes into effect Jan. 1, 2012.

The SCIC believes consumers should know that the great majority of service contract (extended warranty) providers are licensed and regulated in the state(s) in which they do business. In addition, the SCIC wants consumers to know their rights during and after the purchase.

WHERE TO PURCHASE A SERVICE CONTRACT (Extended Warranty):

• Most service contracts are sold by retailers at the point of sale, automotive dealerships, or through a realtor. Service contracts also can be obtained after product or vehicle purchase (new or used vehicles) from independent service contract providers or in some cases by returning to the point of purchase.

  Homeowners may purchase a home service contract at any time, regardless of the age of the home or years of occupancy.

• The vast majority of service contracts are sold and/or administered by reputable, licensed companies that abide by current regulations, adhere to high principles of customer service, and are protected by financial reserves and/or insurance.
• A list of service contract providers who are members of the Service Contract Industry Council, a non-profit trade association representing the service contract industry, is available at https://go-scic.com/insidepages/membership.cfm.

  BEFORE PURCHASING A SERVICE CONTRACT (Extended Warranty):

• Ask for a copy of the contract and read the provisions carefully to be sure the terms and benefits fit your needs.
• Only buy from a provider willing to supply a copy of the contract terms and conditions for your review prior to purchase.
• Research the provider and/or contract administrator with the local Better Business Bureau and/or state insurance commissioner. As with any vendor, consumers are urged to research the companies with whom they do business.
• Be alert to providers who use unsolicited mass marketing techniques, such as direct mail and telemarketing (e.g., “robo-calls”), or who misrepresent