Bill Text: PA HB1774 | 2009-2010 | Regular Session | Amended

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Bill Title: Further providing for marketing and administration of service contracts being distinct from the business of insurance.

Spectrum: Strong Partisan Bill (Republican 11-1)

Status: (Passed) 2010-10-07 - Act No. 68 [HB1774 Detail]

Download: Pennsylvania-2009-HB1774-Amended.html

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PRIOR PRINTER'S NO. 2286 PRINTER'S NO. 4065
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No. 1774 Session of2009
INTRODUCED BY BOYD, BEYER, CREIGHTON, DeLUCA, DENLINGER, FAIRCHILD, GINGRICH, GODSHALL, MICOZZIE, O'NEILL, PYLE AND VULAKOVICH, JUNE 24, 2009
AS AMENDED ON SECOND CONSIDERATION, HOUSE OF REPRESENTATIVES, JUNE 30, 2010
AN ACT
Amending the act of May 17, 1921 (P.L.682, No.284), entitled "An
act relating to insurance; amending, revising, and
consolidating the law providing for the incorporation of
insurance companies, and the regulation, supervision, and
protection of home and foreign insurance companies, Lloyds
associations, reciprocal and inter-insurance exchanges, and
fire insurance rating bureaus, and the regulation and
supervision of insurance carried by such companies,
associations, and exchanges, including insurance carried by
the State Workmen's Insurance Fund; providing penalties; and
repealing existing laws," further providing for marketing and
administration of service contracts being distinct from the
business of insurance.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. The act of May 17, 1921 (P.L.682, No.284), known
as The Insurance Company Law of 1921, is amended by adding a
section to read:
Section 358. Service Contract Exclusion.--(a) The
marketing, sale, offering for sale, issuance, making, proposing
to make and administration of a service contract shall not be
construed to be the business of insurance and shall be exempt
from regulation as insurance.
(b) "Service contract" means a contract or an agreement for
a separately stated consideration for a specific duration to
perform the service, repair, replacement or maintenance of
property or indemnification for service, repair, replacement or
maintenance, for the operational or structural failure due to a
defect in materials, workmanship or normal wear and tear with or
without additional provisions for incidental payment of
indemnity under limited circumstances, including, but not
limited to, towing, rental and emergency road service, but not <--
including mechanical breakdown insurance. Service contracts may
provide for the service, repair, replacement or maintenance of
property for damage resulting from power surges or accidental
damage from handling, provided, however, that an insurance <--
company providing coverage or payment for towing, rental,
emergency road service or mechanical breakdown insurance shall
not be considered to be providing a service contract; and
further provided that automobile club coverage or payment of
towing, rental or emergency road service shall not be considered
a service contract and shall not be regulated as insurance.
Section 2. This act shall take effect in 60 days.
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