C.R.S. Section 10-4-1603
Requirements for sale of consumer goods service contracts

  • definitions

(1)

A provider may appoint an administrator or other designee to be responsible for any or all of the administration of service contracts issued by the provider and for compliance with this part 16.

(2)

A provider shall not issue, sell, or offer for sale a service contract unless the provider has:

(a)

Provided a receipt for, or other written evidence of, the purchase of the service contract to the contract holder; and

(b)

Provided a copy of the service contract to the service contract holder before or within a reasonable period of time after the date of purchase.

(3)

Upon a consumer’s request, a provider shall provide the consumer with a complete sample copy of the service contract terms and conditions or direct the consumer to a website containing a complete sample of the terms and conditions of the service contract.

(4)

Intentionally left blank —Ed.

(a)

A provider shall assure faithful performance to its service contract holders by complying with one or more of the following:

(I)

Insuring all service contracts under a reimbursement insurance policy issued by a licensed insurer; or

(II)

Maintaining, or together with its parent company maintaining, a net worth or stockholders’ equity of at least one hundred million dollars.

(b)

For the purposes of subparagraph (II) of paragraph (a) of this subsection (4), a provider shall:

(I)

Upon the commissioner’s request, provide a copy of the provider’s or provider’s parent company’s most recent form 10-K or form 20-F filed with the federal securities and exchange commission; or

(II)

If the company does not file with the federal securities and exchange commission, provide, upon the commissioner’s request, a copy of the company’s audited financial statements showing a net worth of the provider or its parent company of at least one hundred million dollars; or

(III)

If the provider’s parent company’s form 10-K, form 20-F, or financial statements are filed to meet the requirements of this subsection (4), agree to guarantee the obligations of the provider relating to service contracts sold by the provider in this state.

(c)

Except for the requirements set forth in this subsection (4), the commissioner shall require no other financial security requirements for service contract providers.

(5)

Intentionally left blank —Ed.

(a)

A provider must permit the service contract holder to void the service contract by returning it within twenty days after the date the service contract is mailed to the service contract holder or within ten days after delivery if the service contract is delivered to the service contract holder at the time of sale. The service contract is void when the service contract holder returns the service contract to the provider, and the provider shall refund to the service contract holder, or credit the account of the contract holder, the full purchase price of the service contract.

(b)

A service contract may establish a return period greater than twenty days.

(c)

The right to void the service contract is not transferable and applies only to the original service contract purchaser.

(d)

The right to void the service contract does not apply if a claim has been made prior to the return of the service contract to the provider.

(e)

If a refund of a service contract provider fee is not paid or credited within forty-five days after the return of the service contract under this subsection (5), then a ten percent penalty per month shall be added to the refund.

(6)

Intentionally left blank —Ed.

(a)

After the time specified in subsection (5) of this section, or if a claim has been made within that time, a service contract holder may cancel the service contract. Upon cancellation, the provider shall refund to the contract holder one hundred percent of the unearned pro rata provider fee, less any claims made.

(b)

A provider may charge a reasonable administrative fee, not to exceed ten percent of the gross provider fee paid by the service contract holder.

(7)

Intentionally left blank —Ed.

(a)

The provider may cancel a service contract upon mailing, at least five days prior to the date of cancellation, a written notice to the service contract holder at the contract holder’s last-known address contained in the provider’s records. The notice must state the effective date of the cancellation and the reason for the cancellation.

(b)

Prior notice is not required if the reason for cancellation is nonpayment of the provider fee, a material misrepresentation by the service contract holder to the provider, or a substantial breach by the service contract holder relating to the covered product or its use.

(c)

If the provider cancels a service contract for a reason other than nonpayment of the provider fee, the provider shall refund to the service contract holder one hundred percent of the unearned pro rata provider fee, less any claims paid.

(8)

Intentionally left blank —Ed.

(a)

Provider fees collected on service contracts are not subject to premium taxes.

(b)

Premiums for reimbursement insurance policies are subject to applicable taxes.

(9)

Intentionally left blank —Ed.

(a)

Providers, related service contract sellers, and administrators are exempt from any licensing requirements of this state set forth in this title.

(b)

Intentionally left blank —Ed.

(I)

Each provider of service contracts sold in Colorado shall register with the commissioner. The registration must contain the provider’s name, full corporate address, telephone number, and the name of an individual contact person. In addition, the provider shall designate an agent for service of process in Colorado. The provider shall give the commissioner written notice of any change in this information within thirty days after the change.

(II)

Upon initial registration, and annually thereafter, each provider that registers pursuant to this paragraph (b) shall pay to the commissioner a fee, set by the commissioner, in an amount sufficient to defray the commissioner’s direct and indirect costs of administering this part 16 and subject to periodic adjustment in accordance with section 24-75-402, C.R.S.

(10)

With the exception of the requirements set forth in this part 16, the marketing, sale, offering for sale, issuance, making, proposing to make, and administration of service contracts by providers, related service contract sellers, and administrators are exempt from the requirements of this title.

Source: Section 10-4-1603 — Requirements for sale of consumer goods service contracts - definitions, https://leg.­colorado.­gov/sites/default/files/images/olls/crs2023-title-10.­pdf (accessed Oct. 20, 2023).

10‑4‑101
Legislative declaration 10‑4‑102
Federal “voluntary fair access to insurance required, property insurance program” - state qualification 10‑4‑103
Voluntary partial payment of liability claims without admission of liability 10‑4‑104
Competency of minor to contract for insurance - nonavoidance 10‑4‑105
Valuation of bonds and policies other than life 10‑4‑106
Assigned risks 10‑4‑106.5
Medical malpractice insurers - requirement to provide information to the department of public health and environment 10‑4‑107
Cancellation of medical malpractice policies 10‑4‑108
Notice 10‑4‑109
Nonrenewal of medical malpractice policies 10‑4‑109.5
Notice of intent prior to unilateral increase in premium or decrease in coverage previously provided in medical malpractice policies 10‑4‑109.6
Medical malpractice insurers - protections relating to reproductive health care - definition 10‑4‑109.7
Notice of intent prior to cancellation of certain policies of insurance 10‑4‑110
Notice of intent prior to nonrenewal of certain policies of insurance 10‑4‑110.3
Exclusions where claim involves sexual misconduct - void 10‑4‑110.4
Exclusion - claims involving loss in progress not known to insured 10‑4‑110.5
Notice of intent prior to unilateral increase in premium or decrease in coverage previously provided in certain policies of insurance 10‑4‑110.6
Homeowner’s insurance - definition 10‑4‑110.7
Cancellation or nonrenewal - homeowner’s insurance policies 10‑4‑110.8
Homeowner’s insurance - prohibited and required practices - estimates of replacement value - additional living expense coverage - copies of policies - personal property contents coverage - inventory of personal property - requirements concerning total loss scenarios resulting from wildlife disasters - definitions - rules 10‑4‑110.9
Fire insurance - issuance and renewal of policies within federally designated disaster areas 10‑4‑111
Summary disclosure forms required 10‑4‑112
Property damage - time of payment 10‑4‑113
Exemptions 10‑4‑114
Requirements on hazard insurance coverage for loans secured by real property 10‑4‑115
Private utilization review 10‑4‑116
Use of credit information 10‑4‑117
Loss history information report - notice to insured - definition 10‑4‑118
Severability 10‑4‑119
Monthly and electronic payment of premiums 10‑4‑120
Unfair or discriminatory trade practices - legislative declaration 10‑4‑121
Authority of insurer to protect policyholders’ property - emergency 10‑4‑301
Bond executed by surety company 10‑4‑302
Release of surety - other security 10‑4‑303
Application for release of surety - refund 10‑4‑304
Place of deposit 10‑4‑305
Bond part of expense 10‑4‑401
Purpose - applicability 10‑4‑402
Definitions 10‑4‑403
Standards for rates - competition - procedure - requirement for independent actuarial opinions regarding 1991 legislation 10‑4‑404
Rate administration 10‑4‑404.5
Rating plans - property and casualty type II insurers - rules 10‑4‑405
Filing of rating information - certain coverages 10‑4‑406
Review of filings - certain coverages 10‑4‑407
Hearings 10‑4‑408
Rating organization - study of workers’ compensation rates - premium reductions - adoption of rules 10‑4‑409
Rates furnished - cooperation among organizations 10‑4‑410
Advisory organizations 10‑4‑411
Joint underwriting 10‑4‑412
Assigned risk motor vehicle insurance 10‑4‑413
Records required to be maintained 10‑4‑414
Examinations 10‑4‑415
Prohibition against anticompetitive behavior 10‑4‑416
Prohibiting changes in rates or coverages 10‑4‑417
False or misleading information 10‑4‑418
Enforcement procedures - penalties 10‑4‑419
Claims-made policy forms 10‑4‑419.5
Workers’ compensation form certification 10‑4‑420
Risk management procedures 10‑4‑421
Notice of rate increases and decreases 10‑4‑501
Short title 10‑4‑502
Legislative declaration 10‑4‑503
Definitions 10‑4‑504
Scope 10‑4‑505
Construction 10‑4‑506
Colorado insurance guaranty association 10‑4‑507
Board of directors 10‑4‑508
Powers and duties of association 10‑4‑508.5
Aggregate liability of association 10‑4‑509
Plan of operation 10‑4‑510
Duties and powers of commissioner 10‑4‑511
Effect of paid claims 10‑4‑512
Nonduplication of recovery 10‑4‑513
Prevention of insolvencies 10‑4‑514
Examination of association 10‑4‑515
Tax exemption 10‑4‑516
Recognition of assessments in rates 10‑4‑517
Immunity 10‑4‑518
Stay of proceedings 10‑4‑519
Termination - distribution of funds 10‑4‑520
Advertising 10‑4‑601
Definitions 10‑4‑601.5
Administrative authority 10‑4‑602
Basis for cancellation 10‑4‑603
Notice 10‑4‑604
Nonrenewal 10‑4‑604.5
Issuance or renewal of insurance policies - proof of insurance provided by certificate, card, or other media 10‑4‑605
Proof of notice 10‑4‑606
Further notice 10‑4‑607
Immunity 10‑4‑608
Exemptions 10‑4‑609
Insurance protection against uninsured motorists - applicability 10‑4‑610
Property damage protection against uninsured motorists 10‑4‑611
Elimination of discounts - damage by uninsured motorist 10‑4‑613
Glass repair and replacement 10‑4‑614
Inflatable restraint systems - replacement - verification of claims - definition 10‑4‑615
Motorist insurance identification database program - reporting required - fine 10‑4‑616
Disclosure of credit reports 10‑4‑617
Insurers - biannual fee - auto theft prevention authority 10‑4‑619
Coverage compulsory 10‑4‑620
Required coverage 10‑4‑621
Required coverages are minimum 10‑4‑622
Required provision for intrastate and interstate operation 10‑4‑623
Conditions and exclusions 10‑4‑624
Self-insurers 10‑4‑625
Premium payments 10‑4‑626
Prohibited reasons for nonrenewal or refusal to write policy of automobile insurance applicable to this part 6 10‑4‑627
Discriminatory standards - premiums - surcharges - proof of financial responsibility requirements 10‑4‑628
Refusal to write - changes in - cancellation - nonrenewal of policies prohibited 10‑4‑629
Cancellation - renewal - reclassification 10‑4‑630
Exclusion of named driver 10‑4‑632
Reduction in rates for drivers aged fifty-five years or older who complete driver’s education course - legislative declaration 10‑4‑633
Certification of policy and notice forms 10‑4‑633.5
Automobile insurance policies - plain language required - rules 10‑4‑634
Assignment of payment for covered benefits 10‑4‑635
Medical payments coverage - exceptions - definitions 10‑4‑636
Disclosure requirements for automobile insurance products offered - rules 10‑4‑637
No discrimination by profession 10‑4‑638
Retroactive adjustment of health-care service claims 10‑4‑639
Claims practices for property damage 10‑4‑640
Operator’s policy of insurance 10‑4‑641
Rules - medical payments coverage 10‑4‑642
Prompt payment of direct benefits - legislative declaration - definitions 10‑4‑643
Electronic claim forms - rules 10‑4‑1001
Short title 10‑4‑1002
Definitions 10‑4‑1003
Disclosure of information 10‑4‑1004
Evidence - confidential 10‑4‑1005
Immunity 10‑4‑1006
Enforcement 10‑4‑1007
Penalty 10‑4‑1008
Municipal ordinances - concurrent jurisdiction - common law 10‑4‑1009
Continuing duties of insurers - unfair claim settlement practices 10‑4‑1201
Definitions 10‑4‑1202
Minimum standards 10‑4‑1203
Disclosure 10‑4‑1204
Penalties 10‑4‑1205
Applicability 10‑4‑1206
Effective date 10‑4‑1301
Legislative declaration 10‑4‑1302
Definitions 10‑4‑1303
Temporary joint underwriting association 10‑4‑1304
Board of directors - authority 10‑4‑1305
Plan of operation - annual certification 10‑4‑1306
Deficits - assessment - rebate of surplus 10‑4‑1307
Annual statements 10‑4‑1308
Examinations 10‑4‑1309
Legislative declaration - authority of commissioner - emergency rules - judicial review 10‑4‑1310
Privileged communications 10‑4‑1311
Tax exemption 10‑4‑1401
Legislative declaration 10‑4‑1402
Rules 10‑4‑1403
Exemption from rate filing, approval, and form certification requirements 10‑4‑1404
Multistate insurance risks - choice of law 10‑4‑1501
Definitions 10‑4‑1502
Licensure of vendors 10‑4‑1503
Requirements for sale of portable electronics insurance 10‑4‑1504
Authority of vendors of portable electronics 10‑4‑1505
Suspension or revocation of license 10‑4‑1506
Termination of portable electronics insurance 10‑4‑1507
Application for license - fees 10‑4‑1601
Definitions 10‑4‑1602
Exemptions 10‑4‑1603
Requirements for sale of consumer goods service contracts - definitions 10‑4‑1604
Obligations of reimbursement insurance companies 10‑4‑1605
Required disclosures - reimbursement insurance policy 10‑4‑1606
Required disclosures - service contracts 10‑4‑1607
Prohibited acts 10‑4‑1608
Required record keeping 10‑4‑1609
Enforcement provisions - rules 10‑4‑1701
Definitions 10‑4‑1702
Authority to issue license 10‑4‑1703
License - application - restrictions 10‑4‑1704
Disclosures to occupant 10‑4‑1705
Supervision of issuance - training 10‑4‑1706
Compensation 10‑4‑1707
Exemption from requirements 10‑4‑1708
Notification 10‑4‑1709
Enforcement 10‑4‑1801
Short title 10‑4‑1802
Legislative declaration 10‑4‑1803
Definitions 10‑4‑1804
Fair access to insurance requirements plan association - creation - participation required 10‑4‑1805
Fair access to insurance requirements plan association - board of directors - membership - duties 10‑4‑1806
FAIR plan - plan requirements - insurer requirements 10‑4‑1807
Plan of operation - mandatory components - amendments - revocation by commissioner - rules 10‑4‑1808
FAIR plans - requirements for licensed producers 10‑4‑1809
Assessment of fees 10‑4‑1810
Enforcement - suspension or revocation of certificate of authority - fines 10‑4‑1811
Appeals - judicial review 10‑4‑1812
Rules
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Current through Fall 2024

§ 10-4-1603’s source at colorado​.gov