Service Contract Providers
A Service Contract Provider provides extended warranties to consumers for a specified period of time and for an additional cost beyond the price of the product.
Notice of Intent to Review Rules
August 24, 2018
The Texas Department of Licensing and Regulation (Department) is reviewing the Service Contract Providers and Administrators program rules (Title 16, Texas Administrative Code, Chapter 77) for re-adoption, revision, or repeal. The Department will determine whether the reasons for adopting or readopting these rules continue to exist by answering the following questions for each rule:
- Is it obsolete?
- Does it reflect current legal and policy considerations?
- Is it in alignment with the current procedures of the Department?
The Department encourages anyone interested in the Service Contract Provides and Administrators program to review the Notice of Intent and current Chapter 77 rules. Comments may be submitted by email to email@example.com. The deadline for comments is September 24, 2018.
Justification for Adoption of Administrative Rules
June 15, 2018
The Texas Commission of Licensing and Regulation adopted amendments to existing rules regarding the Service Contract Providers and Administrators program (16 Texas Administrative Code, Chapter 77, §§77.10, 77.70, and new §77.26).
2017 Legislative Update
The 85th Legislative Session made three changes to the SCP statute.
- Effective September 1, 2017, SCP contracts may offer to replace a motor vehicle key or key-fob if the key or key-fob becomes inoperable or is lost or stolen. See House Bill 2275 for more information.
- In addition, HB 2275 amended the statute to state that a contract provider is not required to deduct the amount of any claims paid from the amount of a refund requested by a contract holder. This change is also effective September 1, 2017.
- Senate Bill 1199 allows a SCP contract to a provide compensation to the buyer of a vehicle on the total constructive loss under a “Depreciation benefit optional member program.” A Depreciation benefit optional member program means a service contract financed under Chapter 348 or 353, Finance Code, that pays to the buyer, as a credit toward the purchase of a replacement vehicle at a participating dealer, an amount less than or equal to the difference between the purchase price and the actual cash value for a total constructive loss. There are some important restrictions however.
- The amended statute will be posted soon.
Military Service Members, Veterans, and Spouses - For more information about obtaining a TDLR license or renewing a TDLR license that expired while serving on active duty, please go to the Military Outreach home page.