Michigan Laws 257.1251 – Requirements
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Terms Used In Michigan Laws 257.1251
- Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
- Incidental costs: means expenses specified in a warranty incurred by a warranty holder and related to the failure of a vehicle protection product to perform as provided in the warranty. See Michigan Laws 257.1243
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Person: means an individual, partnership, corporation, limited liability company, association, or other legal entity. See Michigan Laws 257.1243
- state: when applied to the different parts of the United States, shall be construed to extend to and include the District of Columbia and the several territories belonging to the United States; and the words "United States" shall be construed to include the district and territories. See Michigan Laws 8.3o
- Vehicle protection product: means a vehicle protection device, system, or service that is installed on or applied to a vehicle and is designed to prevent loss or damage to a vehicle from a specific cause. See Michigan Laws 257.1243
- Warranted product: means a vehicle protection product covered by a written warranty. See Michigan Laws 257.1243
- warrantor: means a person that is contractually obligated to a warranty holder under the terms of a vehicle protection product warranty agreement. See Michigan Laws 257.1243
- warranty: means a written agreement by a warrantor that provides if a warranted product fails to prevent loss or damage to a vehicle from a specific cause covered by the warranty, the warrantor shall pay the warranty holder specified incidental costs that result from the failure of the warranted product to perform. See Michigan Laws 257.1243
- Warranty holder: means a person who purchases a warranted product or who is a permitted transferee. See Michigan Laws 257.1243
- Warranty reimbursement insurance policy: means a policy of insurance that is issued to a vehicle protection product warrantor to provide reimbursement to the warrantor or to pay on behalf of the warrantor all covered contractual obligations incurred by the warrantor under the terms and conditions of an insured vehicle protection product warranty sold by a warrantor. See Michigan Laws 257.1243
(1) A person shall not sell or offer for sale in this state a warranted product unless the warranty on the vehicle protection product meets all of the following requirements:
(a) Is written in clear, understandable language and is printed or typed in easy-to-read type, size, and style.
(b) Conspicuously states that the obligations of the warrantor to the warranty holder are guaranteed under a warranty reimbursement insurance policy.
(c) Conspicuously states that if a warranty holder must make a claim against a party other than the warranty reimbursement insurance policy issuer, the warranty holder is entitled to make a direct claim against the insurer upon the failure of the warrantor to pay any claim or meet any obligation under the terms of the warranty within 60 days after proof of loss has been filed with the warrantor.
(d) Conspicuously states the name and address of the issuer of the warranty reimbursement insurance policy.
(e) Identifies the warrantor, the seller, and the warranty holder.
(f) Contains the total purchase price for the warranty. However, the parties may negotiate the purchase price at the time of sale and it is not required that the purchase price be preprinted on the warranty.
(g) Describes the procedure for making a claim, including a telephone number.
(h) Conspicuously states the existence of any deductible amount.
(i) Specifies the payments or performance provided under the warranty, including, but not limited to, any payments for incidental costs, the manner of calculation or determination of payments or performance, and any limitations, exceptions, or exclusions.
(j) Describes the conditions under which substitution of parties or performance is allowed.
(k) Conspicuously sets forth all of the obligations and duties of the warranty holder, including, but not limited to, any duty to protect against any further damage to the vehicle, the obligation to notify the warrantor in advance of any repair, or any other similar requirements.
(l) Sets forth any terms, restrictions, or conditions governing any right to transfer the warranty.
(m) Contains a disclosure that reads substantially as follows: “This agreement is a product warranty and is not insurance.”.
(2) At the time of sale, the seller or warrantor shall provide 1 of the following to the purchaser:
(a) A copy of the vehicle protection product warranty.
(b) A receipt or other written evidence of the purchase of the warranted product. A warrantor or seller that provides a receipt or other evidence under this subdivision shall provide the purchaser with a copy of the warranty within 30 days after the date of purchase.