1. A licensed service company which offers motor vehicle service contracts for sale in this state, or its representative, shall not, directly or indirectly, represent in any manner, whether by written solicitation or telemarketing, a false, deceptive, or misleading statement with respect to any of the following:

 a. Statements regarding the service company‘s affiliation with a motor vehicle manufacturer or importer.
 b. Statements regarding the validity or expiration of a warranty.
 c. Statements regarding a motor vehicle service contract holder’s coverage under a motor vehicle service contract, including statements suggesting that the service contract holder must purchase a new service contract in order to maintain coverage under the existing service contract or warranty.

Terms Used In Iowa Code 523C.13

  • Commissioner: means the commissioner of insurance. See Iowa Code 523C.1
  • Contract: means the same as defined in section 554D. See Iowa Code 554E.1
  • Contract: A legal written agreement that becomes binding when signed.
  • following: when used by way of reference to a chapter or other part of a statute mean the next preceding or next following chapter or other part. See Iowa Code 4.1
  • Licensed service company: means a service company which is licensed by the commissioner pursuant to this chapter. See Iowa Code 523C.1
  • Motor vehicle: means any self-propelled vehicle subject to registration under chapter 321. See Iowa Code 523C.1
  • Motor vehicle manufacturer: means any of the following:
     a. See Iowa Code 523C.1
  • person: means individual, corporation, limited liability company, government or governmental subdivision or agency, business trust, estate, trust, partnership or association, or any other legal entity. See Iowa Code 4.1
  • Sale: means any sale, offer for sale, or attempt to sell or lease any land, to the public in this state, for cash or on credit. See Iowa Code 543C.1
  • Service company: means a person who is contractually obligated to perform services pursuant to a motor vehicle service contract or residential service contract. See Iowa Code 523C.1
  • Service contract: means a motor vehicle service contract or residential service contract. See Iowa Code 523C.1
  • state: when applied to the different parts of the United States, includes the District of Columbia and the territories, and the words "United States" may include the said district and territories. See Iowa Code 4.1
  • Warranty: means a statement made solely by the manufacturer, importer, or seller of property or services without consideration, that is not negotiated or separated from the sale of the product and is incidental to the sale of the product, and that guarantees indemnity for defective parts, mechanical or electrical breakdown, and labor or other remedial measures, such as repair or replacement of the property or repetition of services. See Iowa Code 523C.1
 2. The commissioner may adopt rules which regulate motor vehicle service contracts and residential service contracts to prohibit misrepresentation, false advertising, defamation, boycotts, coercion, intimidation, false statements and entries and unfair discrimination or practices. If the commissioner finds that a person has violated the rules adopted under this section, the commissioner may order any or all of the following:

 a. Payment of a civil penalty of not more than one thousand dollars for each and every act or violation, but not to exceed an aggregate of ten thousand dollars, unless the person knew or reasonably should have known the person was in violation of this section, in which case the penalty shall be not more than five thousand dollars for each and every act or violation, but not to exceed an aggregate penalty of fifty thousand dollars in any one six-month period. The commissioner shall, if it finds the violations of this section were directed, encouraged, condoned, ignored, or ratified by the employer of such person, assess such penalty to the employer and not such person. Any civil penalties collected under this subsection shall be deposited as provided in section 505.7.
 b. Suspension or revocation of the license of a person, if the person knew or reasonably should have known the person was in violation of this section.
 3. A violation of this chapter constitutes an unlawful practice pursuant to section 714.16.
 4. A service contract issued or sold in this state is void if the person that issued or sold the service contract, at the time of issuance or sale, was not licensed as a service company under this chapter.
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