Terms Used In Louisiana Revised Statutes 32:1277
- Incidental costs: means expenses specified in the warranty incurred by the warranty holder related to the failure of the vehicle protection product to perform as provided in the warranty. See Louisiana Revised Statutes 32:1272
- 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.
- Vehicle protection product: means a vehicle protection device, system, or service that is:
(i) Installed on or applied to a vehicle. See Louisiana Revised Statutes 32:1272
- warrantor: means a person who is contractually obligated to the warranty holder under the terms of the vehicle protection product warranty agreement. See Louisiana Revised Statutes 32:1272
- warranty: means a written agreement by a warrantor that provides if the vehicle protection product fails to prevent loss or damage to a vehicle from a specific cause, that the warrantor will pay to or on behalf of the warranty holder specified incidental costs as a result of the failure of the vehicle protection product to perform pursuant to the terms of the warranty. See Louisiana Revised Statutes 32:1272
- Warranty holder: means a person who purchases a vehicle protection product or who is a permitted transferee. See Louisiana Revised Statutes 32:1272
- Warranty reimbursement insurance policy: means a policy of insurance that is issued to the 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 the insured vehicle protection product warranties issued by the warrantor. See Louisiana Revised Statutes 32:1272
A. A vehicle protection product warranty shall not be sold or offered for sale in this state unless the warranty:
(1) States the following: “The obligations of the warrantor to the warranty holder are guaranteed under a warranty reimbursement insurance policy” if the warrantor elects to meet its financial responsibility obligations under R.S. 32:1275(1), or states “The obligations of the warrantor under this warranty are backed by the full faith and credit of the warrantor” if the warrantor elects to meet its financial responsibility obligations under R.S. 32:1275(2).
(2) States that in the event 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 sixty days after proof of loss has been filed with the warrantor, if the warrantor elects to meet its financial responsibility obligations under R.S. 32:1275(1).
(3) States the name and address of the issuer of the warranty reimbursement insurance policy, and this information need not be preprinted on the warranty form, but may be added to or stamped on the warranty, if the warrantor elects to meet its financial responsibility obligations under R.S. 32:1275(1).
(4) Identifies the warrantor, the seller, and the warranty holder.
(5) Sets forth the total purchase price and the terms under which it is to be paid, however, the purchase price is not required to be preprinted on the vehicle protection product warranty and may be negotiated with the consumer at the time of sale.
(6) Sets forth the procedure for making a claim, including a telephone number.
(7) Specifies the payments or performance to be provided under the warranty including payments for incidental costs, the manner of calculation or determination of payments or performance, and any limitations, exceptions or exclusions.
(8) Sets forth all of the obligations and duties of the warranty holder such as the duty to protect against any further damage to the vehicle, the obligation to notify the warrantor in advance of any repair, or other similar requirements, if any.
(9) Sets forth any terms, restrictions, or conditions governing transferability and cancellation of the warranty, if any.
(10) Contains a disclosure that reads substantially as follows: “This agreement is a product warranty and is not insurance.”
B. Incidental costs may be reimbursed under the provisions of the warranty in either a fixed amount specified in the warranty or sales agreement or by the use of a formula itemizing specific incidental costs incurred by the warranty holder.
Acts 2007, No. 388, §1, eff. Jan. 1, 2008.