Texas Administrative Code
Title 16 - ECONOMIC REGULATION
Part 4 - TEXAS DEPARTMENT OF LICENSING AND REGULATION
Chapter 77 - SERVICE CONTRACT PROVIDERS AND ADMINISTRATORS
Section 77.70 - Responsibilities of Providers and Administrators

Universal Citation: 16 TX Admin Code § 77.70

Current through Reg. 50, No. 13; March 28, 2025

(a) The provider must clearly and conspicuously identify itself on all written service contracts and, on all written advertising materials that are used by the provider, its administrator(s), or its seller(s).

(b) The provider and/or any administrator appointed by the provider must provide service contract holders with a notification that meets all of the following requirements.

(1) The notification must provide the name, mailing address, and telephone number of the department.

(2) The notification must contain a statement that unresolved complaints concerning providers and administrators or questions concerning the regulation of service contract providers and administrators may be addressed to the department.

(3) The notification must be included on all written service contacts. The notification may be stamped on the contract or printed on a separate sheet and stapled to the contract.

(c) The provider and/or any administrator appointed by the provider must provide service contract holders with the provider's complaint resolution procedures.

(d) The provider and/or any administrator appointed by the provider must disclose the following information to service contract holders:

(1) the specific contract provisions and required disclosures in accordance with Texas Occupations Code §§ 1304.156 and 1304.157;

(2) the procedures and timeframes for a service contract holder to cancel a service contract in accordance with Texas Occupations Code § 1304.1581;

(3) the procedures and timeframes for a provider to refund the purchase price of the service contract and pay any applicable penalty to the service contract holder in accordance with Texas Occupations Code § 1304.1581; and

(4) the conditions in which the provider may cancel a service contract and issue a refund in accordance with Texas Occupations Code § 1304.159.

(e) As part of the disclosures required under subsection (d), a provider and/or any administrator appointed by the provider who sells or issues service contracts described under Texas Occupations Code § 1304.003(a)(2)(B) (referred herein as "identity recovery service contracts") must disclose the following information:

(1) the person or persons who are covered under the identity recovery service contract;

(2) the price of the identity recovery service contract separate from the purchase price of the automobile and any other products or services that are financed with the vehicle;

(3) the term of the identity recovery service contract; and

(4) any conditions that may change the stated term of the identity recovery service contract, including if the identity recovery service contract holder:
(A) pays off the automobile early;

(B) makes late payments or defaults on the payments on the automobile;

(C) refinances the automobile; or

(D) sells or transfers title to the automobile.

(f) As part of the disclosures required under subsection (d), a provider and/or any administrator appointed by the provider who sells or issues service contracts described under Texas Occupations Code § 1304.003(a)(2)(C) (referred herein as "depreciation benefit service contracts") must disclose the following information:

(1) the names and locations of the participating dealers who are part of the depreciation benefit optional member program;

(2) the amount of the credit that will be paid or the method of calculation that will be used to pay the credit toward the purchase of a replacement vehicle;

(3) a statement that purchase of the service contract is not required as a condition of approval of a loan for the purchase of a vehicle;

(4) a statement that a service contract may not be offered by a dealer who requires a loan for the purchase of a vehicle to be financed exclusively with the dealer; and

(5) a statement that the service contract may be cancelled by the service contract holder and the procedures and timeframes for a service contract holder to cancel the service contract and obtain a refund as specified under subsections (d)(2) and (d)(3).

(g) If not provided by the seller at the time of sale, the provider and/or any administrator appointed by the provider must provide a copy of the service contract to the service contract holder within a reasonable amount of time after the date of purchase that still allows the service contract holder the opportunity to cancel the contract and receive a full refund.

(h) If not provided by the seller at the time of sale, the provider and/or any administrator appointed by the provider must provide a receipt for or other written evidence of the purchase of a service contract to the service contract holder within a reasonable amount of time after the date of purchase that still allows the service contract holder the opportunity to cancel the contract and receive a full refund.

(i) A provider shall report to the department within 30 days any change in information required by §77.20 and §77.21.

(j) An administrator shall report to the department within 30 days any change in information required by §77.22 and §77.23.

(k) Upon notification by the department, the provider and/or any administrator appointed by the provider shall allow the department to audit records required to be maintained by Texas Occupations Code Chapter 1304. These records include copies of the service contracts marketed, sold, administered or issued in this state.

Disclaimer: These regulations may not be the most recent version. Texas may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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