HB2403 Summary

• Amends Arizona Revised Statutes § 20-1095.06 regarding service contract disclosures and requirements for service companies holding service company permits.

• Modifies cancellation refund provisions to cap administrative expenses at the lesser of $75 or 10% of the service contract purchase price, with a requirement that administrative expenses cannot exceed the refund amount owed to the holder.

• Adds disclosure requirement that service contracts must clearly state whether preexisting conditions are covered or excluded, prohibiting exclusions for conditions known or reasonably known to the service company or its representatives.

• Changes references from "automobiles" to "motor vehicles" in provisions requiring disclosure of whether nonoriginal manufacturer parts are permitted.

• Clarifies that service contracts are backed either by mechanical reimbursement insurance or the full faith and credit of the obligor, with updated statement language required in contracts.