AB 2111 Summary

• Expands the definition of "service contract" to include accessories of electronic sets and appliances, while excluding contracts for structural wiring associated with communications services.

• Removes the $250 per year cap on incidental indemnity payments and allows service contract administrators to be obligors if all service contracts are insured under a reimbursement insurance policy.

• Requires third-party obligors who are not the seller, manufacturer, or repairer to obtain service contract reimbursement insurance; failure to do so is deemed unlawful transacting of insurance subject to criminal and monetary penalties.

• Modifies vehicle service contract cancellation provisions to allow obligors to choose the refund method (elapsed time or objective measure of use) for pro rata refunds and adds glass sealant manufacturer warranties to exemptions.

• Extends the operative period of these service contract provisions from January 1, 2013 to January 1, 2018.