Colorado § 10-4-1606 - Required disclosures - service contracts.

§ 10-4-1606. Required disclosures - service contracts.

(1) Service contracts marketed, sold, offered for sale, issued, made, proposed to be made, or administered in this state must be written, printed, or typed in clear, understandable language that is easy to read.

(2) Service contracts insured under a reimbursement insurance policy must contain a statement in substantially the following form: "Obligations of the provider under this service contract are insured under a service contract reimbursement insurance policy." The service contract must also state the name and address of the reimbursement insurance company and disclose to the consumer that if the service contract provider does not provide a covered service within sixty days after proof of loss by the service contract holder, the contract holder may apply directly to the reimbursement insurance company.

(3) Service contracts not insured under a reimbursement insurance policy must contain a statement in substantially the following form: "Obligations of the provider under this service contract are backed by the full faith and credit of the provider."

(4) (a) Service contracts must identify the following:

(I) The name and address of the provider;

(II) The identity of any administrator, if different from the provider;

(III) The service contract seller; and

(IV) The service contract holder to the extent that the name of the service contract holder has been furnished by the service contract holder.

(b) The identities of the parties in this subsection (4) are not required to be preprinted on the service contract and may be added to the service contract at the time of sale.

(5) Service contracts must state the total purchase price and the terms under which the service contract is sold. The purchase price is not required to be preprinted on the service contract and may be negotiated at the time of sale with the service contract holder.

(6) In addition to the other requirements of this section, a service contract must:

(a) Identify the consumer goods covered by the contract;

(b) State the existence of any deductible amount, if applicable;

(c) Specify the merchandise and services to be provided and any limitations, exceptions, or exclusions;

(d) State whether the use of a nonoriginal manufacturer's part is allowed;

(e) State any restrictions governing the transferability of the service contract, if applicable;

(f) State the terms, restrictions, or conditions governing cancellation of the service contract, either by the provider or the service contract holder, prior to the termination or expiration date of the service contract;

(g) Set forth all of the obligations and duties of the service contract holder, such as the duty to protect against any further damage and any requirement to follow the owner's manual; and

(h) State whether or not the service contract provides for or excludes consequential damages or preexisting conditions, if applicable.

Source: L. 2014: Entire part added, (HB 14-1199), ch. 204, p. 747, § 2, effective January 1, 2015.