Guam § 12202 - Definitions.

§ 12202. Definitions.

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(a) Administrator means a person appointed or designated by a provider

who administers service contracts and service contract plans on behalf of the

provider, and subject to the requirements of this Article.

(b) Commissioner means the Insurance and Banking Commissioner.

(c) Consumer means an individual who buys any tangible personal

goods that is primarily for personal, family, or household use.

(d) Non-original manufacturer’s parts means replacement parts not

made for or by the original manufacturer of the goods, commonly referred to

as “after-market parts.”

(e) Person means an individual, limited liability partnership,

partnership, limited liability company, corporation, incorporated or

unincorporated association, joint stock company, reciprocal, syndicate, or

any similar entity or combination of entities acting in concert.

(f) Reimbursement insurance policy means a policy of insurance issued

to a service contract provider by an authorized insurer. Pursuant to this

insurance policy, the insurer agrees, for the benefit of the service contract

holders, to discharge all of the obligations and liabilities of the service

contract provider under the terms of the issued service contracts or in the

event of non-performance by the insured service contract provider. A

reimbursement insurance policy insurer shall not terminate the policy until it

has issued a notice of termination required by the Commissioner under the

insurance laws, rules, or regulations of the government of Guam. The

termination of a reimbursement insurance policy shall not reduce the

insurer’s responsibility for service contracts issued by service contract

providers prior to the date or termination. A service contract provider shall

be considered the agent of the reimbursement insurance policy insurer for

purposes of determining duties owed by the insurer to service contract

holders in accordance with the service contract, and this Article. Insurers are

deemed to have received the premiums for the insurance upon the payment

of provider fees by consumers for service contracts issued by the insured

service contract provider. “All obligations and liabilities” include:

(1) the failure or inability of the insured service contract provider

to perform under the terms and conditions of the provider’s issued

service contracts; and

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(2) in the event of cancellation, the service contract provider’s

failure or inability to return the unearned portion of the paid service

contract fee to the service contract holder.

(g) Service contract, for the purposes of this Article, means a contract or

agreement for a separately stated consideration for a specific duration to

perform the repair, replacement or maintenance of goods or indemnification

for repair, replacement or maintenance, for the operational or structural

failure of any motor vehicle or other goods due to a defect in materials,

workmanship, accidental damage from handling, or normal wear and tear,

with or without additional provisions for incidental payment of indemnity

under limited circumstances, including, but not limited to, towing, rental and

emergency road service, and road hazard protection. Motor vehicle

manufacturer and original equipment manufacturer (OEM)-backed contracts

shall be exempt from the requirements in this Article. Service contracts may

provide for repair, replacement, or maintenance of goods for damage

resulting from power surges or interruption. Service contracts also include a

contract or agreement sold for a separately stated consideration for a specific

duration that provides for any of the following:

(1) the repair or replacement or indemnification for the repair or

replacement of a motor vehicle for the operational or structural failure

of one or more parts or systems of the motor vehicle brought about by

the failure of an additive product to perform as represented;

(2) the repair or replacement of tires and/or wheels on a motor

vehicle damaged as a result of coming into contact with road hazards,

including, but not limited to, potholes, rocks, wood debris, metal parts,

glass, plastic, curbs, or composite scraps;

(3) the removal of dents, dings, or creases on a motor vehicle that

can be repaired using the process of paint-less dent removal without

affecting the existing paint finish and without replacing vehicle body

panels, sanding, bonding or painting;

(4) the repair of small motor vehicle windshield chips or cracks,

but which expressly excludes the replacement of the entire windshield;

or

(5) the repair of damage to the interior components of a motor

vehicle caused by wear and tear, but which expressly excludes the

replacement of any part or component of a motor vehicle’s interior.

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(h) Service Contract Provider means a person who is contractually

obligated to the service contract holder under the terms of the service

contract.

(i) Service Contract Holder or contract holder means a person who is

the purchaser or holder of a service contract.

(j) Service Contract Seller means the person who sells the service

contract to the consumer.

(k) Warranty means a warranty made without consideration, solely by

the manufacturer, importer, or seller of goods or services, that is not

negotiated or separated from the sale of the product and is incidental to the

sale of the product, that provides repair or replacement for defective parts,

mechanical or electrical breakdown, labor, or other remedial measures.