FILED ON: 12/9/2013
SENATE . . . . . . . . . . . . . . No. 1952
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The Commonwealth of Massachusetts
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In the Year Two Thousand Thirteen
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An Act relative to motor vehicle service contracts.
Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:
SECTION 1. Section 149M of Chapter 175 of the General Laws is hereby amended by striking the definition of “Consumer” and inserting in place thereof the following definition:
“Consumer”, an individual who purchases, other than for purposes of resale, tangible property used for personal, family or household purposes.
SECTION 2. Said Section 149M is hereby further amended by inserting after the definition of “Consumer” the following new definitions:
“Maintenance agreement” means a contract of limited duration that provides for scheduled maintenance only and does not include repair or replacement.
“Motor Vehicle Manufacturer” means a person that: (a) manufactures or produces motor vehicles under its own name or label; (b) is a subsidiary of the person who manufactures or produces motor vehicles; (c) is a corporation which owns 100 percent of the person who manufactures or produces motor vehicles; or (d) does not manufacture or produce motor vehicles but, pursuant to a written contract, licenses the use of its trade name or label to another person who manufactures or produces motor vehicles.
SECTION 3. Said Section 149M is hereby further amended by striking the definition of “Service contract” and inserting in place thereof the following definition:
“Service contract”, a contract for a separately stated consideration and for a specific duration to perform the service, repair, replacement or maintenance of tangible property, including a motor vehicle, or indemnification for service, repair, replacement or maintenance, for the operational or structural failure due to a defect in materials or workmanship or normal wear and tear, with or without additional provision for incidental payment or indemnity under limited circumstances, for related expenses, including, but not limited to, rental and food spoilage. Service contract also includes a contract or agreement sold for a separately stated consideration for a specific duration that provides for any of the following: (a) 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; (b) the removal of dents, dings, or creases on a motor vehicle that can be repaired using the process of paintless dent removal without affecting the existing paint finish and without replacing vehicle body panels, sanding, bonding, or painting; (c) the repair of small motor vehicle windshield chips or cracks which may include the replacement of the windshield for chips or cracks that cannot be repaired; or (d) 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.
SECTION 4. Section 149N of Chapter 75 of the General Laws is hereby amended by striking paragraph (j) and inserting in place thereof the following:
(j) Service contracts may provide for the service, repair, replacement or maintenance of tangible property for damage resulting from power surges and accidental damage from handling and may provide for leak or repair coverage to roofing systems on residential dwellings.
SECTION 5. Section 149V of Chapter 75 of the General Laws is hereby amended by striking said section and inserting in place thereof the following:
Section 149V. The following shall be exempt from sections 149M to 149W, inclusive: (a) warranties, service contracts or maintenance agreements provided by public utilities that are regulated by the department of telecommunications and cable or the Federal Communications Commission, or by an affiliate of such entity, covering customer wiring, transmission devices serviced by such public utility or warranting services provided by such public utility or its affiliate; (b) mechanical breakdown insurance policies offered by insurers otherwise licensed and regulated under the insurance laws and regulations of the commonwealth; (c) warranties, service contracts or other agreements regarding automobiles under which a licensed motor vehicle dealer is obligated to perform; (d) warranties offered by builders as part of a conveyance of real estate. Motor vehicle manufacturer’s service contracts on the motor vehicle manufacturer’s products need only comply with sections 149N(g), 149P, 149Q, and 149U, as applicable, of this Act, and motor vehicle manufacturers offering service contracts on the motor vehicle manufacturer's products are exempt from licensure under section 149N(c); (e) warranties on a product made by the manufacturer, importer, or seller of the product; and (f) maintenance agreements.