Full Text of SB0129 94th General Assembly
SB0129eng 94TH GENERAL ASSEMBLY
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| AN ACT concerning service contracts.
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| Be it enacted by the People of the State of Illinois,
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| represented in the General Assembly:
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| Section 5. The Service Contract Act is amended by changing | 5 |
| Sections 5 and 10 and by adding Section 37 as follows:
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| (215 ILCS 152/5)
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| Sec. 5. Definitions.
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| "Department" means the Department of Insurance.
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| "Director" means the Director of Insurance.
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| "Service Contract" means a contract or agreement whereby a | 11 |
| service
contract provider
undertakes for a specified period of | 12 |
| time, for separate and identifiable
consideration, to
perform | 13 |
| the repair, replacement, or maintenance, or indemnification | 14 |
| for such
services, of
any automobile, system, or consumer | 15 |
| product in connection with the operational
or
structural | 16 |
| failure due to a defect in materials or workmanship, or normal | 17 |
| wear
and tear,
with or without additional provision for | 18 |
| incidental payment or indemnity under
limited
circumstances, | 19 |
| for related expenses, including, but not limited to, towing,
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| rental, and
emergency road service. Service contracts may | 21 |
| provide for the repair,
replacement, or
maintenance of such | 22 |
| property for damage resulting from power surges and
accidental
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| damage from handling. Except as provided in Section 37, service
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| Service contracts shall not include contracts of limited
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| duration
that provide for scheduled maintenance only.
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| "Service contract holder" means the person who purchases a | 27 |
| service
contract or a
permitted transferee.
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| "Service contract provider" means a person who is | 29 |
| contractually
obligated to the
service contract holder under | 30 |
| the terms of the service contract. A service
contract
provider | 31 |
| does not include an insurer.
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| "Service contract reimbursement insurance policy" means a |
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| policy of
insurance that
is issued to the service contract | 2 |
| provider to provide reimbursement to the
service
contract | 3 |
| provider or to pay on behalf of the service contract provider | 4 |
| all
covered
contractual obligations incurred by the service | 5 |
| contract provider under the
terms and
conditions of the insured | 6 |
| service contracts issued or sold by the service
contract
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| provider.
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| "System" means the heating, cooling, plumbing, electrical, | 9 |
| ventilation,
or any other similar
system of a home.
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| (Source: P.A. 90-711, eff. 8-7-98.)
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| (215 ILCS 152/10)
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| Sec. 10. Exemptions. Service contract providers and | 13 |
| related service
contract sellers and administrators complying | 14 |
| with this Act are not required
to comply with and are not | 15 |
| subject to any provision of the Illinois Insurance
Code. A | 16 |
| service contract provider who is the manufacturer or a | 17 |
| wholly-owned
subsidiary of the manufacturer of the product or | 18 |
| the builder, seller, or
lessor of the product that is the
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| subject of the service contract is required to comply only with | 20 |
| Sections 30,
35, 37, 45, and 50 of this Act; except that, a | 21 |
| service contract provider who sells
a motor vehicle, excluding | 22 |
| a motorcycle as defined in Section 1-147 of the
Illinois | 23 |
| Vehicle Code, or who leases, but is not the manufacturer of, | 24 |
| the motor
vehicle, excluding a motorcycle as defined in Section | 25 |
| 1-147 of the Illinois
Vehicle Code, that is the subject of the | 26 |
| service contract must comply with this
Act in its entirety. | 27 |
| Contracts for the repair and monitoring of private alarm
or | 28 |
| private security systems regulated under the Private | 29 |
| Detective, Private
Alarm, Private Security, and Locksmith Act | 30 |
| of 2004 are not
required to comply
with this Act and are not | 31 |
| subject to any provision of the Illinois Insurance
Code.
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| (Source: P.A. 92-16, eff. 6-28-01; 93-438, eff. 8-5-03.)
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| (215 ILCS 152/37 new) | 34 |
| Sec. 37. Performance of automobile service contract |
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| services. If the service contract is for an automobile and | 2 |
| provides that a specified number of individual services are to | 3 |
| be provided to the service contract holder during the duration | 4 |
| of the service contract, the service contract provider must | 5 |
| provide the number of individual services specified under the | 6 |
| service contract even if the contract has expired. | 7 |
| For the purposes of this Section, "service contract holder" | 8 |
| means only the purchaser of the service contract.
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| Section 99. Effective date. This Act takes effect upon | 10 |
| becoming law.
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