94TH GENERAL ASSEMBLY
State of Illinois
2005 and 2006
SB0129


 
Introduced 2/1/2005, by Sen. Christine Radogno
 
SYNOPSIS AS INTRODUCED:
 		
















215 ILCS 152/5




215 ILCS 152/10





215 ILCS 152/37 new










    Amends the Service Contract Act.  Provides that, if the service contract provides that a specified number of individual services are to be provided to the service contract holder during the duration of the service contract,  the service contract provider must provide the number of individual services specified under the service contract even if the contract has expired. Effective immediately.
















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A BILL FOR









 











SB0129

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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 
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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 
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service
contract provider
undertakes for a specified period of 
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time, for separate and identifiable
consideration, to
perform 
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the repair, replacement, or maintenance, or indemnification 
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for such
services, of
any automobile, system, or consumer 
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product in connection with the operational
or
structural 
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failure due to a defect in materials or workmanship, or normal 
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wear
and tear,
with or without additional provision for 
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incidental payment or indemnity under
limited
circumstances, 
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for related expenses, including, but not limited to, towing,

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rental, and
emergency road service.  Service contracts may 
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provide for the repair,
replacement, or
maintenance of such 
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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 
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service
contract or a
permitted transferee.

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    "Service contract provider" means a person who is 
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contractually
obligated to the
service contract holder under 
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the terms of the service contract.  A service
contract
provider 
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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 
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provider to provide reimbursement to the
service
contract 
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provider or to pay on behalf of the service contract provider 
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all
covered
contractual obligations incurred by the service 
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contract provider under the
terms and
conditions of the insured 
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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, 
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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 
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related service
contract sellers and administrators complying 
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with this Act are not required
to comply with and are not 
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subject to any provision of the Illinois Insurance
Code.  A 
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service contract provider who is the manufacturer or a 
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wholly-owned
subsidiary of the manufacturer of the product or 
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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 
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Sections 30,
35, 37, 45, and 50 of this Act; except that, a 
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service contract provider who sells
a motor vehicle, excluding 
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a motorcycle as defined in Section 1-147 of the
Illinois 
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Vehicle Code, or who leases, but is not the manufacturer of, 
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the motor
vehicle, excluding a motorcycle as defined in Section 
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1-147 of the Illinois
Vehicle Code, that is the subject of the 
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service contract must comply with this
Act in its entirety.  
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Contracts for the repair and monitoring of private alarm
or 
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private security systems regulated under the Private 
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Detective, Private
Alarm, Private Security, and Locksmith Act 
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of 2004 are not
required to comply
with this Act and are not 
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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)
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    Sec. 37. Performance of service contract services.  If the 
 


 






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service contract provides that a specified number of individual 
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services are to be provided to the service contract holder 
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during the duration of the service contract,  the service 
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contract provider must provide the number of individual 
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services specified under the service contract even if the 
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contract has expired.
 

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    Section 99. Effective date. This Act takes effect upon 
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becoming law.