Senate Bill 2458

AN ACT TO DEFINE THE TERM "SERVICE CONTRACT"; TO PROVIDE THAT SERVICE CONTRACTS ARE NOT SUBJECT TO TITLE 83, MISSISSIPPI CODE OF 1972, AND TO PROVIDE THAT SERVICE CONTRACTS ARE SUBJECT TO THE MISSISSIPPI CONSUMER PROTECTION ACT; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. (1) The term "service contract," as used in this section, means a contract or agreement for a separately stated consideration for a specific duration to perform the repair, replacement or maintenance of property or to reimburse, in whole or in part, the owner of such property for the repair, replacement or maintenance of property if so operational or structural failure is due to a defect in materials or manufacturing or to normal wear and tear. A service contract may contain a provision for incidental payment under such contract where service, repair or replacement is not feasible or economical.

(2) The marketing, sale, offering for sale, issuance, making, proposing to make and administration of a service contract is exempt from the provisions of Title 83, Mississippi Code of 1972.

(3) Service contracts shall be subject to the provisions of the Mississippi Consumer Protection Act, Section 75-24-1 et seq.

SECTION 2. This act shall take effect and be in force from and after its passage, and shall be applicable to all proceedings pending before the Department of Insurance or the courts of this state on the effective date of this act.