TITLE XXXVII
INSURANCE

CHAPTER 415-C
CONSUMER GUARANTY CONTRACTS

Section 415-C:1

    415-C:1 Definitions. –
In this chapter:
I. "Commissioner" means the insurance commissioner.
II. "Consumer" means a natural person who, for personal or family use and not for commercial or research purposes:
(a) Buys or sells residential real property, or
(b) Buys other than for purposes of resale any tangible personal property that is distributed in commerce and that is normally used for personal, family, or household purposes.
III. "Consumer guaranty contract":
(a) Is an agreement in which one party, for consideration, promises to pay, indemnify, provide a specified or determinable amount or benefit, or to do some act of value for another party, based upon a determinable risk contingency or peril, but which is not insurance or does not warrant full application of the state's insurance statutes or rules.
(b) Includes the following agreements:
(1) Service contracts, also known as extended warranties or warranty service contracts, that apply to motor vehicles, homes, and consumer products.
(2) Prepaid legal contracts.
(3) [Repealed.]
(4) Contracts deemed by the commissioner by rule or order subject to this chapter.
(c) Does not include any of the following:
(1) Expressed or implied warranties.
(2) Maintenance agreements.
(3) Motor vehicle road service, tourist service and repairs under RSA 407-C.
(4) Warranties, service contracts, or maintenance agreements offered by public utilities on their transmission devices regulated by the public utilities commission.
(5) Warranties, service contracts, and maintenance agreements that are conditioned upon or otherwise associated with the sale or supply of heating fuel.
(6) Warranties, service contracts, and maintenance agreements sold or offered for sale to persons other than consumers. This provision does not apply to prepaid legal contracts, which may be offered to any governmental corporation, unit, agency, or department, or to any employer or association of employers, a labor union or other similar employee organization, including the trustees of a fund established by such labor union or employee organization. The term "employee" and " employees" shall have the same meaning as are given to such terms for the purpose of writing group life insurance in this state.
(7) Debt cancellation or debt suspension contracts between a creditor and a borrower for the cancellation or suspension of the debt.
IV. "Contract fee" means the total purchase price or consideration paid for a consumer guaranty contract.
V. "Contract holder" means a person who buys a consumer guaranty contract or permitted transferee.
VI. "Maintenance agreement" means a contract of limited duration that provides for scheduled maintenance only.
VII. "Manufacturer" means a person who:
(a) Manufactures or produces the property and sells the property under the person's own name or label;
(b) Is a wholly owned subsidiary of the person who manufactures or produces the property;
(c) Is a corporation which owns 100 percent of the person who manufactures or produces the property;
(d) Manufactures or produces the property and the property is sold under the trade name or label of another person;
(e) Does not manufacture or produce the property but, by written contract, licenses the use of the person's trade name or label to another person that sells the property under the licensor's trade name or label; or
(f) For personal property, does not manufacture or produce the property, but the property is sold under the person's trade name label.
VIII. "Obligor" means a person who is legally obligated to a contract holder under the terms of the consumer guaranty contract. Obligor shall not include service suppliers acting for a registered obligor.
IX. "Person" means an individual, partnership, corporation, incorporated or unincorporated association, joint stock company, reciprocal, syndicate, or any similar entity or combination of entities acting in concert.
X. "Premium" means the consideration paid to an insurer for a reimbursement insurance policy.
XI. "Prepaid legal services" contract:
(a) Is an agreement that assumes a contractual obligation to reimburse the beneficiary against or pay on behalf of the beneficiary, or to provide specified legal services or reimbursement for all or a portion of legal fees, costs, and expenses related to or arising out of services provided by or under the supervision of an individual licensed or admitted to practice law in the state of New Hampshire, in which the services are to be rendered, in consideration of a specified payment for an interval of time, regardless of whether the payment is made by the beneficiaries individually or by a third person for them, in such a manner that the total cost incurred by assuming the obligation is to be spread directly or indirectly among a group of persons.
(b) Shall not include the provision of or reimbursement for legal services incidental to insurance coverages. The following are not considered prepaid legal services contracts:
(1) Retainer contracts made with individual clients with the fees based on estimates of the nature and amount of services that will be provided to the specific client, and similar contracts made with a group of clients involved in the same or closely related legal matters, such as class actions.
(2) Plans providing no benefits other than a limited amount of consultation and advice on simple matters either alone or in combination with referral services or on the promise of fee discounts for other matters.
(3) Plans providing limited benefits on simple legal matters on an informal basis, not involving a legally binding promise, in the context of an employment, educational, or similar relationship.
(4) Contracts that provide benefits under automobile club membership contracts and automobile liability insurance policies with limited legal services or reimbursement for legal services in automobile-related matters under the certificates of authority issued by the commissioner.
(5) Legal services or other legal services programs for the indigent.
(6) Legal services provided by unions or employee associations to their members in matters relating to employment or occupation.
(7) Legal services provided by an agency of the federal or state government or subdivision thereof to its employees or that are otherwise excluded from the provisions of this chapter by the Federal Retirement Income Security Act of 1974, or any amendments thereto.
XII. "Reimbursement insurance policy" means a policy of insurance issued to an obligor and by which an insurer agrees to either provide reimbursement to the obligor under the terms of the insured consumer guaranty contracts issued or sold by the obligor or, in the event of the obligor's non-performance, to pay on behalf of the obligor all covered contractual obligations incurred by the obligor under the terms of the insured consumer guaranty contracts issued or sold by the obligor.
XIII. "Sales representative" means any person who is not an obligor, who sells, solicits, negotiates, or issues consumer guaranty contracts on behalf of an obligor.
XIV. (a) "Service contract" means a contract or agreement for a separately stated consideration, and a specified period of time or usage, covering any consumer good, including, but not limited to, any automobile, household system, or appliance, which promises to provide for the service, repair, replacement, or maintenance of the property necessitated by operational or structural failure due to: a defect in materials or workmanship; normal wear and tear; power surges; or accidental damage from handling. This definition shall apply regardless of the name or label of such contract and regardless of the nature of the service contract obligor. A service contract may provide for the payment of incidental indemnity when service repair or replacement is not feasible or economical or under limited circumstances, including, but not limited to, towing, rental, road hazard, emergency road service, lodging, meals, food loss, or other minor expenses that directly relate to the failure of the consumer good.
(b) "Service contract" includes a contract or agreement for a separately stated consideration, and a specified period of time or usage that provides for any of the following:
(1) Repair or replacement of tires and/or wheels on an automobile 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;
(2) Removal of dents, dings, or creases on an automobile that can be repaired using the process of paintless dent removal without affecting the existing paint finish and without replacing automobile body panels, sanding, bonding, or painting;
(3) Repair of chips or cracks in or the replacement of an automobile windshield as a result of damage caused by road hazards; or
(4) Replacement of an automobile key or key-fob if the key or key-fob becomes inoperable or is lost or stolen.
XV. "Service contract holder" means a person who is the purchaser or holder of a service contract.
XVI. "Service supplier" means a person, not employed by the obligor, who is owned by the obligor or contractually obligated to provide on behalf of the obligor services or obligations specified in the consumer guaranty contract to be provided to a contract holder.
XVII. "Warranty" means a warranty made solely by the manufacturer, importer, or seller of property or services without charge, that is not negotiated or separated from the sale of the product and is incidental to the sale of the product, that guarantees indemnity for defective parts, mechanical or electrical breakdown, labor or other remedial measures, such as repair or replacement of the property or repetition of services.

Source. 2004, 224:1. 2015, 207:1, 6, 8, eff. Sept. 4, 2015.