The bill amends the Revised Code of Washington (RCW) to enhance consumer protection regarding service contracts and protection product guarantees. It clarifies key definitions such as "administrator," "consumer," "protection product," and "service contract," while introducing new obligations for service contract and protection product guarantee providers. These obligations include requirements for financial responsibility, such as maintaining reimbursement insurance policies, reserve accounts, and financial security deposits. Additionally, the bill mandates that service contracts must allow holders to return the contract within a specified period for a full refund if no claims have been made, and it outlines penalties for delayed refunds.

Moreover, the bill updates financial requirements for protection product guarantee providers, increasing the minimum net worth and establishing a nonrefundable application fee. It specifies that service contract providers cannot deny claims based on the holder's failure to maintain the vehicle unless it directly relates to the part that failed, and it sets a 60-day period for providers to determine vehicle coverage eligibility. The bill also clarifies the relationship between service contract providers and insurers, stating that providers act as agents for each insurer issuing reimbursement insurance policies. Violations of the chapter are classified as unfair or deceptive acts under the consumer protection act, allowing affected holders to pursue legal action against both providers and insurers. Key insertions include the specification of "each" insurer and the addition of "or policies" related to reimbursement insurance.

Statutes affected:
Original Bill: 48.110.020, 48.110.050, 48.110.055, 48.110.060, 48.110.073, 48.110.075, 48.110.110, 48.110.140