Contract News

SCC'S Bureau Of Insurance Advises Consumers Regarding Home Service Contracts

RICHMOND -- Effective July 1, 2006, the State Corporation Commission’s (SCC) Bureau of Insurance will have the authority to license entities as home service contract providers.

A new law adopted by the 2006 General Assembly (House Bill 383) established a regulatory framework for providers of home service contracts which includes licensure. These providers will be able to issue home service contracts that are similar to home protection insurance contracts, which are currently regulated by the SCC.

Both types of contracts are designed to offer consumers some financial protection against certain unforeseen home and appliance repairs and maintenance expenses that may not be covered under standard homeowners insurance policies. These may include failure of a home appliance or major system (such as electrical, plumbing, heating or air conditioning) due to normal wear and tear or mechanical breakdown. In the case of home protection insurance contracts, coverage may also include structural components of a residential dwelling such as roof, foundation, basement, walls, ceiling, or floors.

The SCC’s Bureau of Insurance advises consumers that there are important differences between home protection insurance contracts currently regulated by the Bureau, and home service contracts that become regulated on July 1. Although some features appear to be similar, home service contracts are not insurance.

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	Did You Know?
	A Contractual Offer Can Be Revoked At Anytime Before Its Accepted A person making a contractual offer may cancel it completely at any time before it is accepted. Though, If you wish to revoke your offer, you must communicate that fact to the person(s) who might be accepting your offer.