Fla. Stat. 634.121
Forms, required procedures, provisions; delivery and definitions
(1)
Before the sale of any service agreement, written notice must be given to the prospective purchaser by the service agreement company or its agent or salesperson that purchase of the service agreement is not required in order to purchase or obtain financing for a motor vehicle.(2)
All motor vehicle service agreements are assignable in a consumer transaction and must contain a statement in conspicuous, boldfaced type, informing the purchaser of the service agreement of her or his right to assign it to a subsequent retail purchaser of the motor vehicle covered by the service agreement and all conditions on such right of transfer. The assignment must occur within a period of time specified in the agreement, which period may not expire earlier than 15 days after the date of the sale or transfer of the motor vehicle. The service agreement company may charge an assignment fee not to exceed $40.(3)(a)
Each service agreement must contain a cancellation provision. Any service agreement is cancelable by the purchaser within 60 days after purchase. The refund must be 100 percent of the gross premium paid, less any claims paid on the agreement. A reasonable administrative fee may be charged not to exceed 5 percent of the gross premium paid by the agreement holder.After the service agreement has been in effect for 60 days, it may not be canceled by the insurer or service agreement company unless:There has been a material misrepresentation or fraud at the time of sale of the service agreement;
The agreement holder has failed to maintain the motor vehicle as prescribed by the manufacturer;
The odometer has been tampered with or disabled and the agreement holder has failed to repair the odometer; or
For nonpayment of premium by the agreement holder, in which case the service agreement company shall provide the agreement holder notice of cancellation by certified mail.
If the service agreement is canceled by the insurer or service agreement company, the return of premium must not be less than 100 percent of the paid unearned pro rata premium, less any claims paid on the agreement. If, after 60 days, the service agreement is canceled by the service agreement holder, lender, finance company, or creditor, the insurer or service agreement company shall return directly to the agreement holder not less than 90 percent of the unearned pro rata premium, less any claims paid on the agreement. Cancellations initiated by lenders, creditors, or finance companies are only valid if authorized by the terms of the service agreement. The service agreement company remains responsible for full refunds to the consumer on canceled service agreements. However, the salesperson and agent are responsible for the refund of the unearned pro rata commission. A service agreement company may effectuate refunds through the issuing salesperson or agent in accordance with paragraphs (c) and (d).
If the service agreement company effectuates refunds through the issuing salesperson or agent, the service agreement company must send the unearned pro rata premium refund due, less any unearned pro rata commission, to the salesperson or agent effectuating the refund. Upon receipt, the salesperson or agent must refund the unearned pro rata premium, including any unearned pro rata commission, and the sales tax refund owed to the service agreement holder.The salesperson, agent, or service agreement company shall maintain a copy of one of the following documents, as applicable, demonstrating that the refund owed pursuant to paragraph (c) has been refunded:A copy of the front and back of the canceled check for the applicable refund amount owed to the service agreement holder;
A copy of the front of the check for the applicable refund amount owed to the service agreement holder and a copy of the statement from the bank account on which the check was drawn showing that the check was cashed;
A copy of the front of the check issued by the service agreement company to the salesperson or agent in the amount of the service agreement company’s portion of the refund owed to the service agreement holder and a copy of the statement from the bank account on which the check was drawn showing that the check was cashed;
A copy of a completed buyer’s order demonstrating that the applicable refund amount owed to the service agreement holder was credited toward the purchase or lease of another vehicle;
Any document received from or sent to a lender, finance company, or creditor demonstrating that a loan or amount financed by the agreement holder was decreased by the amount of the applicable refund amount owed to the service agreement holder; or
Any other evidence approved by the office in a written communication to a person licensed pursuant to this part demonstrating that the applicable refund amount due to the service agreement holder was properly made.
A salesperson or agent effectuating a refund shall maintain a copy of the documentation required by this paragraph and shall provide a copy to the service agreement company within 45 days after a request is made by the department or the office to either the service agreement company or the salesperson.
If the office finds that a salesperson or agent exhibits a pattern or practice of failing to properly effectuate refunds owed or to maintain and remit to the service agreement company the documentation required by paragraph (d), the office shall notify the department of its finding.(3)(a)
Each service agreement must contain a cancellation provision. Any service agreement is cancelable by the purchaser within 60 days after purchase. The refund must be 100 percent of the gross premium paid, less any claims paid on the agreement. A reasonable administrative fee may be charged not to exceed 5 percent of the gross premium paid by the agreement holder.(b)
After the service agreement has been in effect for 60 days, it may not be canceled by the insurer or service agreement company unless:There has been a material misrepresentation or fraud at the time of sale of the service agreement;The agreement holder has failed to maintain the motor vehicle as prescribed by the manufacturer;The odometer has been tampered with or disabled and the agreement holder has failed to repair the odometer; orFor nonpayment of premium by the agreement holder, in which case the service agreement company shall provide the agreement holder notice of cancellation by certified mail.If the service agreement is canceled by the insurer or service agreement company, the return of premium must not be less than 100 percent of the paid unearned pro rata premium, less any claims paid on the agreement. If, after 60 days, the service agreement is canceled by the service agreement holder, lender, finance company, or creditor, the insurer or service agreement company shall return directly to the agreement holder not less than 90 percent of the unearned pro rata premium, less any claims paid on the agreement. Cancellations initiated by lenders, creditors, or finance companies are only valid if authorized by the terms of the service agreement. The service agreement company remains responsible for full refunds to the consumer on canceled service agreements. However, the salesperson and agent are responsible for the refund of the unearned pro rata commission. A service agreement company may effectuate refunds through the issuing salesperson or agent in accordance with paragraphs (c) and (d).
(c)
If the service agreement company effectuates refunds through the issuing salesperson or agent, the service agreement company must send the unearned pro rata premium refund due, less any unearned pro rata commission, to the salesperson or agent effectuating the refund. Upon receipt, the salesperson or agent must refund the unearned pro rata premium, including any unearned pro rata commission, and the sales tax refund owed to the service agreement holder.(d)
The salesperson, agent, or service agreement company shall maintain a copy of one of the following documents, as applicable, demonstrating that the refund owed pursuant to paragraph (c) has been refunded:A copy of the front and back of the canceled check for the applicable refund amount owed to the service agreement holder;A copy of the front of the check for the applicable refund amount owed to the service agreement holder and a copy of the statement from the bank account on which the check was drawn showing that the check was cashed;A copy of the front of the check issued by the service agreement company to the salesperson or agent in the amount of the service agreement company’s portion of the refund owed to the service agreement holder and a copy of the statement from the bank account on which the check was drawn showing that the check was cashed;A copy of a completed buyer’s order demonstrating that the applicable refund amount owed to the service agreement holder was credited toward the purchase or lease of another vehicle;Any document received from or sent to a lender, finance company, or creditor demonstrating that a loan or amount financed by the agreement holder was decreased by the amount of the applicable refund amount owed to the service agreement holder; orAny other evidence approved by the office in a written communication to a person licensed pursuant to this part demonstrating that the applicable refund amount due to the service agreement holder was properly made.A salesperson or agent effectuating a refund shall maintain a copy of the documentation required by this paragraph and shall provide a copy to the service agreement company within 45 days after a request is made by the department or the office to either the service agreement company or the salesperson.
(e)
If the office finds that a salesperson or agent exhibits a pattern or practice of failing to properly effectuate refunds owed or to maintain and remit to the service agreement company the documentation required by paragraph (d), the office shall notify the department of its finding.(4)
If the service agreement is canceled, pursuant to an order of liquidation, the salesperson or agent is responsible for refunding, and must refund, to the receiver the unearned pro rata commission.(5)
If a service agreement company violates any lawful order of the office or fails to meet its contractual obligations under this part, upon notice from the office, the sales representative or agent must refund to the service agreement holder the unearned pro rata commission, unless the sales representative or agent has made other arrangements, satisfactory to the office, with the service agreement holder.(6)(a)
Each service agreement, which includes a copy of the application form, must be mailed, delivered, or otherwise provided to the agreement holder as provided in s. 627.421. As used in s. 627.421, the term:“Insurance policies and endorsements,” “policy and endorsements,” “policy,” and “policy form and endorsement form” include a motor vehicle service agreement and related endorsement forms.
“Insured” includes a motor vehicle service agreement holder.
“Insurer” includes a motor vehicle service agreement company.
If the motor vehicle service agreement company elects to post motor vehicle service agreements on its Internet website in lieu of mailing or delivery to agreement holders, the motor vehicle service agreement company must comply with the requirements of s. 627.421(4).(6)(a)
Each service agreement, which includes a copy of the application form, must be mailed, delivered, or otherwise provided to the agreement holder as provided in s. 627.421. As used in s. 627.421, the term:“Insurance policies and endorsements,” “policy and endorsements,” “policy,” and “policy form and endorsement form” include a motor vehicle service agreement and related endorsement forms.“Insured” includes a motor vehicle service agreement holder.“Insurer” includes a motor vehicle service agreement company.(b)
If the motor vehicle service agreement company elects to post motor vehicle service agreements on its Internet website in lieu of mailing or delivery to agreement holders, the motor vehicle service agreement company must comply with the requirements of s. 627.421(4).(7)
Each service agreement form must contain in conspicuous, boldfaced type any statement or clause that places restrictions or limitations on the benefits offered or disclose such restrictions or limitations in regular type in a section of the service agreement containing a conspicuous, boldfaced type heading.(8)
If an insurer or service agreement company intends to use or require the use of remanufactured or used replacement parts, each service agreement form as well as all service agreement brochures must contain in conspicuous, boldfaced type a statement to that effect.(9)
Each service agreement form as well as all service agreement company sales brochures must clearly identify the name, address, and Florida license number of the licensed insurer or service agreement company.(10)
If a service agreement contains a rental car provision, it must disclose the terms and conditions of this benefit in conspicuous, boldfaced type or disclose such restrictions or limitations in regular type in a section of the service agreement containing a conspicuous, boldfaced type heading.(11)
By July 1, 2011, each service agreement sold in this state must be accompanied by a written disclosure to the consumer that the rate charged for the service agreement is not subject to regulation by the office. A service agreement company may comply with this requirement by including such disclosure in its service agreement form or in a separate written notice provided to the consumer at the time of sale.
Source:
Section 634.121 — Forms, required procedures, provisions; delivery and definitions, https://www.flsenate.gov/Laws/Statutes/2024/0634.121 (accessed Aug. 7, 2025).