BILL REQ. #: H-3288.1
State of Washington | 63rd Legislature | 2014 Regular Session |
READ FIRST TIME 01/20/14.
AN ACT Relating to the regulation of service contracts and protection product guarantees; and amending RCW 48.110.030.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
Sec. 1 RCW 48.110.030 and 2011 c 47 s 16 are each amended to read
as follows:
(1) A person may not act as, or offer to act as, or hold himself or
herself out to be a service contract provider in this state, nor may a
service contract be sold to a consumer in this state, unless the
service contract provider has a valid registration as a service
contract provider issued by the commissioner.
(2) Applicants to be a service contract provider must make an
application to the commissioner upon a form to be furnished by the
commissioner. The application must include or be accompanied by the
following information and documents:
(a) All basic organizational documents of the service contract
provider, including any articles of incorporation, articles of
association, partnership agreement, trade name certificate, trust
agreement, shareholder agreement, bylaws, and other applicable
documents, and all amendments to those documents;
(b) The identities of the service contract provider's executive
officer or officers directly responsible for the service contract
provider's service contract business, and, if more than fifty percent
of the service contract provider's gross revenue is derived from the
sale of service contracts, the identities of the service contract
provider's directors and stockholders having beneficial ownership of
ten percent or more of any class of securities;
(c) Audited annual financial statements or other financial reports
acceptable to the commissioner for the two most recent years which
prove that the applicant is solvent and any information the
commissioner may require in order to review the current financial
condition of the applicant. If the service contract provider is
relying on RCW 48.110.050(2)(c) to assure the faithful performance of
its obligations to service contract holders, then the audited financial
statements of the service contract provider's parent company must also
be filed. The requirements of this subsection (2)(c) do not apply to
a service contract provider that is relying on insuring its service
contracts as provided in RCW 48.110.050(2)(a) or 48.110.075(2)(a) to
assure the faithful performance of its obligations to service contract
holders;
(d) An application fee of two hundred fifty dollars, which must be
deposited into the general fund; and
(e) Any other pertinent information required by the commissioner.
(3) Each registered service contract provider must appoint the
commissioner as the service contract provider's attorney to receive
service of legal process issued against the service contract provider
in this state upon causes of action arising within this state. Service
upon the commissioner as attorney constitutes effective legal service
upon the service contract provider.
(a) With the appointment the service contract provider must
designate the person to whom the commissioner must forward legal
process so served upon him or her.
(b) The appointment is irrevocable, binds any successor in interest
or to the assets or liabilities of the service contract provider, and
remains in effect for as long as there could be any cause of action
against the service contract provider arising out of any of the service
contract provider's contracts or obligations in this state.
(c) The service of process must be accomplished and processed in
the manner prescribed under RCW 48.02.200.
(4) The commissioner may refuse to issue a registration if the
commissioner determines that the service contract provider, or any
individual responsible for the conduct of the affairs of the service
contract provider under subsection (2)(b) of this section, is not
competent, trustworthy, financially responsible, or has had a license
as a service contract provider or similar license denied or revoked for
cause by any state.
(5) A registration issued under this section is valid, unless
surrendered, suspended, or revoked by the commissioner, or not renewed
for so long as the service contract provider continues in business in
this state and remains in compliance with this chapter. A registration
is subject to renewal annually on the first day of July upon
application of the service contract provider and payment of a fee of
two hundred dollars, which must be deposited into the general fund. If
not so renewed, the registration expires on the June 30th next
preceding.
(6) A service contract provider must keep current the information
required to be disclosed in its registration under this section by
reporting all material changes or additions within thirty days after
the end of the month in which the change or addition occurs.