RÉSUMÉ DIGEST
ACT 657 (HB 340) 2016 Regular Session Stokes
New law provides relative to an unsolicited offer, made by mail or common carrier, to sell
to another an extended service agreement relative to a motor vehicle.
New law provides that if the unsolicited offer is in writing, it shall state at the top of each
page "THIS IS AN ADVERTISEMENT TO PURCHASE AN EXTENDED SERVICE
AGREEMENT ON A MOTOR VEHICLE. IT IS NOT AN OFFICIAL DOCUMENT." The
statement shall be in conspicuous and legible type that is not smaller than fourteen-point font
and is in contrast by typography, layout, or color with any other printing on the writing.
New law provides that if the unsolicited offer is oral, it shall begin and end with the
statement: "THIS IS AN ADVERTISEMENT TO PURCHASE AN EXTENDED SERVICE
AGREEMENT ON A MOTOR VEHICLE. IT IS NOT AN OFFICIAL NOTIFICATION OR
DEMAND FOR ACTION."
New law provides that a violation of new law shall constitute a deceptive and unfair trade
practice and subject the violator to any and all actions and penalties authorized for such
violations. Further provides that each offer in violation of the new law shall be considered
a separate offense.
New law defines "extended service agreement" to include any vehicle mechanical breakdown
insurance policy, vehicle service contract sold by an independent payment provider or their
agent, or vehicle component coverage contract. "Unsolicited offer" shall not include an offer
made subsequent to a prior personal contact that included a meaningful exchange between
the offeror and offeree.
New law provides exception from new law for any manufacturer, distributor, or dealer of
motor vehicles as defined in existing law (R.S. 32:1252), any vehicle mechanical breakdown
insurer licensed pursuant to existing law (R.S. 22:362), any person acting pursuant to an
agreement of and on behalf of such manufacturer, distributor, dealer, or licensed vehicle
mechanical breakdown insurer, any entity licensed pursuant to existing law (R.S. 6:969.37),
or any Federal Deposit Insurance Corporation (FDIC) or National Credit Union
Administration (NCUA) insured depository financial institution operating with a main office
or one or more branches in this state, or their subsidiaries or affiliates.
Effective August 1, 2016.
(Adds R.S. 51:1422)