Requires businesses to disclose certain information regarding extended warranties

Title of bill

An act to amend the general business law, in relation to requiring any business that offers extended warranties to provide the consumer statistical data concerning how many times the extended warranty has to be utilized by consumers for that particular product, an explanation as to the reason the extended warranty was utilized, and if there were any instances in which the extended warranty was not honored by the business

Summary of provisions

Section One of the bill amends the General Business law to add a new section, 349-f which states that any corporation or other business entity operating within the State that offers extended warranties on products purchased by or provided to consumers located in the State shall make available on its website statistical data, compiled annually, of how many times the extended warranty has been utilized by consumers for each product for which an extended warranty is offered, together with an explanation as to the reason the extended warranty was utilized, and, if there are any instances in which the extended warranty was not honored information as to the number of times the warranty was not honored and an explanation of the reasons why it was not honored.

Existing law

Currently, businesses in New York do not have to share with consumers statistical data about their extended warranty services.

Justification

There is no uniform standard of what an "extended warranty" means in the State of New York. Consumers are often given the opportunity to purchase an extended warranty, sometimes for hundreds of dollars, when buying a major appliance (such as a refrigerator), an electronic device, or a motor vehicle (new or used). While these types of "durable goods" typically come with manufacturers' warranties, the warranties may be limited in scope. An extended warranty may cover parts and labor not included in the manufacturer's warranty and may even extend the manufacturer's warranty for a longer period of time.

Many times a consumer has no information on which to judge if the extended warranty is likely to be needed, and has limited information as to what the extended warranty actually covers. Under current law there is no reliable way for the consumer to ascertain the statistical data needed to make an informed decision on whether or not to purchase an extended warranty.

This bill will help New York consumers by requiring any business that offers extended warranties to provide on its website the statistical data concerning how many times the extended warranty has been utilized by consumers for each particular product, an explanation as to the reasons the extended warranty was utilized, and information about any instances in which the extended warranty was not honored by the business.

Legislative history

S.5017-A of 2013-2014 (Hoylman): Died in Consumer Protection

Fiscal implications

None to the State of New York.

Local fiscal implications

None to the State of New York.

Effective date

This act shall take effect on the first of January next succeeding the date upon which it shall become a law.