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WashingtonHB 10062025-2026 Regular SessionHouseWALLET

Regulating service contracts and protection product guarantees.

Sponsored By: Cindy Ryu (Democratic)

Became Law

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Bill Overview

Analyzed Economic Effects

7 provisions identified: 3 benefits, 1 costs, 3 mixed.

Clear car contract terms and claims

Car service contracts must clearly say if an insurer backs them and list the insurer’s name, address, and policy number. They must show price, covered parts, limits, return rights, deductibles, claim steps, and 24‑hour help, and include a conspicuous, initialed maintenance notice. A provider cannot deny a claim just for poor maintenance unless that failure involved the specific part that failed.

Direct insurer help if provider fails

Reimbursement insurers must pay what your provider owes, including a full refund or the promised service. If the policy pays only after provider default, the insurer must pay 30 days after proof of loss; if the provider has closed, you can apply right away. Any payment you make to the provider counts as payment to the insurer.

Keep disputes local and add remedies

Contracts cannot force you to sue outside Washington. If there is binding arbitration, the hearing must be near your home. Breaking these rules is an unfair or deceptive act under the Consumer Protection Act, and you may sue the provider and each reimbursement insurer. Registered providers must name the Insurance Commissioner to receive legal papers for Washington cases.

Easier refunds on service contracts

Non‑motor service contracts can be returned within 20 days after mailing or 10 days if given at sale. If no claim was made, the contract is void and you get a full refund; late refunds owe a 10% monthly penalty after 30 days. Motor‑vehicle contracts allow a full refund within 30 days if no claim; returns 10–30 days may be charged up to a $25 fee. After 30 days, refunds are pro rata by time or mileage, minus up to $25. Providers have 60 days after sale to decide if your vehicle qualifies; after that they must honor the contract.

Stronger financial backing and state review

Providers must back their promises in one of three ways. They can use reimbursement insurance from an authorized insurer with at least $15,000,000 in surplus (or $10,000,000 with a 3:1 premium‑to‑surplus ratio and approval); keep a funded reserve equal to 40% of gross payments (after claims) plus a security deposit of 5% of gross payments, at least $25,000; or have $100,000,000 in net worth or a parent guarantee. Reimbursement policies and all motor‑vehicle service contract forms must be filed with and approved by the Insurance Commissioner; manufacturers must file within 60 days of first use. The Commissioner can reject forms that are illegal or misleading. If an insurer pays what a provider should have paid, the insurer may seek repayment from the provider.

Registration and fees for guarantee providers

To sell protection product guarantees in Washington, providers must register with the Insurance Commissioner. The application includes a $250 nonrefundable fee, recent financials showing at least $200,000 in net worth or equity, and other required documents. The Commissioner may deny registration for lack of trustworthiness, weak finances, or past license revocations. Registrations renew each July 1 with a $250 fee and expire June 30 if not renewed. Providers must report material changes within 30 days after the month they occur.

Updated definitions for covered contracts

The law updates many definitions for service contracts and protection product guarantees. These definitions set who is covered and how the other rules apply.

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Sponsors & Cosponsors

Sponsor

  • Cindy Ryu

    Democratic • House

Cosponsors

  • Kristine Reeves

    Democratic • House

  • Stephanie McClintock

    Republican • House

Roll Call Votes

All Roll Calls

Yes: 144 • No: 0

Senate vote • 4/5/2025

3rd Reading & Final Passage

Yes: 48 • No: 0 • Other: 1

House vote • 1/30/2025

3rd Reading & Final Passage

Yes: 96 • No: 0 • Other: 2

Actions Timeline

  1. Effective date 7/27/2025.

    4/16/2025House

  2. Chapter 50, 2025 Laws.

    4/16/2025House

  3. Governor signed.

    4/16/2025legislature

  4. Delivered to Governor.

    4/11/2025legislature

  5. President signed.

    4/10/2025legislature

  6. Speaker signed.

    4/9/2025legislature

  7. Third reading, passed; yeas, 48; nays, 0; absent, 0; excused, 1.

    4/5/2025House

  8. Rules suspended. Placed on Third Reading.

    4/5/2025House

  9. Placed on second reading consent calendar.

    4/2/2025House

  10. Passed to Rules Committee for second reading.

    3/27/2025House

  11. BFT - Majority; do pass.

    3/26/2025House

  12. First reading, referred to Business, Financial Services & Trade.

    1/31/2025House

  13. Third reading, passed; yeas, 96; nays, 0; absent, 0; excused, 2.

    1/30/2025House

  14. Rules suspended. Placed on Third Reading.

    1/30/2025House

  15. Rules Committee relieved of further consideration. Placed on second reading.

    1/28/2025House

  16. Referred to Rules 2 Review.

    1/23/2025House

  17. CPB - Executive action taken by committee.

    1/21/2025House

  18. CPB - Majority; do pass.

    1/21/2025House

  19. First reading, referred to Consumer Protection & Business.

    1/13/2025House

  20. Introduced

    1/13/2025House

Bill Text

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