Under Texas law, extended warranties or “service contracts” are potentially subject to regulatory oversight by four state agencies. The Texas Real Estate Commission (TREC) oversees the licensing and regulation of home warranties—service contracts that cover a structural component, an appliance, or an electrical, plumbing, heating, cooling, or air-conditioning system of a residential property. In contrast, extended warranties that cover most other types of consumer property are typically regulated by the Texas Department of Licensing and Regulation (TDLR). Moreover, extended warranties that fall within exceptions to these statutes or that cover additional types of risks may be regulated as insurance by the Texas Department of Insurance. In addition, all types of consumer warranties are generally subject to oversight by the Texas Attorney General, particularly as to compliance with the Texas Deceptive Trade Practices Act. Locke Lord LLP Austin attorneys Jon L. Gillum and Lauren Fincher have published an in-depth article on the way these risk-transfer contracts are regulated in Texas: “Cross-Agency Regulation of Service Contracts in Texas: Examining the Jurisdiction of the Attorney General of Texas, the Texas Department of Licensing and Regulation, the Texas Real Estate Commission, and the Texas Department of Insurance.” The article is located in Volume 19, Book 1 of the Texas Tech Administrative Law Journal and is currently available in print form and will soon be online at Westlaw or Lexis-Nexis. In addition, the article has been referenced in the following:
“Extending the Murky Divide Between Warranty and Insurance” in Law 360
“Texas Service Contract Law Now Permits Key Fob Replacement” on JDSupra
