Vehicle Protection Product Act; revised to include component parts of a vehicle

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HB582
DG4VMNT-1
By Representative Paramore
RFD: Commerce and Small Business
First Read: 05-Mar-26
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DG4VMNT-1 03/03/2026 CMH (L)CMH 2026-1115
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First Read: 05-Mar-26
SYNOPSIS:
Under existing law, the Vehicle Protection
Product Act regulates vehicle protection product
warrantors and associated vehicle protection products,
which include vehicle protection devices, systems, or
services that are installed on a vehicle, designed to
prevent loss or damage to the vehicle, and include a
written warranty.
This bill would revise the Vehicle Protection
Product Act to include component parts of a vehicle
within the meaning of vehicle protection product.
A BILL
TO BE ENTITLED
AN ACT
Relating to consumer protection; to amend Section
8-33-2, Code of Alabama 1975, to provide that the requirements
of the Vehicle Protection Product Act apply to component parts
of a vehicle.
BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
Section 1. Section 8-33-2, Code of Alabama 1975, is
amended to read as follows:
"§8-33-2
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"§8-33-2
As used in this chapter, the following words shall have
the following meanings:
(1) ADMINISTRATOR. A third party other than the
warrantor who is designated by the warrantor to be responsible
for the administration of vehicle protection product
warranties.
(2) COMMISSIONER. The Commissioner of the Department of
Insurance.
(3) COMPONENT PART. Any individual, functional part of
a vehicle which, when combined with other parts, constitutes a
motor vehicle. The term includes an engine, transmission, and
body panel.
(3)(4) DEPARTMENT. The Department of Insurance.
(4)(5) INCIDENTAL COSTS. Expenses specified in the
warranty incurred by the warranty holder related to the
failure of the vehicle protection product to perform as
provided in the warranty. Incidental costs may include,
without limitation, insurance policy deductibles, rental
vehicle charges, the difference between the actual value of
the stolen vehicle at the time of theft and the cost of a
replacement vehicle, sales taxes, registration fees,
transaction fees, and mechanical inspection fees.
(5)(6) SERVICE CONTRACT. A contract or agreement as
defined in subdivision (13) of Section 8-32-2.
(6)(7) VEHICLE PROTECTION PRODUCT. A vehicle protection
device, system, or service that is all of the following:
a. Installed on or applied to a vehicle or a component
part of a vehicle .
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part of a vehicle .
b. Is designed to prevent loss or damage to a vehicle
or a component part of a vehicle from a specific cause.
c. Includes a written warranty.
For purposes of this chapter, the term vehicle
protection product shall include, without limitation, alarm
systems ,; body part marking products ,; steering locks ,; window
etch products ,; pedal and ignition locks ,; fuel and ignition
kill switches ,; and electronic, radio, and satellite tracking
devices. A vehicle protection product is not insurance for any
purpose.
(7)(8) VEHICLE PROTECTION PRODUCT WARRANTOR or
WARRANTOR. A person who is contractually obligated to the
warranty holder under the terms of the vehicle protection
product warranty agreement. Warrantor does not include an
authorized insurer providing a warranty reimbursement
insurance policy.
(8)(9) VEHICLE PROTECTION PRODUCT WARRANTY or WARRANTY.
A written agreement by a warrantor that provides if the
vehicle protection product fails to prevent loss or damage to
a vehicle or a component part of a vehicle from a specific
cause, that the warranty holder shall be paid specified
incidental costs by the warrantor as a result of the failure
of the vehicle protection product to perform pursuant to the
terms of the warranty. Incidental costs may be reimbursed
under the provisions of the warranty in either a fixed amount
specified in the warranty or sales agreement or by use of a
formula itemizing specific incidental costs incurred by the
warranty holder.
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warranty holder.
(9)(10) WARRANTY HOLDER. The person who purchases a
vehicle protection product or who is a permitted transferee.
(10)(11) WARRANTY REIMBURSEMENT INSURANCE POLICY. A
policy of insurance that is issued to the vehicle protection
product warrantor to provide reimbursement to the warrantor or
to pay on behalf of the warrantor all covered contractual
obligations incurred by the warrantor under the terms and
conditions of the insured vehicle protection product
warranties sold by the warrantor."
Section 2. This act shall become effective on October
1, 2026.
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