Motor Vehicle Extended Service Contracts FAQs

Disclaimer: This FAQ is provided to assist you with basic factual questions about recent changes to the Missouri motor vehicle extended service contract statutes and to assist you in locating statutes relevant to the questions included. No statement contained in this FAQ is intended as rule or agency statement of general applicability. No statement in this FAQ is intended as a legal interpretation of any statute or regulation.

You are encouraged to consult the statutes themselves, which may be found online at moga.mo.gov/STATUTES/C385.HTM, from section 385.200 to section 385.220.

The new statutes became effective Jan. 1, 2012. The answers provided in this FAQ are intended to be accurate as of that date and afterward.

Recent changes to Missouri's MVESC law

Applying for a Missouri MVESC producer license

After Licensure

 

What is Senate Bill 132 and how does it affect businesses that provide motor vehicle extended service contracts?
Senate Bill 132 was passed in the 2011 Missouri legislative session and signed into law by Gov. Nixon in July 2011. Under SB 132, starting Jan. 1, 2012, a license will be required in order to "sell, offer, negotiate or solicit a motor vehicle extended service contract with a consumer," unless the person doing so falls under one of several exceptions (see section 385.206.1). The bill also enacts some new consumer protections related to MVESCs. Some of those provisions affect providers, including section 385.209, which provides certain grounds under which a provider's registration may be revoked or refused.
 
Who may sell motor vehicle extended service contracts?
Please see section 385.206.1.
What is the difference between a motor vehicle extended service contract provider and a motor vehicle extended service business entity producer?
Section 385.200(14) defines "provider" as "a person who is contractually obligated to the service contract holder under the terms of a motor vehicle extended service contract[.]" Section 385.200(13) defines "producer" as "any business entity or individual person selling, offering, negotiating, or soliciting a motor vehicle extended service contract and required to be licensed as a producer under subsection 1 of section 385.206[.]" A rough analogy to the insurance industry might be made: an MVESC provider would be analogous to an insurance company, while an MVESC producer would be analogous to an insurance producer (formerly referred to as an insurance agent).
What is a provider registration?
Under section 385.202.2, providers "shall file a registration with the director on a form, at a fee and at a frequency prescribed by the director." Section 385.206.1(5) states that "[i]t is unlawful for any person in or from this state to sell, offer, negotiate, or solicit a motor vehicle extended service contract with a consumer, other than the following: … (5) A provider registered with the director and having demonstrated financial responsibility as required in section 385.202, along with its subsidiaries and affiliated entities, and authorized employees of the provider, subsidiary, or affiliated entity[.]" Section 385.200(14) defines a "provider" as "a person who is contractually obligated to the service contract holder under the terms of a motor vehicle extended service contract[.]"
Do car dealers have to be registered as providers or producers?
Section 385.206.1(1) states that "[i]t is unlawful for any person in or from this state to sell, offer, negotiate, or solicit a motor vehicle extended service contract with a consumer, other than the following: … (1) A motor vehicle dealer licensed under sections 301.550 to 301.573, along with its authorized employees offering the service contract in connection with the sale of either a motor vehicle or vehicle maintenance or repair services[.]"
 
Do employees of licensed car dealers have to have an individual producer license?
Section 385.206.1(1) states that "[i]t is unlawful for any person in or from this state to sell, offer, negotiate, or solicit a motor vehicle extended service contract with a consumer, other than the following: … (1) A motor vehicle dealer licensed under sections 301.550 to 301.573, along with its authorized employees offering the service contract in connection with the sale of either a motor vehicle or vehicle maintenance or repair services[.]"
If a motor vehicle extended service contract provider uses an administrator, does the administrator have to have a motor vehicle extended service contract business entity producer license?
Section 385.206.1(7) states that "[i]t is unlawful for any person in or from this state to sell, offer, negotiate, or solicit a motor vehicle extended service contract with a consumer, other than the following: … (7) Authorized employees of an administrator under contract to effect coverage, collect provider fees, and settle claims on behalf of a registered provider, if the administrator is licensed as a business entity producer under section 385.207[.]" No provision of the statutes appears to exempt the administrator, itself, from licensure if it is selling, offering, negotiating or soliciting MVESCs.
If a business is registered as a motor vehicle extended service contract business producer, do the employees also have to have an individual producer license?
Section 385.206.1(6) states that "[i]t is unlawful for any person in or from this state to sell, offer, negotiate, or solicit a motor vehicle extended service contract with a consumer, other than the following: … (6) A business entity producer or individual producer licensed under section 385.207 [.]" Section 385.207.6 states that "[a]n individual, prior to selling, offering, negotiating, or soliciting a motor vehicle extended service contract with a consumer under subdivision (6) of subsection 1 of section 385.206, shall apply for and obtain licensure with the director as an individual producer in accordance with this section."
How can I submit a license application?
Section 385.207 describes the application process for business entity producer and individual producer licenses. A paper application will be available online through the department’s web page at insurance.mo.gov.
Where are the application forms located?
Registration application forms are available here. You may also call the department at 573-526-5001 and ask to have paper copies mailed to you.
When can I start applying for a license?
Dec. 1, 2011.
When do I need to be licensed?
Section 385.206 is effective Jan. 1, 2012.
How much is my license?
The MVESC producer application is $25. The MVESC business entity producer application is $100.
How long will it take for my license to be approved or refused?
The department’s normal processing time for applications with no issues requiring investigation is seven to 10 business days. However, if one or more issues prompt an investigation, the process can take much longer.
May I sell motor vehicle extended service contracts while my license application is being reviewed?
Section 385.206.1 is effective Jan. 1, 2012, and states that "[i]t is unlawful for any person in or from this state to sell, offer, negotiate, or solicit a motor vehicle extended service contract with a consumer, other than" those persons listed in 385.206.1(1) through (8).]
Will current, employed personnel be "grandfathered in" and be qualified to continue working?
Section 385.206.1 is effective Jan. 1, 2012, and states that "[i]t is unlawful for any person in or from this state to sell, offer, negotiate, or solicit a motor vehicle extended service contract with a consumer, other than" those persons listed in 385.206.1(1) through (8).]
If I go to work at a different company selling vehicle service contracts, do I need to apply for a new license?
The statutes do not appearing to contain any provision imposing such a requirement.
Will any past history (e.g. criminal convictions, child support issues) automatically cause refusal of a producer application?
Section 385.209.1 provides that the "director may … refuse to issue … a registration or license under sections 385.200 to 385.220 for any of" the causes listed there. There does not appear to be any provision in the statutes requiring an automatic refusal for any reason.
If a business entity producer hires an employee to sell, offer, negotiate or solicit MVESCs, must the employee have a license prior to working or will there be a grace period in which the employee can sell while the application is being processed?
Section 385.206.1 is effective Jan. 1, 2012, and states that "[i]t is unlawful for any person in or from this state to sell, offer, negotiate, or solicit a motor vehicle extended service contract with a consumer, other than" those persons listed in 385.206.1(1) through (8).]
Will continuing education be required as a condition of MVESC licensure?

There does not appear to be a provision in the statute requiring continuing education as a condition of MVESC licensure.

Must an applicant already have a job with a business entity producer when applying for an individual producer license?

No.

Who do I contact if I have questions?

Calls regarding MVESC producer and business entity producer licensure may be directed to the Licensing Section at 573-751-3518. Calls regarding MVESC provider registrations may be directed to Ronald Musopole at 573-522-8405. Calls regarding Vehicle Protection Product and Service Contract provider registrations may be directed to Susan Doerhoff at 573-751-0794.

Will the State of Missouri provide any training to sales personnel up front as the new law is implemented?

No.

Does a license need to be prominently displayed?

No statute or regulation appears to address this issue.

How often do I need to re-apply for a license?

Section 385.207.5 states that "[u]nless licensure is refused by the director under section 385.209, persons applying for license under this section shall be issued a producer license for a term of two years. A producer's license shall be renewed biennially upon application for renewal and payment of the fee. Such license shall continue in effect unless terminated under subsection 6 of this section, or refused, revoked, or suspended under section 385.209." Section 385.207.6 adds that "[a] producer license issued under this section, if not renewed by the director by its expiration date, shall terminate on its expiration date and shall not after that date authorize its holder under sections 385.200 to 385.220 to sell, offer, negotiate, or solicit motor vehicle extended service contracts."

How and when can the state suspend/revoke a license?

Please see section 385.209.