{"data":{"id":"us-ok/okla.-stat.-tit.-15-15-140.5","jurisdiction":"us-ok","citation":"Okla. Stat. tit. 15, § 15-140.5","heading":"Vehicle value protection agreements","body":"A. As used in this section:\n\n1. “Administrator” means the person who may be responsible for\n\nthe administrative or operational function of vehicle value\n\nprotection agreements including, but not limited to, the\n\nadjudication of claims or benefits requested by contract holders;\n\n2. “Contract holder” means a person who is the purchaser or\n\nholder of a vehicle value protection agreement;\n\n3. “Provider” means a person that is obligated to provide a\n\nbenefit under a vehicle value protection agreement. A provider may\n\nperform as an administrator or retain the services of a third-party\n\nadministrator; and\n\n4. “Vehicle value protection agreement” means a contractual\n\nagreement that provides a benefit towards either the reduction of\n\nsome or all of the contract holder’s current finance agreement\n\ndeficiency balance, or towards the purchase or lease of a\n\nreplacement motor vehicle or motor vehicle services, upon the\n\noccurrence of an adverse event to the motor vehicle including, but\n\nnot limited to, loss, theft, damage, obsolescence, diminished value,\n\nor depreciation. These agreements do not include debt waivers.\n\nThese agreements may include, but not be limited to, trade-in-credit\n\nagreements, diminished value agreements, depreciation benefit\n\nagreements, or other similarly named agreements.\n\nB. 1. No administrator or provider operating as an\n\nadministrator shall perform or engage in any administrative or\n\noperational functions of vehicle value protection agreements without\n\nfirst registering with the Insurance Department. Registration shall\n\nbe renewed annually by July 15 of each calendar year. All\n\nregistrations shall be filed and fees shall be paid electronically\n\nin the manner and form prescribed by the Insurance Commissioner.\n\n2. An administrator or a provider operating as an administrator\n\nshall electronically file an updated registration within thirty (30)\n\ndays of any change of name, address, or email address.\n\n3. Every administrator and provider, upon receipt of any\n\ninquiry from the Commissioner, shall furnish the Commissioner with\n\nan adequate response to the inquiry within twenty (20) days from the\n\ndate of receipt of the inquiry.\n\nC. Requirements for offering vehicle value protection\n\nagreements:\n\n1. A provider may utilize an administrator or other designee to\n\nbe responsible for any and all of the administration of vehicle\n\nvalue protection agreements in compliance with Section 140.2 et seq.\n\nof this title;\n\n2. Vehicle value protection agreements shall not be sold unless\n\nthe contract holder has been or will be provided access to a copy of\n\nthat vehicle value protection agreement;\n\n3. In order to assure the faithful performance of the\n\nprovider’s obligations to its contract holders, each provider shall\n\nbe responsible for complying with the requirements of one of the\n\nfollowing:\n\na. insure all of its vehicle value protection agreements\n\nunder an insurance policy that covers one hundred\n\npercent (100%) of its claim exposure, satisfies the\n\nrequirements of this act, and contains the following\n\nprovision: “In the event the provider is unable to\n\nfulfill its obligations under vehicle value protection\n\nagreements issued in this state for any reason\n\nincluding insolvency, bankruptcy, or dissolution, the\n\ninsurer will pay any losses and unearned fees to the\n\nperson making a claim under such agreement.” The\n\ninsurance policy shall be issued by an insurer\n\nlicensed, registered, or otherwise authorized to do\n\nbusiness in this state either:\ne to\n\nfulfill its obligations under vehicle value protection\n\nagreements issued in this state for any reason\n\nincluding insolvency, bankruptcy, or dissolution, the\n\ninsurer will pay any losses and unearned fees to the\n\nperson making a claim under such agreement.” The\n\ninsurance policy shall be issued by an insurer\n\nlicensed, registered, or otherwise authorized to do\n\nbusiness in this state either:\n\n(1) at the time the policy is filed with the\n\nInsurance Commissioner, and continuously\n\nthereafter, (i) maintain surplus as to\n\npolicyholders and paid-in capital no less than\n\nFifteen Million Dollars ($15,000,000.00) and (ii)\n\nannually file copies of the insurer’s financial\n\nstatements, its National Association of Insurance\n\nCommissioners (NAIC) Annual Statement, and the\n\nactuarial certification required by and filed in\n\nthe insurer’s state of domicile, or\n\n(2) at the time the policy is filed with the\n\nCommissioner, and continuously thereafter, (i)\n\nmaintain surplus as to policyholders and paid-in\n\ncapital of less than Fifteen Million Dollars\n\n($15,000,000.00) but at least equal to Ten\n\nMillion Dollars ($10,000,000.00), (ii)\n\ndemonstrate to the satisfaction of the\n\nCommissioner that the company maintains a ratio\n\nof net written premiums, wherever written, to\n\nsurplus as to policyholders and paid-in capital\n\nof not greater than 3 to 1, and (iii) annually\n\nfile copies of the insurer’s audited financial\n\nstatements, its NAIC Annual Statement, and the\n\nactuarial certification required by and filed in\n\nthe insurer’s state of domicile,\n\nb. (1) maintain a funded reserve account for its\n\nobligations under its contracts issued and\n\noutstanding in this state. The reserves shall\n\nnot be less than forty percent (40%) of gross\n\nconsiderations received, less claims paid, on the\n\nsale of the vehicle value protection agreement\n\nfor all in-force contracts. The reserve account\n\nshall be subject to examination and review by the\n\nCommissioner, and\n\n(2) place in trust with the Commissioner a financial\n\nsecurity deposit, having a value not less than\n\nfive percent (5%) of the gross consideration\n\nreceived, less claims paid, on the sale of the\n\nvehicle value protection agreements for all\n\nvehicle value protection agreements issued and in\n\nforce, but not less than Twenty-five Thousand\n\nDollars ($25,000.00), consisting of the\n\nfollowing:\n\n(a) a surety bond issued by an authorized\n\nsurety,\n\n(b) securities of the type eligible for deposit\n\nby authorized insurers in this state,\n\n(c) a letter of credit issued by a qualified\n\nfinancial institution, or\n\n(d) another form of security prescribed by\n\nregulations issued by the Commissioner, or\n\nc. (1) maintain, or together with its parent company\n\nmaintain, a net worth or stockholders’ equity of\n\nOne Hundred Million Dollars ($100,000,000.00),\n\nand\nsecurities of the type eligible for deposit\n\nby authorized insurers in this state,\n\n(c) a letter of credit issued by a qualified\n\nfinancial institution, or\n\n(d) another form of security prescribed by\n\nregulations issued by the Commissioner, or\n\nc. (1) maintain, or together with its parent company\n\nmaintain, a net worth or stockholders’ equity of\n\nOne Hundred Million Dollars ($100,000,000.00),\n\nand\n\n(2) upon request, provide the Commissioner with a\n\ncopy of the provider’s or the provider’s parent\n\ncompany’s most recent Form 10-K or Form 20-F\n\nfiled with the Securities and Exchange Commission\n\n(SEC) within the last calendar year, or if the\n\ncompany does not file with the SEC, a copy of the\n\ncompany’s audited financial statements, which\n\nshows a net worth of the provider or its parent\n\ncompany of at least One Hundred Million Dollars\n\n($100,000,000.00). If the provider’s parent\n\ncompany’s Form 10-K, Form 20-F, or financial\n\nstatements are filed to meet the provider’s\n\nfinancial security requirement, then the parent\n\ncompany shall agree to guarantee the obligations\n\nof the provider relating to the vehicle value\n\nprotection agreements sold by the provider in\n\nthis state; and\n\n4. Except for the requirements in paragraph 3 of subsection C\n\nof this section, no other financial security requirements shall be\n\nrequired for vehicle value protection agreement providers.\n\nD. Vehicle value protection agreements shall disclose in\n\nwriting and in clear, understandable language the following:\n\n1. The name and address of the provider, contract holder, and\n\nadministrator, if any;\n\n2. The terms of the vehicle value protection agreement\n\nincluding without limitation, the purchase price to be paid by the\n\ncontract holder, the requirements for eligibility, conditions of\n\ncoverage, or exclusions;\n\n3. That the vehicle value protection agreement may be canceled\n\nby the contract holder within a free look period as specified in the\n\nvehicle value protection agreement, and in such an event, the\n\ncontract holder shall be entitled to a full refund of the purchase\n\nprice paid by the contract holder, if any, as long as no benefits\n\nhave been provided;\n\n4. The procedure the contract holder shall follow, if any, to\n\nobtain a benefit under the terms and conditions of the vehicle value\n\nprotection agreement including, if applicable, a telephone number or\n\nwebsite and address where the contract holder may apply for a\n\nbenefit;\n\n5. Whether or not the vehicle value protection agreement is\n\ncancelable after the free look period and the conditions under which\n\nit may be canceled including the procedures for requesting any\n\nrefund of the unearned purchase price paid by the contract holder;\n\n6. In the event of cancelation, the methodology for calculating\n\nany refund of the unearned purchase price of the vehicle value\n\nprotection agreement due;\n\n7. That neither the extension of credit, the terms of the\n\ncredit, nor the terms of the related motor vehicle sale or lease may\n\nbe conditioned upon the purchase of the vehicle value protection\n\nagreement; and\n\n8. Vehicle value protection agreements shall state the terms\n\nand restrictions, or conditions governing cancelation of the vehicle\n\nvalue protection agreement prior to the termination or expiration\n\ndate of the vehicle value protection agreement by either the\n\nprovider or the contract holder. The provider of the vehicle value\n\nprotection agreement shall mail a written notice to the contract\n\nholder at the last known address of the contract holder contained in\n\nthe records of the provider at least five (5) days prior to\n\ncancelation by the provider. Prior notice shall not be required if\n\nthe reason for cancelation is nonpayment of the provider fee, a\n\nmaterial misrepresentation by the contract holder to the provider or\n\nadministrator, or a substantial breach of duties by the contract\n\nholder relating to the covered product or its use. The notice shall\nn\n\nthe records of the provider at least five (5) days prior to\n\ncancelation by the provider. Prior notice shall not be required if\n\nthe reason for cancelation is nonpayment of the provider fee, a\n\nmaterial misrepresentation by the contract holder to the provider or\n\nadministrator, or a substantial breach of duties by the contract\n\nholder relating to the covered product or its use. The notice shall\n\nstate the effective date of cancelation and the reason for the\n\ncancelation. If a vehicle value protection agreement is canceled by\n\nthe provider for a reason other than nonpayment of the provider fee,\n\nthe provider shall refund the contract holder one hundred percent\n\n(100%) of the unearned pro rata provider fee paid by the contract\n\nholder, if any. If coverage under the vehicle value protection\n\nagreement continues after a claim, then any refund may deduct claims\n\npaid. A reasonable administrative fee may be charged by the\n\nprovider not to exceed Seventy-five Dollars ($75.00).\n\nE. Subsection D of this section and Section 140.6 of this title\n\nshall not apply to vehicle value protection agreements offered in\n\nconnection with a commercial transaction.","path":["OK Code","Title 15"],"source_url":"https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os15.pdf","current_through":"2026-08-14","vintage":"open-us-law v2026.08, retrieved 2026-09-14","retrieved_at":"2026-09-14T18:32:36Z","sha256":"39b3cb84b5b59b43334ab3e64dee58b0e9bd9ef938e7453b354ff82c2b5307d7","source_id":"us-ok","stale":false,"prev":"us-ok/okla.-stat.-tit.-15-15-140.4","next":"us-ok/okla.-stat.-tit.-15-15-140.6"},"notice":"GroundRules: Original legal text. Not legal advice."}