{"data":{"id":"us-ok/okla.-stat.-tit.-36-36-6753","jurisdiction":"us-ok","citation":"Okla. Stat. tit. 36, § 36-6753","heading":"Home service contracts - Requirements for sale - Provider","body":"responsibilities.\n\nA. Home service contracts shall not be issued, sold or offered\n\nfor sale in this state unless the provider has:\n\n1. Provided a receipt for, or other written evidence of, the\n\npurchase of the home service contract to the contract holder; and\n\n2. Provided a copy of the home service contract to the service\n\ncontract holder within a reasonable period of time from the date of\n\npurchase.\n\nB. Each provider of home service contracts sold in this state\n\nshall file a registration with, and on a form prescribed by, the\n\nInsurance Commissioner consisting of their name, full corporate\n\nphysical street address, telephone number, contact person and a\n\ndesignated person in this state for service of process. Each\n\nprovider shall pay to the Commissioner a fee in the amount of One\n\nThousand Two Hundred Dollars ($1,200.00) upon initial registration\n\nand every three (3) years thereafter. Each provider shall pay to\n\nthe Commissioner an Antifraud Assessment Fee of Two Thousand Two\n\nHundred Fifty Dollars ($2,250.00) upon initial registration and\n\nevery three (3) years thereafter. The registration need only be\n\nupdated by written notification to the Commissioner if material\n\nchanges occur in the registration on file. A proper registration is\n\nde facto a license to conduct business in Oklahoma and may be\n\nsuspended as provided in Section 6755 of this title. Fees received\n\nfrom home service contract providers shall not be subject to any\n\npremium tax, but shall be subject to an administrative fee equal to\n\ntwo percent (2%) of the gross fees received on the sale of all home\n\nservice contracts issued in this state during the preceding calendar\n\nquarter. The fees shall be paid quarterly to the Commissioner and\n\nsubmitted along with a report on a form prescribed by the\n\nCommissioner. However, service contract providers may elect to pay\n\nan annual administrative fee of Three Thousand Dollars ($3,000.00)\n\nin lieu of the two-percent administrative fee, if the provider\n\nmaintains an insurance policy or policies as provided in paragraph 3\n\nof subsection C of this section.\n\nC. In order to assure the faithful performance of a provider's\n\nobligations to its contract holders, each provider shall be\n\nresponsible for complying with the requirements of paragraph 1, 2 or\n\n3 of this subsection:\n\n1. a. maintain a funded reserve account for its obligations\n\nunder its contracts issued and outstanding in this\n\nstate. The reserves shall not be less than forty\n\npercent (40%) of gross consideration received, less\n\nclaims paid, on the sale of the service contract for\n\nall in-force contracts. The reserve account shall be\n\nsubject to examination and review by the Commissioner,\n\nand\n\nb. place in trust with the Commissioner a financial\n\nsecurity deposit, having a value of not less than five\n\npercent (5%) of the gross consideration received, less\n\nclaims paid, on the sale of the service contract for\n\nall service contracts issued and in force, but not\n\nless than Twenty-five Thousand Dollars ($25,000.00),\n\nconsisting of one of the following:\n\n(1) a surety bond issued by an authorized surety,\n\n(2) securities of the type eligible for deposit by\n\nauthorized insurers in this state,\n\n(3) a letter of credit issued by a qualified\n\nfinancial institution, or\npaid, on the sale of the service contract for\n\nall service contracts issued and in force, but not\n\nless than Twenty-five Thousand Dollars ($25,000.00),\n\nconsisting of one of the following:\n\n(1) a surety bond issued by an authorized surety,\n\n(2) securities of the type eligible for deposit by\n\nauthorized insurers in this state,\n\n(3) a letter of credit issued by a qualified\n\nfinancial institution, or\n\n(4) another form of security prescribed by rule\n\npromulgated by the Commissioner;\n\n2. a. maintain, or together with its parent company\n\nmaintain, a net worth or stockholders' equity of\n\nTwenty-five Million Dollars ($25,000,000.00),\n\nexcluding goodwill, intangible assets, customer lists\n\nand affiliated receivables, and\n\nb. upon request, provide the Commissioner with a copy of\n\nthe provider's or the provider's parent company's most\n\nrecent Form 10-K or Form 20-F filed with the\n\nSecurities and Exchange Commission (SEC) within the\n\nlast calendar year, or if the company does not file\n\nwith the SEC, a copy of the company's financial\n\nstatements, which shows a net worth of the provider or\n\nits parent company of at least Twenty-five Million\n\nDollars ($25,000,000.00) based upon Generally Accepted\n\nAccounting Principles (GAAP) accounting standards. If\n\nthe provider's parent company's Form 10-K, Form 20-F,\n\nor financial statements are filed to meet the\n\nprovider's financial stability requirement, then the\n\nparent company shall agree to guarantee the\n\nobligations of the provider relating to service\n\ncontracts sold by the provider in this state; or\n\n3. Purchase one or more insurance policies which collectively\n\ncover one hundred percent (100%) of its claim exposure. The\n\ninsurance shall be obtained from one or more insurers that are\n\nlicensed, registered, or otherwise authorized to do business in this\n\nstate, that is rated B++ or better by A.M. Best Company, Inc., and\n\nthat meets the requirements of subsection D of this section. For\n\nthe purposes of this paragraph, the insurance policy or policies\n\nshall contain the following provisions:\n\na. in the event that the provider is unable to fulfill\n\nits obligation under contracts issued in this state\n\nfor any reason including insolvency, bankruptcy, or\n\ndissolution, the insurer shall pay losses and unearned\n\npremiums under such plans directly to the person\n\nmaking the claim under the contract,\n\nb. the insurer issuing the insurance policy shall assume\n\nfull responsibility for the administration of claims\n\nin the event of the inability of the provider to do\n\nso, and\n\nc. the policy shall not be canceled or not renewed by\n\neither the insurer or the provider unless sixty (60)\n\ndays' written notice thereof has been given to the\n\nCommissioner by the insurer before the date of such\n\ncancellation or nonrenewal.\n\nD. Each insurer providing an insurance policy used to satisfy\n\nthe financial responsibility requirements of paragraph 3 of\n\nsubsection C of this section shall meet one of the following\n\nstandards:\n\n1. The insurer shall, at the time the policy is filed with the\n\nCommissioner, and continuously thereafter:\n\na. maintain surplus as to policyholders and paid-in\n\ncapital of at least Fifteen Million Dollars\n\n($15,000,000.00), and\n\nb. annually file copies of the audited financial\n\nstatements of the insurer, its National Association of\n\nInsurance Commissioners (NAIC) Annual Statement, and\n\nthe actuarial certification required by and filed in\n\nthe state of domicile of the insurer; or\n\n2. The insurer shall, at the time the policy is filed with the\n\nCommissioner, and continuously thereafter:\n\na. maintain surplus as to policyholders and paid-in\n\ncapital of less than Fifteen Million Dollars\n\n($15,000,000.00),\n\nb. demonstrate to the satisfaction of the Commissioner\n\nthat the company maintains a ratio of net written\n\npremiums, wherever written, to surplus as to\n\npolicyholders and paid-in capital of not greater than\n\nthree to one, and\ned with the\n\nCommissioner, and continuously thereafter:\n\na. maintain surplus as to policyholders and paid-in\n\ncapital of less than Fifteen Million Dollars\n\n($15,000,000.00),\n\nb. demonstrate to the satisfaction of the Commissioner\n\nthat the company maintains a ratio of net written\n\npremiums, wherever written, to surplus as to\n\npolicyholders and paid-in capital of not greater than\n\nthree to one, and\n\nc. annually file copies of the audited financial\n\nstatements of the insurer, its NAIC Annual Statement,\n\nand the actuarial certification required by and filed\n\nin the state of domicile of the insurer.\n\nE. Except for the registration requirements in subsection B of\n\nthis section, providers, administrators and other persons marketing,\n\nselling or offering to sell home service contracts are exempt from\n\nany licensing requirements of this state and shall not be subject to\n\nother registration information or security requirements. Home\n\nservice contract providers as defined in Section 6752 of this title\n\nand properly registered under this law are exempt from any treatment\n\npursuant to the Service Warranty Act. Home service contract\n\nproviders applying for registration under the Oklahoma Home Service\n\nContract Act that have not been registered in the preceding twelve\n\n(12) months under the Oklahoma Home Service Contract Act may be\n\nsubject to a thirty-day prior review before their registration is\n\ndeemed complete. Said applications shall be deemed complete after\n\nthirty (30) days unless the Commissioner takes action in that period\n\nunder Section 6755 of this title, for cause shown, to suspend their\n\nregistration.\n\nF. The marketing, sale, offering for sale, issuance, making,\n\nproposing to make and administration of home service contracts by\n\nproviders and related service contract sellers, administrators, and\n\nother persons including but not limited to real estate licensees,\n\nshall be exempt from all other provisions of the Insurance Code.","path":["OK Code","Title 36"],"source_url":"https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os36.pdf","current_through":"2026-08-14","vintage":"open-us-law v2026.08, retrieved 2026-09-14","retrieved_at":"2026-09-14T18:32:36Z","sha256":"852d743978ab9cd097b01f49a46a004f605bdfd55a751312a1c240cf03c116c7","source_id":"us-ok","stale":false,"prev":"us-ok/okla.-stat.-tit.-36-36-6752","next":"us-ok/okla.-stat.-tit.-36-36-6754"},"notice":"GroundRules: Original legal text. Not legal advice."}