4. MANDATORY SERVICE CONTRACT DISCLOSURES - PART 2
EXCLUSIONS: THE FINE PRINT THAT OBLIGORS USE TO DENY YOUR CLAIM

EXCLUSIONS: Service contract exclusions are the most important part of the contract. Read over the exclusions five or six times before agreeing to buy:

• EXCLUSIONS GENERALLY: Any exclusions must be conspicuously disclosed in bold print. This includes any exclusion of services, parts, characteristics, components, properties, defects, malfunctions, causes, conditions, repairs, or remedies. It also must include any maximum number of repairs or cost.
• "PRE-EXISTING CONDITIONS": Any exclusion for "pre-existing" conditions must be disclosed in bold 12 point type. DO NOT BUY any contract which contains any exclusions for "pre-existing condtions". Because the obligor can call anything that breaks on a used car can a "pre-existing condition".
• ANOTHER TRICKY EXCLUSION - "TEAR DOWN ESTIMATES" OR DIAGNOSIS: Often vehicles requiring major engine/transmission repairs (which is why you wanted to buy a service contract in the first place) require a "tear down estimate" which can cost over $1,000.00 in order to learn what repairs are needed. DO NOT BUY any contract which excludes paying for teardowns or diagnostic time.

TRANSFERABILITY TO SUBSEQUENT OWNER: The contract must specically state whether the contract can be transferred to any subsequent buyer of the car.

BUYER'S OBLIGATIONS- The step by step proceudures a buyer must take to receive service, how to notify the obligor, whether the buyer must pay for towing costs, whether the buyer must perform preventitive maintainance (and consequences in they dont), what types of repair facilities the buyer must deliver the car to, and any additional charges the buyer must pay (such as a deductible) have to be clearly listed.