SB74 Alabama 2016 Session

Updated Feb 27, 2026

Low Interest

Summary

Primary Sponsor: Clyde ChamblissSenator
Republican
Session: Regular Session 2016
Title: Insurance, service contracts, term "road hazard" defined, service contracts related to motor vehicles further provided for, Sec. 8-32-2 am'd.
Summary: SB74 defines 'road hazard' and specifies the damages from road hazards that must be covered by motor vehicle service contracts in Alabama.
What This Bill Does
It adds a formal definition of road hazard as hazards encountered while driving a motor vehicle, including potholes, rocks, debris, curbs, and similar items. It then lists the damages that a service contract would cover if caused by a road hazard, such as tire or wheel repair/replacement, dent removal, windshield repair or replacement, and replacement of a key or key-fob if it becomes inoperable due to the road hazard, plus other commissioner-approved services. The bill also reinforces that service contracts are not insurance, while remaining regulated under the Department of Insurance, and states when the act becomes effective.

Who It Affects
Consumers who buy service contracts for their vehicles will have explicit coverage for road-hazard-related damages (e.g., tires, wheels, dents, windshields, and keys) as defined by the bill.
Service contract providers/administrators (and related insurers) will need to comply with the new road-hazard definitions and coverage requirements and may offer or adjust services as approved by the commissioner.

Key Provisions
Defines 'Road Hazard' as a hazard encountered while driving a motor vehicle, including potholes, rocks, wood debris, metal parts, glass, plastic, curbs, or composite scraps.
Specifies damages caused by a road hazard that would be covered by a service contract, including repair/replacement of tires or wheels, removal of dents via paintless dent removal, repair or replacement of windshields due to road-hazard damage (to the extent related to the vehicle owner's insurance coverage), and replacement of a motor vehicle key or key-fob if it becomes inoperable, lost, or stolen, plus other commissioner-approved services.
Affirms that service contracts are not insurance, but are regulated for compliance with the chapter, and that service contract providers may utilize reimbursement mechanisms as defined.
Effective date: becomes effective on the first day of the third month after passage and governor’s approval.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.
Subjects: Insurance Department