Legal information only, not legal advice. Statutes are summarized from the sources listed below; read the current text or ask a licensed attorney before you rely on a detail.
How Auto-Renewal Works in a Home Warranty
Auto-renewal means the contract continues for another term unless you cancel before the deadline. The contract you signed describes the renewal term, the renewal price and how to cancel, so the contract is the first document to read. State law then limits how a seller may disclose the renewal, obtain consent and handle cancellation.
- Find the renewal date and cancellation deadline in your contract or online account.
- Note the renewal price, which can differ from your first-term price.
- Cancel in writing before the deadline if you do not want to renew.
State Auto-Renewal Laws We Could Source
These laws cover automatic renewals broadly, not only home warranties. Whether a given home warranty contract falls inside a statute depends on its wording, so treat each entry as a starting point.
California - Business and Professions Code section 17602
A business must present automatic renewal terms clearly and conspicuously, get the consumer's affirmative consent before charging, and send an acknowledgment that includes the renewal terms and cancellation policy. A consumer who signs up online must be able to cancel online.
New York - General Obligations Law section 5-903
An automatic renewal clause in a service, maintenance or repair contract for real or personal property is unenforceable against the customer unless the provider sends written notice, served personally or by certified mail, at least 15 and no more than 30 days before the customer's deadline to give notice of non-renewal. The statute does not apply where the renewal period is one month or less.
Illinois - Automatic Contract Renewal Act (815 ILCS 601)
As amended by Public Act 103-0919, the seller must present the renewal terms clearly and conspicuously before the purchase, get consent before charging and provide an acknowledgment of the terms. An older version of the Act required written notice 30 to 60 days before the cancellation deadline for contracts of 12 months or more. Confirm which version applied when you signed.
Delaware - Title 6, Chapter 27, Subchapter IV
The subchapter defines an automatic renewal provision as one that renews a contract for more than one month and keeps it in effect more than 12 months after it began. Failing to offer a cost-effective, timely and easy-to-use way to cancel is a deceptive practice, and a consumer who contracts online must be able to cancel online. A 2021 law (Senate Bill 93) requires sellers to notify consumers about an upcoming renewal; we could not confirm the notice timing.
Oregon - ORS 646A.293 to 646A.295
A seller of an automatic renewal or continuous service offer may not hide the renewal terms from the consent request, charge a card without affirmative consent, or omit a cost-effective, timely and easy-to-use way to cancel, which the acknowledgment must describe. Material changes require a clear notice with cancellation information. The text we reviewed is the 2011 version, so confirm the current statute.
Virginia - Virginia Code section 59.1-207.46
The seller must present renewal terms clearly and conspicuously before the consumer is bound, get affirmative consent before charging, and provide a retainable acknowledgment of the renewal terms, cancellation policy and how to cancel. A renewal notice must say that the offer renews unless cancelled, the cancellation deadline and the cancellation method.
A state without a dedicated renewal statute may still apply its consumer protection law to a renewal that was not clearly disclosed. We did not find a renewal rule written specifically for home warranties in any state.
Rate Increases at Renewal
A renewal price that is higher than the first-term price is not unlawful by itself when the contract disclosed it. The question is whether the original offer made clear that the first-term price applied only to the first term. If it did not, you may have grounds to dispute the increase under your state's consumer protection law, so keep the original offer, the confirmation and the renewal notice.
Before you cancel over a price increase, ask whether a lower renewal rate is available. The company may say no, and asking costs nothing.
What to Do If You Were Charged Without Adequate Notice
- 1
Review your contract
Find the renewal clause, the renewal date, the cancellation method and what notice the company says it sent.
- 2
Check every email account
Renewal notices often arrive by email. Look in spam folders and any other address tied to the account before you dispute.
- 3
Ask for a refund in writing
State the date you were charged, say you want to cancel and ask for a refund, citing the notice rules of your state if one applies. Keep a copy.
- 4
Dispute the charge with your card issuer
If the company refuses and you believe the renewal was not properly disclosed, ask your card issuer about a dispute. Describe the facts and attach your contract.
- 5
File a regulator complaint
Your state insurance department or attorney general's consumer protection office may take the complaint. The state laws table names the agency our sources point to for your state.
How to Cancel Before the Contract Renews
- Put the cancellation deadline on your calendar with a reminder well ahead of it.
- Use the method your contract names, such as an online account, phone or mail, and keep proof. In California and Delaware, a contract signed online must allow online cancellation.
- Ask for written confirmation of the cancellation and the refund amount, and save a screenshot or email.
Cancellation and refund rules after the contract starts are on the refund rights page.