Legal information only, not legal advice. Statutes are summarized from the sources listed below, and some mirrors may not show the latest text.
What State Refund Rules Look Like
The states we could source follow a similar shape: a short window for a full refund, a prorated refund of the unused term afterward, a cap or limit on the cancellation fee, and a deduction for claims the company already paid. The details differ, and several states say nothing we could find, so the contract and your state's rule together decide your refund.
Florida - Florida Statutes section 634.312
A buyer may cancel a home warranty within 10 days of purchase for 100 percent of the gross premium less claims paid, and the company may charge an administrative fee of up to 5 percent. After 10 days, a holder who cancels gets 90 percent of the unearned pro rata premium less claims paid. If the company cancels for a reason other than fraud or misrepresentation, the refund is 100 percent of the unearned pro rata premium less claims paid.
Texas - Occupations Code sections 1304.1581 and 1304.159
A holder who cancels in the first 30 days gets the full price back less claims paid, with no cancellation fee. From day 31, the provider must refund the unused portion less claims paid and may keep a cancellation fee of up to $50. If the refund is not paid by the 46th day after the provider receives the notice, a penalty of 10 percent per month applies. When the provider cancels, it must mail written notice at least five days ahead giving the reason (with exceptions such as nonpayment or fraud), refund the unused portion and may not charge a cancellation fee.
Illinois - Service Contract Act, 215 ILCS 152/35
The contract must state that the holder can cancel, and the provider may keep a cancellation fee of the lesser of 10 percent of the price or $50. Cancelling within 30 days of purchase with no service provided gets a full refund less the fee. After that, the holder gets a pro rata refund for the unexpired term less the value of any service received and the fee. This is the version effective January 1, 2018; confirm the current text.
Nevada - NRS 690C.250 and NAC 690C.120
A service contract is void and the price refundable if the original purchaser has made no claim and returns it within 20 days of the provider mailing it, 10 days of receipt when handed over at purchase, or any longer period the contract sets. The refund is due within 45 days of the return, with a penalty of 10 percent of the price for each 30-day period it is late. A provider that cancels must refund the unearned portion and may not charge a fee.
Maryland - Service Contracts and Consumer Products Guaranty Act
According to the Maryland Department of Labor, a buyer can cancel within 20 days of receiving the contract and gets a full refund within 45 days if no claim was made.
New Mexico - Service Contract Regulation Act (2001 enacted bill)
A service contract is void, and the provider must refund the purchase price, if the holder has made no claim and returns the contract.
California - Insurance Code section 12764
A home protection contract generally cannot be cancelled by the company during its initial term except for nonpayment, fraud or material misrepresentation, or coverage that began before a home sale that then does not close. We could not confirm California's rules on a buyer's refund from the sources we found.
How a Prorated Refund Works
This is an illustrative calculation, not any company's actual terms. A prorated refund returns the unused part of the price, then subtracts any allowed fee and claims paid.
Example: annual contract, cancelled after 7 months
- Annual price paid
- $720
- Unused portion (5 of 12 months)
- $300
- Cancellation fee (if the contract and state allow one)
- - $50
- Claims paid, if the state allows a deduction
- - $0 in this example
- Refund
- $250
If you pay monthly, cancelling stops future billing, and past months are not refunded unless a state rule or the contract says so.
The Claims Deduction
Several of the sourced rules subtract claims already paid from the refund: Florida and Texas say so directly, Illinois subtracts the value of service received, and the Texas Attorney General concluded in Opinion KP-0024 that the Texas statute does not allow a refund that ignores paid claims. In practice, cancelling right after a large repair can shrink the refund, or leave it at zero. Read the cancellation section of your contract, and check your state's rule, before you cancel after a major claim.
We do not list which companies deduct claims, because that is a contract term that can change between plans and years. Download the sample contract for your plan and read the cancellation clause before you buy.
When the Company Cancels You
Texas requires a written notice with the reason at least five days ahead, except for nonpayment, fraud or a substantial breach by the holder, and a refund of the unused portion with no cancellation fee. Florida's refund when the company cancels for a reason other than fraud is 100 percent of the unearned pro rata premium less claims paid. California limits the reasons a company can cancel during the initial term. If a company cancels without the notice or refund your state's rule describes, that is a matter for your state regulator.
How to Cancel and Protect Your Refund
- 1 Check your claims status. If you have an approved or pending claim, read how your contract and state law treat claims already paid before you cancel.
- 2 Cancel in writing. Email or certified mail creates a paper trail. Record the date you sent it.
- 3 Ask for written confirmation. Request confirmation of the cancellation and how the refund was calculated.
- 4 Check the free window. Your state or contract may give a short window for a full refund. The state rules above show examples; the contract controls where it is more generous.
- 5 Time it against renewal. Cancelling before the renewal deadline avoids a new term and a mid-term refund dispute. See the auto-renewal page for the deadline rules.
- 6 Track the refund. Some statutes set a deadline for the refund. If it does not arrive, follow up in writing and escalate to your state regulator.