Under Florida law, the holder of a motor vehicle service agreement cancels it 30 days after buying it, and no claims have been paid. The refund must be:

Question

Accepted Answer

100 percent of the gross premium paid, less any reasonable administrative fee of no more than 5 percent of that premium

A Florida motor vehicle service agreement indemnifies the holder against 'loss caused by failure of any mechanical or other component part' (§634.011(8)). §634.121(3)(a): 'Each service agreement must contain a cancellation provision. Any service agreement is cancelable by the purchaser within 60 days after purchase. The refund must be 100 percent of the gross premium paid, less any claims paid on the agreement. A reasonable administrative fee may be charged not to exceed 5 percent of the gross premium paid by the agreement holder.' After 60 days, a cancellation by the holder returns 'not less than 90 percent of the unearned pro rata premium, less any claims paid on the agreement' (§634.121(3)(b)).

Source: Fla. Stat. §§634.011(8), 634.121(3)(a)–(b) (2026)