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Minnesota attorney general sues Texas company for deceptive warranty sales

April 6, 2018 GMT

Five years after Sharon Halverson bought a 2012 Kia Sorrento, she received an official-looking letter that said the warranty on it had expired. So she ponied up $3,433 for what she thought was a full warranty.

Halverson, a retiree in Blaine, didnt realize the offer wasnt from the dealer nor that her cars warranty was still good.

Shes not the only Minnesotan who thinks she was duped. On Friday, Minnesota Attorney General Lori Swanson filed a lawsuit against AutoAssure LLC alleging the company sold costly and often unnecessary car warranties to nearly 1,000 Minnesotans.

AutoAssures letters, which to appeared to come from a company affiliated with the cars manufacturer, also falsely appeared to offer comprehensive coverage, Swanson said.

These contracts are expensive and may contain dozens of exclusions for everything from mechanical problems resulting from normal operation of the car to a list of non-covered parts, she said.

The lawsuit was filed in Hennepin County and seeks injunctive and monetary relief. Representatives for AutoAssure, based in Plano, Texas, didnt immediately return requests for comment.

The suit says that Halverson and others received mailings sent from a vehicle services department. Recipients were told the manufacturers warranty was about to expire and call AutoAssure to update their repair coverage with contracts that cost on $3,200 on average.

The so-called policies included a staggering number of exclusions. It was supposed to cover everything, Halvorson said.

In some cases the letters claimed the existing manufacturers warranty was being extended, or that a service contract was being reactivated, according to Swansons office.

Halversons car was still covered by its basic warranty for another five months and by its powertrain warranty for many more years. A 59-year-old woman from Cambridge said she received a letter she thought was from Ford. AutoAssure sold her a contract for $3,791 even though she still had another 18 months left on an existing service contract.

In some cases, recipients thought the contract they were buying covered everything, but in reality some policies contained more than 40 paragraphs of exclusions. Halverson said that shes yet to receive a penny.

They said, Send in the info and let us see, Halverson said. So I sent it in and so far havent received any compensation.

Jim Buchta 612-673-7376