Under the Act, the company issuing the warranty must fully and conspicuously disclose, in simple and readily understood language, all the terms and conditions to meet the requirements set out by the Federal Trade Commission.

Any ambiguous or difficult to understand statements are held against the provider of the warranty, who is usually then found to be liable for the problem.

Furthermore, under “tie-in sales” provisions, issuers cannot demand that only branded parts be used with the product in order to maintain the validity of the warranty. This ensures consumers can take advantage of trade competition and are not forced to pay over the odds for certain things related to their original purchase.