Is an all-terrain vehicle (“ATV”) a motor vehicle? In the most literal sense the answer is “yes,” but in the context of ATV service contracts the best answer is “it depends.”
In some states the term “motor vehicle” is defined to expressly include ATVs (e.g., California and Colorado). Other states take the opposite approach and expressly exclude ATVs from the definition of “motor vehicle” (e.g. Nebraska). In some states, it may depend on who is using the ATV or how it is used—that is to say, in a single state it is possible for the same model of ATV to be considered a motor vehicle in one situation but not in another (e.g., Maine and North Dakota). To further complicate matters, based on some states’ definitions of “motor vehicle,” one model of ATV may be regulated as a motor vehicle while another may not fit within that definition.
So, why does this matter? Because, in many states, motor vehicle service contracts are regulated differently from those covering consumer goods. Providers of these contracts may be subject to different financial responsibility and registration requirements, and the contracts may be subject to different filing and disclosure requirements. There also may be exemptions available in one law that is not available, or may be less favorable, in the other—this is particularly significant for manufacturers of ATVs, or their affiliates, that offer service contracts. In some cases, the contracts are even under the jurisdiction of different state agencies—for example, in Idaho, service contracts on motorcycles would be regulated as motor vehicle service contracts under the Attorney General’s enforcement authority, whereas ATVs would likely be exempt from regulation as consumer good service contracts under the purview of the Department of Insurance. As an interesting aside, Florida actually includes watercraft within the term “motor vehicle” for purposes of the motor vehicle service agreement law, but not ATVs. Considering this, it is perfectly conceivable that a well-meaning provider of ATV service contracts may be violating a given state’s service contract laws simply by complying with the wrong law.
This distinction is particularly important for a company providing service contracts that cover both motorcycles and ATVs—in most states, motorcycles fit the definition of “motor vehicle,” while ATVs may not. Thus, in some states, such a company may find it necessary to maintain to two different licenses to provide a single contract to all of its customers.
Therefore, when providing ATV service contracts, it is important for one to consider the patchwork of regulations that may apply, specifically noting which states regulate motor vehicle and consumer goods service contracts differently and determining into which category a particular ATV falls.