The Office of General Counsel issued the following informal opinion on October 1, 2003, representing the position of the New York State Insurance Department.
Re: Service Contracts with Minors
May a minor enter into a service contract in New York State?
If the service contract provider is registered and approved by the superintendent of insurance, a minor may enter into a service contract with the service contract provider that is voidable by the minor.
Your inquiry generally requests whether a minor can enter into a service contract and does not relate to any specific circumstances or set of facts.
The contracts of minors or infants are not void, but voidable at the infants election. 66 N.Y. Jur. 2d § 7 (2000). While contracts made by an infant are ordinarily voidable at his or her election, contracts for necessities are excepted from this rule. In an action against an infant upon a contract made by the infant allegedly for necessities, the burden is upon the plaintiff to show that what he or she agreed to provide to the infant was a necessity. 66 N.Y. Jur. 2d § 20 (2000).
N.Y. Ins. Law § 7907 (McKinney 2003) provides that, no person shall act as a provider of service contracts under article 79 without first having obtained an approval of a registration to do so from the superintendent. Article 79 contains all of the requirements and conditions for doing business as a service contract provider.
Therefore, a minor/infant may enter into a service contract with a service contract provider whose registration has been approved by the superintendent of insurance. The minor/infant may avoid or disaffirm the contract if the services contracted for are not necessities.
For further information you may contact Special Counsel Athan Shinas at the Albany Office.