CT HB05385

Creates regulatory framework for guaranteed asset protection (GAP) waivers in Connecticut, effective January 1, 2023, covering motor vehicle loans and leases.

Exempts GAP waivers from insurance licensing requirements if they comply with this law, though backup insurance policies insuring the waivers themselves remain subject to insurance regulations.

Requires all GAP waivers to include a 30-day free look period allowing borrowers to cancel and receive full refunds, plus allows post-period cancellation with pro-rata refunds if notice is provided within 90 days.

Mandates clear disclosures to borrowers including creditor/administrator names, purchase price, waiver terms, benefit application procedures, refund calculations, and statement that purchase cannot be required as a credit condition.

Prohibits creditors from requiring GAP waiver purchase as a condition of credit or making any credit terms conditional on waiver purchase; motor vehicle dealers must insure their GAP obligations while other creditors may optionally do so.