(a) Insurance for Creditors. - Creditors may insure guaranteed asset protection waiver obligations under a contractual liability policy or other similar policy issued by an insurer but shall not be required to do so.
(b) Required Terms. - Contractual liability or other insurance policies insuring guaranteed asset protection waivers shall include terms that do all of the following:
(1) Obligate the insurer to reimburse or pay to the creditor any sums the creditor is legally obligated to waive under guaranteed asset protection waivers issued by the creditor and purchased or held by the borrower.
(2) Provide that the policy covers any subsequent assignee upon the assignment, sale, or transfer of the vehicle finance agreement.
(3) Provide that the policy remains in effect unless cancelled or terminated in compliance with applicable insurance laws of this State.
(4) Provide that the cancellation or termination of policy shall not reduce the insurer's responsibility for guaranteed asset protection waivers issued by the creditor prior to the date of cancellation or termination and for which premiums have been received by the insurer.
(c) Administrators May Procure Insurance. - An insurance policy obtained pursuant to this section may be directly obtained by a creditor or may be procured by an administrator to cover the creditor's obligations. (2013-193, s. 1.)
Last modified: March 23, 2014