The Florida Senate
BILL ANALYSIS AND FISCAL IMPACT STATEMENT
(This document is based on the provisions contained in the legislation as of the latest date listed below.)
Prepared By: The Professional Staff of the Committee on Fiscal Policy
BILL: CS/CS/SB 902
INTRODUCER: Commerce and Tourism Committee; Banking and Insurance Committee; and Senator
Boyd
SUBJECT: Motor Vehicle Retail Financial Agreements
DATE: February 13, 2024 REVISED:
ANALYST STAFF DIRECTOR REFERENCE ACTION
1. Moody Knudson BI Fav/CS
2. McKay McKay CM Fav/CS
3. Moody Yeatman FP Favorable
Please see Section IX. for Additional Information:
COMMITTEE SUBSTITUTE - Substantial Changes
I. Summary:
CS/CS/SB 902 substantially adopts portions of the Products Model Act by the Guarantee Asset
Protection Alliance relating to vehicle value protection agreements, excess wear and use waivers,
and guaranteed asset protection products.
Vehicle Value Protection Agreements
The bill creates the “Florida Vehicle Value Protection Agreements Act” (the “Florida Act”),
which includes:
 Definitions of the terms: administrator, commercial transaction, consumer, contract holder,
finance agreement, free look period, motor vehicle, provider, and vehicle value protection
agreement.
o A “vehicle value protection agreement” is a contractual agreement that provides a benefit
toward either the reduction of some or all of the contract holder’s current finance
agreement deficiency balance, or the purchase or lease of a replacement motor vehicle
upon the occurrence of an adverse event to the vehicle. The term does not include
guaranteed asset protection products, and the product is not insurance.
 Requirements for offering vehicle value protection agreements (“VVPAs”), including
provisions regarding restricting the type of charges, prohibiting certain conditional sales,
utilizing an administrator, providing a copy of the agreement, prohibiting sales with
duplicative coverage, and providing for financial security requirements;
BILL: CS/CS/SB 902 Page 2
 The nature, extent and type of disclosures required in VVPAs;
 Penalties for violating the Florida Act, which include noncriminal violations punishable by a
fine per violation or in the aggregate for all “violations of a similar nature,” which is defined
in the bill; and
 Exemption of VVPAs offered in connection with a commercial transaction from the
disclosure and penalty provisions of the Florida Act.
Excess Wear and Use Waivers
The bill authorizes a retail lessee to contract with a retail lessor for an “excess wear and use
waiver,” which is an agreement wherein the lessor agrees to cancel all or part of amounts that
may become due under the lease because of excessive wear and use of a motor vehicle. The bill
also prohibits the terms of the related motor vehicle lease from being conditioned upon the
consumer’s payment for any excess wear and use wavier, except such waiver may be discounted
or given at no charge for the purchase of other noncredit-related goods. A lease agreement that
includes an excess wear and use waiver must contain certain disclosures. An excess wear and use
waiver is not insurance for purposes of the Florida Insurance Code.
Guaranteed Asset Protection Products
The bill amends the definition of “guaranteed asset protection product” (“GAP product”), which
is an agreement by which a creditor agrees to waive a customer’s liability for any debt that
exceed the value of the collateral, to specify that a GAP product:
 May be with or without a separate charge;
 May cancel, rather than just waive, the customer’s liability;
 Applies when a motor vehicle incurs total physical damage or is subject to an unrecovered
theft; and
 May provide for a benefit that waives a portion of, or provides a customer with a credit
toward, the purchase of a replacement vehicle.
The bill also amends the provisions regarding GAP products to:
 Provide for the refund of all unearned portions of the purchase price of a contract for a GAP
product if the contract is terminated, unless the contract provides otherwise;
 Prohibit an entity from deducting more than $75 in administrative fees from a refund;
 Provide that a GAP product may be cancelable or noncancelable after a “free-look period”
defined in the bill; and
 Provide that if a termination of a GAP product occurs for a specified reason, the entity may
pay any refund directly to the holder or administrator, and deduct the refund amount from the
amount owed under the retail installment contract except if such contract has been paid in
full.
The bill has an effective date of October 1, 2024.
BILL: CS/CS/SB 902 Page 3
II. Present Situation:
Florida Motor Vehicle Sales Finance Laws
The Florida Motor Vehicle Retail Sales Finance Act1 regulates sellers,2 commonly referred to as
auto dealers, who enter into retail installment contracts3 with buyers4 for the purchase or lease of
a motor vehicle.5 Except for certain businesses, such as banks or trust companies, sellers are
required to obtain a license to operate in Florida.6 A seller must submit an application, specified
information, and a nonrefundable fee to the Office of Financial Regulation (OFR) to obtain the
required license.7
Any person who willfully and intentionally violates any provision of s. 520.995, F.S., or engages
in the business of a retail installment seller without a license is guilty of a misdemeanor of the
first degree. Section 520.995, F.S., provides grounds for disciplinary action by the OFR when,
for instance, there is failure to comply with any provision of ch. 520, F.S. Further, the OFR has
authority to issue and serve upon any person a cease and desist order whenever such person is
violating, has violated, or is about to violate any provision of ch. 520, F.S.,8 or may impose an
administrative fine not to exceed $1,000 for each violation that has occurred.9
Retail installment contracts must comply with several requirements and prohibitions, including,
but not limited to, that the agreement must:
 Be in writing;10
 Contain a “Notice to the Buyer” which includes specified information;11 and
 Contain other specified information, including the amount financed, finance charges, total
amount of payments, total sale price, and payment details.12
Sellers must provide buyers with a separate written itemization of the amount financed. 13 Florida
law contains several other provisions to protect the buyer, such as regulation on insurance rates,
1
Sections 520.01-520.10, 520.12, 520.125, and 520.13, F.S.
2
Section 520.02(11), F.S., defines “motor vehicle retail installment seller” or “seller” as a person engaged in the business of
selling motor vehicles to retail buyers in retail installment transactions.
3
“Retail installment contract” or “contract” is defined as an agreement, entered into in this state, pursuant to which the title
to, or a lien upon the motor vehicle, which is the subject matter of a retail installment transaction, is retained or taken by a
seller from a retail buyer as security, in whole or in part, for the buyer’s obligation. The term includes a conditional sales
contract and a contract for the bailment or leasing of a motor vehicle by which the bailee or lessee contracts to pay as
compensation for its use a sum substantially equivalent to or in excess of its value and by which it is agreed that the bailee or
lessee is bound to become, or for no further or a merely nominal consideration, has the option of becoming, the owner of the
motor vehicle upon full compliance with the provisions of the contract. Section 520.02(17), F.S.
4
“Retail buyer” or “buyer” is defined as a person who buys a motor vehicle from a seller not principally for the purpose of
resale, and who executes a retail installment contract in connection therewith or a person who succeeds to the rights and
obligations of such person.
5
See Ch. 520, F.S.
6
Section 520.03(1), F.S.
7
Id.
8
Section 520.994(3), F.S.
9
Section 520.994(4), F.S.
10
Section 520.07(1)(a), F.S.
11
Section 520.07(1)(b), F.S.
12
Section 520.07(2), F.S.
13
Section 520.07(3), F.S.
BILL: CS/CS/SB 902 Page 4
refunds for unearned insurance premiums, limits on the amount of delinquency charges a
holder14 may charge, and restrictions on when a contract may be signed with blank spaces.15
In conjunction with entering into any new retail installment contract or contract for a loan, a
seller, a sales finance company,16 or a retail lessor,17 and any assignee of such an entity, may
offer an optional guaranteed asset protection product (“GAP product”) for a fee or otherwise.18
Florida law defines a “guaranteed asset protection product” as:
a loan, lease, or retail installment contract term, or modification or addendum to a
loan, lease, or retail installment contract, under which a creditor agrees to waive a
customer’s liability for payment of some or all of the amount by which the debt
exceeds the value of the collateral. Such a product is not insurance for purposes of
the Florida Insurance Code. This subsection also applies to all guaranteed asset
protection products issued before October 1, 2008.
A seller or any other authorized entity may not require the buyer to purchase a GAP product as a
condition for making the loan. In order to offer a GAP product, a seller or any other authorized
entity must comply with the following:19
 The cost of any GAP product must not exceed the amount of the loan indebtedness.
 Any contract or agreement pertaining to a GAP product must be governed by s. 520.07, F.S.,
relating to requirements and prohibitions as to retail installment contracts.
 A GAP product must remain the obligation of any person that purchases or otherwise
acquires the loan contract covering such product.
 An entity providing GAP products must provide readily understandable disclosures that
explain in detail eligibility requirements, conditions, refunds, and exclusions. The disclosures
must explain that the purchase of the GAP product is optional, and must meet certain criteria
regarding the language contained in it.
 An entity must provide a copy of the executed contract for the GAP product to the buyer.
 An entity may not offer a contract for a GAP product that contains terms giving the entity the
right to unilaterally modify the contract unless:
o The modification is favorable to the buyer and is made without any additional charge; or
o The buyer is notified of any proposed change and is provided a reasonable opportunity to
cancel the contract without penalty before the change goes in effect.
 If a contract for a GAP product is terminated, the entity must refund to the buyer any
unearned fees paid for the contract unless the contract provides otherwise. A customer who
receives the benefit of the GAP product is not entitled to a refund. The buyer must notify the
entity of the event terminating the contract and request a refund within 90 days after the
14
Section 520.02(8), F.S., provides that a “holder” of a retail installment contract means the retail seller of a motor vehicle
retail installment contract or an assignee of such contract.
15
Section 520.07, F.S.
16
Section 520.02(19), F.S., defines “sales finance company” as a person engaged in the business of purchasing retail
installment contracts from one or more sellers. The term includes, but is not limited to, a bank or trust company, if so
engaged. The term does not include the pledge of an aggregate number of such contracts to secure a bona fide loan thereon.
17
Section 521.003(8), F.S., defines “retail lessor” as a person who regularly engages in the business of selling or leasing
motor vehicles and who offers or arranges a lease agreement for a motor vehicle. The term includes an agent or affiliate who
acts on behalf of the retail lessor and excludes any assignee of the lease agreement.
18
Section 520.07(11), F.S.
19
Id.
BILL: CS/CS/SB 902 Page 5
terminating event. An entity may offer a buyer a nonrefundable contract for a GAP product
only if the entity also offers the buyer a bona fide option to purchase a comparable contract
that provides for a refund.
Ch. 520, F.S., does not contain any provisions on vehicle value protection agreements
(“VVPAs”) or excess wear and use waivers.
GAPA Products Model Act
The Guarantee Asset Protection Alliance (“GAPA”) is an organization composed of insurance
companies, lenders, and administrative services companies, and offers member benefits relating
to, amongst other things, legislative efforts regarding GAP waivers.20 On November 30, 2023,
GAPA approved the latest Products Model Act (the “Revised Model Act”) relating to motor
vehicle financial protection,21 such as VVPA and debt waivers.22 Debt waivers include GAP
products and excess wear and use waivers.23 The Model Act relates to the GAP waiver only. The
Revised Model Act, of which the bill adopts many portions, incorporates updated provisions on
GAP waivers, provisions covering excess wear and use waivers, and provisions on VVPAs.
According to GAPA, 15 states have enacted GAP waivers, 22 states have adopted the Model Act
(including Florida), and 4 states have adopted the Revised Model Act.24
III. Effect of Proposed Changes:
Florida Vehicle Value Protection Agreements Act
Section 3 of the bill provides that ss. 520.151, F.S., to 520.156, F.S., may be cited as the “Florida
Act.”
Section 4 of the bill defines, for purposes of the Florida Vehicle Value Protection Agreements
Act, the following terms:
 “Administrator” means the person who is responsible for the administrative or operational
function of managing vehicle value protection agreements, including, but not limited to, the
adjudication of claims or benefit requests by contract holders.
 “Commercial transaction” means a transaction in which the motor vehicle subject to the
transaction is used primarily for business or commercial purposes.
 “Contract holder” means a person who is the purchaser or holder of a vehicle value
protection agreement.
 “Finance agreement” means a loan, retail installment sales contract, or lease for the purchase,
refinancing, or lease of a motor vehicle.
20
The GAPA, Membership, available at: GAPA Membership Information (gapalliance.org) (last visited Jan. 29, 2024).
21
The GAPA, Motor Vehicle Financial Protection Products Model Act, Nov. 30, 2023, p. 2, available at: GAPA-Model-Act-
APPROVED-2023_11_30.pdf (gapalliance.org) (last visited Jan. 29, 2024) (hereinafter cited as the “Revised Model Act”).
The Revised Model Act defines “Motor Vehicle Financial Protection Products” as agreements defined herein that protect a
Consumer’s financial interest in their current or future motor vehicle and include but are not limited to debt waivers and
vehicle value protection agreements.
22
The Revised Model Act.
23
The Revised Model Act at p. 2-3.
24
The GAPA, Legislative Status of GAP Waiver, May 2023, available at: PowerPoint Presentation (gapalliance.org) (last
visited Jan. 29, 2024).
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 “Free-look period” means the period of time, commencing on the effective date of the
contract, during which the buyer may cancel the contract for a full refund of the purchase
price. This period may not be shorter than 30 days.
 “Motor vehicle” has the same meaning as provided in s. 520.02, F.S., which defines the term
as any device or vehicle, including automobiles, motorcycles, motor trucks, trailers, mobile
homes, and all other vehicles operated over the public highways and streets of this state and
propelled by power other than muscular power, but excluding traction engines, road rollers,
implements of husbandry and other agricultural equipment, and vehicles which run only
upon a track.
 “Provider” means a person that is obligated to provide a benefit under a VVPA. A provider
may function as an administrator or retain the services of a third-party administ