2023 New York Laws › PEP - Personal Property › Article 9 - Motor Vehicle Retail Instalment Sales Act › 302A - Total Loss Notice and Waiver of the Gap Amount.

§  302A.  Total  loss  notice  and waiver of the gap amount. 1. If the
  retail instalment contract provides that the buyer shall be  responsible
  upon  a  total loss of the vehicle occasioned by its theft, confiscation
  or physical damage for the gap amount as defined in paragraph  fifty-two
  of subsection (a) of section one hundred seven of the insurance law, the
  holder,  prior  to the execution of the contract, shall by a notice on a
  separate document conspicuously disclose that fact and  the  obligations
  for  which  the  buyer  would  remain  liable  in  the event of a theft,
  confiscation or total loss of the vehicle. If  the  holder  is  required
  under  subdivision two of this section to offer to waive its contractual
  right to hold the buyer liable for the gap amount  in  the  event  of  a
  total  loss  of  the vehicle occasioned by its theft or physical damage,
  the notice shall also: (a) state that for a separate charge disclosed in
  the notice the holder will waive its contractual right to hold the buyer
  liable for the gap amount in the event of a total loss  of  the  vehicle
  occasioned  by  its  theft  or  physical damage; (b) contain a provision
  informing the buyer that he or she may, as an alternative to  purchasing
  a  waiver, be able to purchase insurance covering the gap amount from an
  insurance company which has  been  licensed  by  the  superintendent  of
  financial  services  to write motor vehicle debtor gap insurance in this
  state; and (c) contain a provision  permitting  the  buyer  to  indicate
  whether  he  or  she  wants the holder to waive its contractual right to
  hold the buyer liable for the gap amount in the event of a total loss of
  the vehicle occasioned by its theft or physical damage. The notice shall
  be signed by the buyer. The holder shall provide a copy  of  the  signed
  notice  to the buyer and shall maintain a copy in the holder's files for
  at least the term of the contract. Failure to provide the notice and  to
  obtain  the  buyer's  signature  as  required  by this subdivision shall
  invalidate any provision of the agreement which otherwise would obligate
  a buyer to pay to the holder, after a total loss of  the  motor  vehicle
  occasioned  by  its  theft,  confiscation  or  physical  damage, the gap
  amount. No retail installment contract shall  be  conditioned  upon  the
  buyer's  obtaining of motor vehicle debtor gap insurance as set forth in
  subparagraph (B) of paragraph twenty-six of subsection  (a)  of  section
  one thousand one hundred thirteen of the insurance law.
2.  If the retail instalment contract provides that the buyer shall be
  responsible upon a total loss of the vehicle occasioned by its theft  or
  physical  damage  for the gap amount, the holder, prior to the execution
  of the agreement, shall offer to waive its contractual right to hold the
  buyer liable for the gap amount in the event of  a  total  loss  of  the
  vehicle  occasioned  by  its  theft  or  physical  damage, only if motor
  vehicle creditor gap insurance coverage is available to the  holder  and
  such  coverage  is  obtained from a property/casualty insurance company,
  which has been licensed by the superintendent of financial  services  of
  this  state to write motor vehicle creditor gap insurance in this state.
  This offer may be made contingent upon the payment by  the  buyer  of  a
  separate charge that shall not exceed the cost of motor vehicle creditor
  gap insurance covering the retail instalment contract. Nothing contained
  in  this section shall be construed to authorize a waiver, in connection
  with a transaction with respect to  which  motor  vehicle  creditor  gap
  insurance  has  not  been  obtained,  of a contractual right to hold the
  buyer liable for the gap amount in the event of  a  total  loss  of  the
  vehicle occasioned by its theft or physical damage.
3.  A  holder  shall  not  be  obligated under subdivision two of this
  section to offer to waive its contractual right to hold the buyer liable
  for the gap amount if, during the current calendar year  or  during  the
  odd-numbered  calendar  year  immediately preceding the calendar year in
  which the agreement is entered  into,  the  holder  has  received  motor

  vehicle  creditor gap insurance declination notices or other evidence of
  unavailability from every insurance company whose name  appears  on  the
  department  of  financial  services  compilation  of insurance companies
  which  during  that calendar year were authorized to write motor vehicle
  creditor gap insurance in this state.  Evidence  of  these  declinations
  shall  be retained by such a holder of such a holder for a period of six
  years after the expiration of the  calendar  year  in  which  they  were
  issued.
4. In order to enable holders or their anticipated assignees to comply
  with  the  requirements  imposed by subdivision two of this section, the
  superintendent of financial services shall compile and make available  a
  periodically  updated  list  of  those  insurance  companies  which  are
  authorized to write motor vehicle creditor  gap  insurance  coverage  in
  this state.
5.  Nothing in this section shall be construed to apply to the holder,
  under a retail instalment contract under which the buyer is  not  liable
  upon  a  total loss of the vehicle occasioned by its theft, confiscation
  or physical damage for the gap amount.