The following definitions are for purposes of this chapter and are not intended to provide actual terms required in GAP waivers:

(1) “Administrator” means a person, other than an insurer or creditor, that performs administrative or operational functions pursuant to the GAP waiver program;

Terms Used In Tennessee Code 56-59-102

  • Commissioner: means the commissioner of commerce and insurance. See Tennessee Code 56-1-102
  • Contract: A legal written agreement that becomes binding when signed.
  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
  • Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
  • Person: means any association, aggregate of individuals, business, company, corporation, individual, joint-stock company, Lloyds-type organization, organization, partnership, receiver, reciprocal or interinsurance exchange, trustee or society. See Tennessee Code 56-16-102
  • State: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
(2) “Borrower” means a debtor, retail buyer or lessee under a finance agreement;
(3) “Commissioner” means the commissioner of commerce and insurance;
(4) “Creditor” means:

(A) The lender in a loan or credit transaction;
(B) The lessor in a lease transaction;
(C) Any motor vehicle dealer as defined in § 55-17-102;
(D) The seller in commercial retail installment transactions; or
(E) The assignees of any of subdivisions (4)(A)-(D) to whom the credit obligation is payable;
(5) “Finance agreement” means a loan, lease or retail installment sales contract for the purchase of a motor vehicle;
(6) “Free look period” means the period of time from the effective date of the GAP waiver until the date the borrower may cancel the contract without penalty, fees or costs to the borrower. This period of time shall not be shorter than thirty (30) days;
(7) “Guaranteed asset protection waiver” or “GAP waiver” means a contractual agreement wherein a creditor agrees for a separate charge to cancel or waive all or part of amounts due on a borrower’s finance agreement in the event of a total physical damage loss or unrecovered theft of a motor vehicle, which agreement must be part of, or a separate addendum to, the finance agreement;
(8) “Insurer” means an insurance company licensed, registered, or otherwise authorized to do business under the laws of this state, including surplus lines insurers;
(9) “Motor vehicle” means self propelled or towed vehicles designed for personal or commercial use, including, but not limited to, automobiles, trucks, motorcycles, recreational vehicles, all terrain vehicles, campers, boats, personal watercraft, and motorcycle, boat, camper and personal watercraft trailers;
(10) “Person” includes an individual, company, association, organization, partnership, business trust, corporation, and every form of legal entity;
(11) “Related finance company” means a finance company that has common ownership of fifty percent (50%) or more with the retail seller;
(12) “Retail buyer” means a person who buys motor vehicles not principally for the purpose of resale; and
(13) “Retail seller” means a person that is regularly engaged in the selling of motor vehicles to a retail buyer and that holds any necessary license or licenses to sell to a retail buyer.
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