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ICOBS 6A.1 1Guaranteed asset protection (GAP) contracts



1This section applies to a firm which sells a GAP contract to a customer in connection with the sale of a vehicle by:

  1. (1)

    the firm; or

  2. (2)

    a person connected to the firm.


1There is a sufficient connection between the GAP contract and the sale of a vehicle if the GAP contract is sold in connection with other goods and services, for example a credit agreement.


1A person connected with a firm includes acting as an introducer or appointed representative for that firm or if, regardless of authorisation status, it has a relevant business relationship with the firm.

Ensuring the customer can make an informed decision

  1. (1)

    1Before a GAP contract is concluded, a firm must give the customer the following information:

    1. (a)

      the total premium of the GAP contract, separate from any other prices;

    2. (b)

      the significant features and benefits, significant and unusual exclusions or limitations, and cross-references to the relevant policy document provisions;

    3. (c)

      whether or not the GAP contract is sold in connection with vehicle finance, that GAP contracts are sold by other distributors;

    4. (d)

      the duration of the policy;

    5. (e)

      whether the GAP contract is optional or compulsory;

    6. (f)

      when the GAP contract can be concluded by the firm, as described in ICOBS 6A.1.6R and ICOBS 6A.1.7R; and

    7. (g)

      the date the information in (a) to (f) is provided to the customer.

  2. (2)

    This information must be communicated in a clear and accurate manner and on paper2 or another durable medium in accordance with ICOBS 4.1A2.

  3. (3)

    This information must be drawn to the customer’s attention and must be clearly identifiable as key information that the customer should read.


1A firm must also comply with the rules in ICOBS 6 (Product Information).

Deferred opt-in for GAP contracts


1Except as specified in ICOBS 6A.1.7R, a GAP contract cannot be concluded by a firm until at least 2 clear days have passed since the firm complied with ICOBS 6A.1.4R.


1A firm can conclude a GAP contract the day after providing the information in ICOBS 6A.1.4R to a customer if the customer:

  1. (1)

    initiates the conclusion of the GAP contract; and

  2. (2)

    consents to the firm concluding the GAP contract earlier than provided for in ICOBS 6A.1.6R, and confirms that they understand the restriction in ICOBS 6A.1.6R.


1Before concluding a GAP contract, a firm should have regard to the information needs of its customers and consider whether it would be in the customer’s interest to receive the information in ICOBS 6A.1.4R again, for example, if a long time has passed between providing the information and the conclusion of the contract.