(815 ILCS 636/20)
Sec. 20.
Total loss notice and waiver of the gap amount.
(a) If the consumer lease provides that the lessee shall be
responsible for the gap amount, the consumer lease shall disclose that fact and
disclose the obligations for which the lessee would remain liable in the event
of a total loss of the vehicle prior to the end of the lease term occasioned by
its theft, physical damage, or other occurrence as specified in the consumer
lease, using the term "gap amount".
(b) The lessor may waive its contractual right to hold the lessee
liable for some or all of the gap amount. This waiver may be granted either
without a separate charge to the lessee, or in exchange for the payment by the
lessee of a separate charge. Any separate charge for the waiver must be
conspicuously disclosed to the lessee.
(c) If the lessor under subsection (b) of this Section offers for a
separately stated charge to waive its contractual right to hold the lessee
liable for the gap amount, the lease shall also contain a conspicuous notice
which shall (1) state that for a separate charge disclosed in the notice the
lessor will waive its contractual right to hold the lessee liable for the gap
amount and (2) state that the lessee may as an alternative to purchasing a
waiver,
be able to purchase protection covering the gap amount from a company which has
been authorized to do business in this State. Failure to provide the notice as
required by this subsection shall invalidate any lease provision which
otherwise would obligate a lessee to pay to the holder or lessor, after a total
loss of
the vehicle occasioned by its theft, physical damage or other occurrence as
specified in the consumer lease, any of the items specified in paragraphs (5)
and (6) of subsection (b) of Section 45 of this Act. No consumer lease
shall be conditioned upon the lessee obtaining vehicle lessee gap
protection.
(d) The lessor's waiver of its contractual right to hold the lessee
liable for the gap amount may be conditioned upon the receipt by the lessor of
(1) all amounts due under the consumer lease as of the date of receipt by the
lessor of the insurance proceeds or equivalent amount as specified in the
lease or if no such date is specified, as of the date of total loss of the
vehicle, (2) an amount from the lessee equal to the amount of the lessee's
deductible and any other subtractions from the actual cash value under the
lessee's insurance policy, and (3) insurance proceeds from the insurance
policy required under the lease or the equivalent amount of the value of the
vehicle.
(e) No insurance or other additional license shall be required of lessors
who waive or offer to
waive their contractual right to hold the lessee liable for the gap amount.
(Source: P.A. 89-625, eff. 1-1-97.)
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