State Law Guide
If you paid off your loan early, you may be owed a GAP refund.
Maryland GAP Insurance Refund Guide
Under Maryland Consumer Protection Act and Retail Installment Sales Act (no GAP refund statute), Maryland consumers who pay off auto loans early are entitled to pro-rata GAP and warranty refunds. Dealers who fail to comply face Damages for injury or loss, with discretionary attorney's fees, if a refund refusal is an unfair, abusive or deceptive trade practice (Com. Law §§ 13-303, 13-408).
Quick Answer
In Maryland, you're entitled to a pro-rata refund of unused GAP insurance and warranty products when your loan is paid off early. You can sue in Small Claims Court for up to $5,000.
Paid off your auto loan early in Maryland?
Check your rights under Maryland law
Key Maryland Provisions
| Provision | Requirement | Your Right |
|---|---|---|
| No GAP Refund Statute | Contract governs | Maryland sets no statutory refund rule for debt cancellation (GAP) agreements; any cancellation or refund right comes from the agreement's own terms |
| Optional, Itemized Charge | Com. Law § 12-609(b)(4) | A seller may charge and finance an optional debt cancellation (GAP) agreement only if its cost is separately itemized in the financing agreement |
| Not Regulated as Insurance | Maryland Insurance Administration | Debt cancellation agreements are not insurance and are not regulated by the MIA; disputes go to the Attorney General's Consumer Protection Division |
| Consumer Protection Act | Com. Law § 13-303 | Unfair, abusive or deceptive trade practices in consumer sales and the extension of consumer credit are prohibited, including misrepresenting GAP refund rights |
| Private Remedy | Com. Law § 13-408 | You may sue for injury or loss caused by a prohibited practice, and the court may award reasonable attorney's fees |
No GAP Refund Statute
Contract governsOptional, Itemized Charge
Com. Law § 12-609(b)(4)Not Regulated as Insurance
Maryland Insurance AdministrationConsumer Protection Act
Com. Law § 13-303Private Remedy
Com. Law § 13-408What Maryland Law Requires
Your Refund Rights
Under Maryland Consumer Protection Act and Retail Installment Sales Act (no GAP refund statute), Maryland consumers who pay off auto loans early are entitled to pro-rata refunds on unused GAP insurance and warranty coverage. You're entitled to a pro-rata refund based on unused coverage time.
GAP coverage is often refundable after an early payoff, a refinance, or a total loss on which GAP paid no claim — but the contract, state law, and unused coverage determine the amount.
A formal demand letter citing your state's exact statutes is harder to ignore than a generic email.
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Frequently Asked Questions
Do I get a GAP refund if I pay off my car early in Maryland?
It depends on your GAP agreement. Maryland lets dealers sell optional, itemized debt cancellation (GAP) agreements (Com. Law § 12-609(b)(4)) but sets no refund rule, so the agreement's cancellation terms decide. Misrepresenting or unfairly withholding a refund can violate the Consumer Protection Act (Com. Law § 13-303).
How do I cancel GAP insurance in Maryland?
Submit a written cancellation request to your dealer or GAP provider. Include proof of loan payoff and reference your contract's cancellation provisions.
What if my Maryland dealer refuses to refund my GAP?
Complain to the Maryland Attorney General's Consumer Protection Division — a GAP (debt cancellation) agreement is not insurance, so the Maryland Insurance Administration does not handle it. If the refusal is an unfair or deceptive practice you can sue for your loss, with possible attorney's fees (Com. Law § 13-408), including in small claims court.
Where do I file a complaint about a GAP refund in Maryland?
File with the Maryland Attorney General's Consumer Protection Division. For problems with how the GAP charge was sold in your vehicle installment contract, the Office of Financial Regulation also takes Retail Installment Sales Act complaints. The Maryland Insurance Administration does not regulate debt cancellation agreements.
Maryland Regulatory Contacts
If you need to file a complaint or seek assistance, contact these official agencies:
Contact information is provided for reference. Verify current details on official agency websites.
Compare Other States
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Optional letter only if you act · Maryland Consumer Protection Act and Retail Installment Sales Act (no GAP refund statute)