(1) This regulation applies to an arrangement between 2 persons ( person 1 and person 2 ) made in the following circumstances:
(a) person 1 leases or rents something from person 2;
(b) under the arrangement, person 1 makes a payment to person 2 to reduce the amount that person 1 would otherwise have to pay to person 2 under the leasing or rental agreement;
(c) the payment relates to the event of an accident or other eventuality affecting the thing that is being leased or rented.
Example: Collision damage waiver insurance for a rental car.
(2) For paragraph 765A(1)(y) of the Act, the arrangement is not a financial product.