Place the unwrapped caramels from the 110.8 ounce package and 2 tablespoons water in a medium saucepan.
Heat over medium-low, stirring frequently; as the caramels soften, continue stirring until they are completely melted and the mixture is smooth with no lumps.
Remove the saucepan from the heat and stir in 1/3 cup half and half until fully combined and smooth.
Pour the caramel sauce into a jar and let cool to room temperature before using.
Store any leftover sauce in an airtight container in the refrigerator for up to 2 weeks.