GAP (guaranteed asset protection) auto insurance coverage is one the most necessary, yet least understood insurance products available to vehicle owners. It is generally purchased through the auto dealership or leasing company at the time of the initial purchase or lease.
It's purpose is simple: If your car is totaled, gap insurance will cover the difference between what your insurance company says your car is worth (actual cash value) and what you still owe on your loan or lease.
The gap insurance is part of your auto loan so I am not sure what your question is. Gap insurance covers your car if you total it and the fair market value for your car is below what you owe. If your car gets reposessed, you still owe the lender. Actually, the cost of the gap insurance is rolled into the loan - it's not part of the loan. If you can find your original paperwork from when you bought your car, find the information on the company that issued the gap insurance policy, and then call them and tell them you no longer own the car, and see if you can get a partial refund on the premium! Can't hurt to try, right? I do vehicle refinances, and our auto loan contract includes the gap insurance (although we call it something else) for free, so I have helped several people cancel their gap coverage, although we usually do it pretty early in the loan. Same with credit disability insurance, if you have it.
If they gave you 16000 on the car, you would not need gap insurance since your loan amount is 12400.
What is Illinois gap car insurance? Is insurance you can purchase to cover the gap between the cost of repaying your car loan and the amount the insurance company will actually give you for your totaled car.
The purpose of gap insurance on an automobile loan is to pay off the portion of the loan that wasn't paid by your auto insurance company. If you the insurance company pays off the entire loan, there isn't a trigger to activate the gap policy and there isn't an amount to pay since it only pays the difference. Example: You buy a brand new car for $20,000. You drive off the lot and now the car is worth $17,000. If you have a covered loss and it is determined that the auto is totaled, the insurance company pays to the loss payee (loan company/lien holder) $17,000 because that is what the car is worth now. The gap policy would pay the additional $3,000 and pay off the loan. If you didn't have gap insurance, you would stay have to pay off the $3,000 even if the car was totaled out.
GAP insurance helps cover the difference if your car is deemed a total loss and is worth less than what you owe on the loan. GAP insurance only runs out when you pay down your loan enough that you have equity in the vehicle.
Yes as they are two different things entirely. GAP covers the difference in what the insurance pays and the amount owed on your loan for the vehicle. GAP will not pay you a nickel yourself. If the actual cash value of the vehicle is more than the amount owed on the loan the GAP pays nothing at all.
GAP insurance will pay the difference between what your car is worth and what is owed on the loan.
Yes, you should get auto insurance coverage when you have a car loan, and even when you don't have a car loan. The law requires it either way anytime a motor vehicle is operated on public roads..
It depends. if you have GAP insurance, the insurance company will pay the payoff amount. If you do not have GAP insurance, it is the holder of loan's responsibility to pay off the complete open loan regardless of the amount paid by the insurance company.
NO,, GAP Insurance is supposed to pay the difference between what your Auto Policy paid and any remaining portion of your loss after the Auto Insurance Policy has paid it's maximum. If No Auto Insurance Policy is in Place providing comprehensive and collision coverage then your GAP Policy is Null and Void. GAP coverage only pays in conjunction with your Auto Insurance Policy. No Auto Insurance! No Gap Payment
Gap insurance refers to insurance which covers the gap between new car replacement and the current value of the car. It eliminates the risk of a car insurer not paying out enough in the event of a loss.
If you don't own your car, but are leasing or making payments, gap insurance protects your vehicle lease or loan. It will also pay your regular insurance deductible in the event of loss.