Will your insurance pay-off your loan if your vehicle is deemed a total loss? Don’t find out the hard way!

Why buy GAP Insurance?

  • GAP helps pay off your remaining loan/lease balance if your vehicle is stolen or damaged and is deemed to be a total loss.
  • GAP helps clear your credit, allowing you to start fresh with a new vehicle.
  • GAP is inexpensive when you purchase through your credit union and it can be included as a small addition to your monthly payment.

What is GAP?
GAP is Guaranteed Auto Protection. It helps cover the difference between the
actual cash value of the vehicle (primary insurance company settlement) and the
outstanding loan balance at the time of loss.

What does GAP NOT Cover?

  • Any refundable additions to the loan amount such as Service Contracts and Other insurance
  • More than 2 delinquent payments
  • Late charges, fees, extensions, or other money added to the loan after inception
  • Any portion of the loan, at loan inception, that exceeded 150% of MSRP (new vehicles) or 150% of NADA average retail book value (used vehicles)
  • Interest accrued after the date of loss

Can GAP be purchased after loan origination?
Yes, they can purchase GAP anytime after loan origination as long as they have
not experienced a total loss due to collision or theft. However, it is not retroactive
and the coverage goes into effect the day the GAP is purchased and covers the
remaining term and balance.

Is the deductible covered by GAP?
The primary insurance deductible is waived only to the extent it is part of the GAP amount. Any portion of the deficiency balance caused by the borrower’s deductible will be reimbursed up to $1,000, where permitted. This coverage is not available by law in all states.

Can GAP be transferred to a different loan or vehicle?
No, GAP is not transferable. GAP covers the loan and the vehicle that is listed on
the loan agreement, and may not be transferred to a new loan or vehicle.

What if the borrower decides to purchase their totaled vehicle back from
the insurance company?
If they purchase their totaled vehicle back from their insurance company, the
salvage price will be deducted from their GAP claim amount.

What if additional funds are added or the term extended will the the
borrower need to buy a new GAP policy?
Yes, if they would like the additional funds and/or term extensions covered.

Can GAP be sold on a multiple collateral loan?
We recommend that GAP not be sold on this type of loan. However, if sold
and a claim is filed then the claim will be adjusted to the percentage of the
loan balance that the totaled vehicle represents.

Call your local branch for more information or to purchase GAP insurance for your

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