WHAT IS GAP?
Guaranteed Asset Protection, or GAP, is a voluntary, non-insurance program offered as protection on a new or used vehicle that is financed or leased. It is a supplemental benefit that enhances, rather than replaces, your standard comprehensive, collision, or liability coverage. GAP waives the difference between your primary insurance carrier's settlement and the payoff of your loan.1 In other words, it protects the "gap" between your vehicle's value and the amount you still owe in the case it is damaged beyond repair or stolen and never recovered.
HOW DOES GAP WORK?
Depending on where you live, the established market value of your vehicle could be less than the actual balance you owe. In the event of a total loss or theft, GAP waives the difference between your primary insurance carrier insurance settlement and the payoff of your loan or lease, less delinquent payments, late charges, refundable service warranty contracts and other insurance related charges.2 Included in the deficiency balance is the deductible up to $1,000.
Who benefits from GAP?
- Anyone who lives in a city with a high rate of automobile theft
- Anyone who drives in today's traffic during rush hour, on freeways, state highways and the nation's interstates
- Anyone who values his or her investment in a new or pre-owned automobile
Less delinquent payments, late charges, refundable service warranty contracts and other insurance related charges.
Subject to other applicable exclusions and limitations. GAP is subject to a loan-to-value limitation which may cap the benefit you receive.