GAP Insurance

GAP, which stands for “Guaranteed Asset Protection”, is insurance that helps protect the customer from having an unpaid finance balance in the event of total loss or theft of the vehicle.

Insurance companies will typically only pay the Actual Cash Value (ACV) for a vehicle in the event of total loss or theft, regardless of the finance balance. This means if the customer owes more for their vehicle then what the insurance company determines as the ACV, they will be left with an unpaid finance balance that the customer is responsible for.

How does Guarantee Asset Protection work?

Let’s say your vehicle has just been totaled because of an accident. You originally paid $26,000 and financed it for 72 months. The accident happened after 24 months of ownership. You owe $18,000 but your auto insurance says the actual cash value of your vehicle is only $10,000. The “GAP” between what you paid for your vehicle originally and what the insurance company will pay out is $8,000. If you didn’t have GAP coverage, your out of pocket expense would be $8,000. If you had GAP, the out of pocket expense would be $0.

GAP Insurance Graph


  • Never having to pay-off potentially thousands of dollars for a vehicle you no longer have
  • GAP coverage lasts for the entire term of the loan
  • Protects customer from depreciation on newer vehicles
  • In states that payout a deductible, GAP insurance will pay the insurance deductible and unpaid finance balance

Why GAP Insurance Is for You

  • Your financing extended terms
  • You have a small down payment
  • You had negative equity in your last vehicle, that you rolled into your new vehicle loan
  • You log more miles than the average driver
  • Purchased a vehicle with a high depreciation rate

GAP Insurance saved me thousands of dollars! My vehicle was totaled in an accident that was not my fault. I was upside down in my vehicle because I owed more than what it was worth. But I didn’t have to worry about it because GAP insurance covered the negative equity as well as my insurance deductible. I will never buy another vehicle without GAP insurance on it.

James Alexander

Exclusions May Apply

The information above is to provide a summary of the coverages and benefits that GAP Insurance provides. Exact terms, conditions and exclusions can be found on the GAP Insurance Contract.