Guaranteed Asset Protection insurance, commonly referred to as GAP coverage, is a type of optional insurance that acts as a financial safeguard for new, leased, or financed vehicle owners. GAP coverage can be a lifesaver in many ways, offering protection options for vehicle owners when there is a gap between a vehicle's depreciated value and the loan balance when a total loss occurs. It's important to understand how GAP coverage works and to be aware of some additional benefits.
In many ways, GAP coverage acts as a financial shield for owners of financed or leased vehicles. This affordable insurance is designed to pay for the difference between the insurance payout and the remaining loan amount if your vehicle is ever totaled or stolen. GAP insurance can play a huge role in preventing potential financial strain when the loan balance is higher than the value of the vehicle, making it a great choice for those who owe a balance on their Auto Loan. GAP coverage can help eliminate financial strain should an unexpected loss occur.
GAP coverage gives owners of financed or leased vehicles peace of mind knowing that their investment is protected against rapid vehicle depreciation during the initial loan period. If you placed a small down payment on the purchase, rolled a balance owed from another vehicle into your new loan, or don't plan to pay off the vehicle within 5 years, GAP coverage is important because a vehicle typically depreciates quickly and often outpaces the loan repayment.
The good news is that GAP coverage is both affordable and easily integrated with your Auto Loan and insurance policies to provide a cost-effective way to protect your investment. GAP coverage can be purchased in the following ways:
Did you know that some cars depreciate faster than others? Luxury vehicles, certain electric or EV models as well as compact cars are examples of vehicles that depreciate at a higher rate. As a result, drivers may owe more to lending and leasing companies than the actual vehicle's worth. If you own a vehicle that comes with a higher depreciation rate, it's especially important to take advantage of GAP coverage to help protect against your vehicle’s accelerated value loss.
GAP coverage is essential for anyone who would experience financial strain paying the remaining Auto Loan balance should their vehicle be deemed a total loss as a result of an accident or theft. While required comprehensive and collision insurance pays for vehicle damages due to things like accidents, a fire, or theft, some coverages only pay the actual cash value of your vehicle – not the replacement value. This means that in the event of a total loss, you would only be reimbursed for the depreciated value of your car. GAP insurance offers protection above claims for a total loss so that you aren't stuck paying the difference between the insured value of the car and the amount that you owe a lender. GAP insurance can help protect owners against unexpected and significant expenses, and provide crucial financial relief in a total loss situation.
GAP Insurance Can Help Vehicle Owners With:
Peach State is a smart place to bank, especially if you're looking for a car loan and GAP coverage to protect your asset. Our “Car Loans 101: Car Buying Made Easy Guide” can help you understand exactly what to expect when you purchase a new car and offers tips to help you find not only the right car, but the best car loan and monthly payment to suit your budget. Contact us today to learn more about Auto Loans and GAP coverage options at Peach State.
Limitations and exclusions may apply. GAP Insurance products are not products of the credit union and are not obligations of or guaranteed by the credit union. GAP Insurance is offered through Assurance Plus Claims. The credit union makes no representations as to the services of any provider. For details about coverage and costs, please visit one of our convenient branch locations or contact us.
1 The Auto Deductible Reimbursement will pay up to $1,000 per loss (unlimited losses per year) when a loss is filed and paid by your auto insurance company for a covered auto that you own or lease as evidenced by the title, registration or loan document. It insures your auto under an Auto Insurance Policy designating you as the named insured. Filing your claim is simple and easy – just call 877.296.4892 or visit Assurance Plus Claims to get started!