What is GAP?
If a vehicle is totaled or stolen, the borrower's primary
insurance company settlement can be significantly less
than the outstanding loan or lease balance. This may
create a deficiency balance or a "gap" resulting
in a serious financial hardship for you, the borrower.
The "gap" may even jeopardize repayment of
the loan. GAP is designed to relieve you of the responsibility
for the remainder of the loan or lease balance that
your primary insurance carrier does not cover.
What does
GAP cover?
GAP covers the difference between your outstanding loan
or lease balance and the actual cash value of the vehicle
(primary insurance company settlement). GAP also covers
up to $1000 of the your deductible if there is a "gap"
after the primary insurance settlement is paid. It is
covered as part of the deficiency balance and is not paid
directly to you.
Your Benefits
Low cost protections with a 60-day free look
Eliminates the out-of-pocket expense for the remaining
loan balance after loss settlement
Helps you avoid financial hardship and afford a
replacement vehicle
Prevents deficiency balance from being added to
new loan
Helps protect your credit rating
Example:
Insurance
Settlement:
Vehicle ACV
$11,000
Insurance Deductible
$
500
Insurance Settlement
$10,500
Loan Settlement:
Outstanding
Balance
$15,000
Insurance
Settlement
$10,500
Deficiency
Balance
$ 4,500
GAP Waiver
Amount
$ 4,500
Without GAP, your borrower
remains liable for the deficiency balance.
Contact your local branch
office or call 1-800-793-0508 for complete product details.
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