What is GAP Insurance & Do You Need It
What is GAP Insurance & Do You Need It?
What Is GAP Coverage?
GAP coverage (Guaranteed Asset Protection) or Total Loss Protection is an optional protection that helps cover the difference between what you owe on your vehicle loan and what your auto insurance pays if your vehicle is totaled or stolen.
When a vehicle is declared a total loss, insurance typically pays the current market value of the vehicle—not the amount you still owe on your loan. Because vehicles can depreciate quickly, that payout may be less than your remaining loan balance. GAP coverage helps bridge that “gap.”
How GAP Coverage Works
If your vehicle is totaled or stolen and not recovered:
Your insurance company pays the current value of the vehicle.
If that amount is less than what you still owe on your loan, GAP coverage helps pay the remaining balance (up to the plan’s limits).
Without GAP coverage, you could be responsible for paying that difference out of pocket.
Why Many Drivers Choose GAP Coverage
GAP coverage can be especially helpful if you:
Made a small down payment
Financed a vehicle for a longer term
Rolled negative equity from a previous loan into a new one
Purchased a new vehicle that depreciates quickly
Peace of Mind When You Need It Most
Accidents and theft are unexpected. GAP coverage helps ensure you’re not left paying for a vehicle you no longer have, giving you financial peace of mind during a stressful situation.
Simple and Convenient
When GAP is included with your vehicle financing, it’s rolled into your loan and handled directly through the dealership—no separate policy to manage.