Let's say you buy a new vehicle with a $25,000 loan. You get into an accident and your vehicle is totaled. At the time of the accident, your vehicle is valued at $15,000 but you still owe $20,000 on your loan.
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Progressive AnswersWhat Vehicles types are excluded from GAP InsuranceGuaranteed Auto Protection | Toyota FinancialWhat is Guaranteed Asset Protection (GAP) insurance? | Consumer Financial Protection BureauFor a covered loss, you'd get paid for the value of your vehicle at the time of the incident ($15,000). This leaves $5,000 owed on your loan. With gap insurance, the difference would be covered, minus any deductible.
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Car Insurance LapsePlease note, gap insurance coverage must be purchased at the same time as your car and you must be the car's first owner.
