GAP protection (Guaranteed Asset Protection) for an RV is a type of coverage that can make up the difference (or “gap”) between the amount you owe on your RV loan and the RV’s actual cash value (ACV) in the event of a total loss.
Here’s an example: If you buy an RV and finance it, you might owe more on the RV than it’s actually worth due to depreciation. If your RV is then stolen or damaged beyond repair, your regular protection policy would typically pay you the RV’s actual cash value at the time of the loss, which could be less than the amount you still owe on your loan. This would leave you with a “gap” between what your protection pays out and what you still owe to your lender.
This is where GAP protection comes in. If you have GAP coverage, it would pay the difference between the protection payout and the remaining balance on your loan, effectively covering this “gap” and preventing you from being out-of-pocket for the remainder of the loan.
It’s worth noting that the specific terms of GAP protection can vary between providers, and not all total loss situations might be covered. So, as with any protection product, it’s important to read and understand the policy before purchasing.
