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Vehicle prices continue to
increase. At the same time, many borrowers want longer
loan terms and are making smaller payments. For these
reasons it's typical for a vehicle's outstanding loan balance
to be significantly higher than its actual cash value,
especially during the first few years of the loan.
If your vehicle is totaled
or stolen, your insurance settlement will be based on the
vehicle's actual cash value, not the outstanding loan balance.
This may create a deficiency balance or "gap". You could
be stuck paying hundreds - or even thousands- of dollars out
of your own pocket to pay off the deficiency balance.
Now you can protect your
vehicle, boat, motorcycle, or RV investment with Guaranteed
Asset Protection (GAP). GAP is designed to eliminate
your unpaid net loan/lease balance in the event your vehicle
is stolen or damaged beyond repair (totaled).
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GAP supplements your primary
auto insurance coverage. You can benefit from GAP
whether you finance or lease a new or used vehicle. It
covers automobiles, vans, light trucks, motorcycles, boats,
travel units, motor homes, jet skis, snowmobiles and almost
any other vehicle.*
GAP coverage goes into
effect when you need it most - when your vehicle is stolen and
isn't recovered, or is totaled in an accident and can't be
repaired.
GAP covers the difference
between your primary insurance carrier's settlement and the
outstanding loan or lease balance, less delinquent payments,
late charges, refunable service warranty contracts, and other
insurance-related charges. Included in this difference
is your insurance deductible, up to $1,000.**
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