Accidents can happen when you least expect it, and if your car is totaled or stolen, you want to be prepared. That’s where GAP insurance comes into play.
What is Gap Insurance?
Guaranteed Asset Protection (GAP) insurance is designed to cover the financial gap between what you owe on your auto loan and your car’s value. The moment you drive off the lot with your new vehicle, it starts to lose value, and this depreciation continues over time. If your vehicle is totaled, standard auto insurance typically pays out only for its current market value. This means you could be responsible for covering the difference between that payout and your outstanding loan balance. GAP insurance helps bridge this gap, ensuring you aren't left with unexpected costs when your vehicle is deemed a total loss.
Why You Need GAP Insurance
A totaled vehicle doesn’t have to lead to a total financial loss! If your car is declared a total loss after an accident, you may find yourself having to pay off the remaining loan while also needing to buy a new vehicle. GAP insurance is your safety net, knowing that your investment is protected.
MVCU offers members the option of GAP insurance during loan closing, providing peace of mind while driving your new car. Additionally, GAP insurance may provide coverage if your car is stolen, after an investigation. It’s important to note that there may be situations where out-of-pocket costs could still apply, so be sure to consider your options. GAP insurance coverage is subject to terms, conditions and exclusions that may affect the total amount covered.
For comprehensive details on coverage and limitations, please refer to your GAP agreement. For more information, including coverage terms, exclusions and costs, call our Member Support Team at 800-356-0067 or visit https://www.mvcu.com/auto.
Category: Car Ownership
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