BROWSE

Gap Insurance

Definition

Guaranteed Auto Protection insurance was established in the North American financial industry. GAP insurance is the difference between the actual cash value of a vehicle and the balance still owed on the financing. GAP coverage is mainly used on new and used small vehicles and heavy trucks. Some financing companies and lease contracts require it.

What is 'Gap Insurance'

A type of auto insurance that car owners can buy to protect themselves against losses that can arise when the amount of compensation received from a total loss does not fully cover the amount the insured owes on the vehicle's financing or lease agreement. This situation arises when the balance owed on a car loan is greater than the book value of the vehicle.

Explaining 'Gap Insurance'

For example, according to the blue book, John's car is worth $15,000. However, he still owes a total of $20,000 worth of car payments. In the event that John's car is completely written off as a result of an accident or theft, John's car insurance policy will reimburse him with $15,000. Because John owes the car financing company $20,000, however, he will still be $5,000 short, even though he no longer has a car.

If John had purchased gap insurance, the gap insurance policy would cover the $5,000 "gap", or the difference between the money received from reimbursement and the amount still owed on the car.


Further Reading


Statistical and financial models of insurance pricing and the insurance firm
www.jstor.org [PDF]
… possible to find textbooks and books of essays on uncertainty and in- formation in economics and finance for graduate students and researchers, there is no equivalent material that covers advanced research in insurance. The purpose of this book is to fill this gap in literature …

Empirical Study on Regional Gap of Insurance in China Based on Insurance Density Perspective <span style=[J]' src='/thumbnails/?img=http%3A%2F%2Fen.cnki.com.cn%2FArticle_en%2FCJFDTotal-DJKX200903014.htm' />Empirical Study on Regional Gap of Insurance in China Based on Insurance Density Perspective [J]
en.cnki.com.cn [[J]' href='https:/api.miniature.io/pdf?url=en.cnki.com.cn%2FArticle_en%2FCJFDTotal-DJKX200903014.htm'>PDF]
… possible to find textbooks and books of essays on uncertainty and in- formation in economics and finance for graduate students and researchers, there is no equivalent material that covers advanced research in insurance. The purpose of this book is to fill this gap in literature …

Financial insurance productFinancial insurance product
patents.google.com [PDF]
… possible to find textbooks and books of essays on uncertainty and in- formation in economics and finance for graduate students and researchers, there is no equivalent material that covers advanced research in insurance. The purpose of this book is to fill this gap in literature …

The rise of private health insurance in Australia: early effects on insurance and hospital marketsThe rise of private health insurance in Australia: early effects on insurance and hospital markets
journals.sagepub.com [PDF]
… possible to find textbooks and books of essays on uncertainty and in- formation in economics and finance for graduate students and researchers, there is no equivalent material that covers advanced research in insurance. The purpose of this book is to fill this gap in literature …

Rural urban income gap and critical point of institutional change <span style=[J]' src='/thumbnails/?img=https%3A%2F%2Fen.cnki.com.cn%2FArticle_en%2FCJFDTotal-ZSHK200305001.htm' />Rural urban income gap and critical point of institutional change [J]
en.cnki.com.cn [[J]' href='https:/api.miniature.io/pdf?url=en.cnki.com.cn%2FArticle_en%2FCJFDTotal-ZSHK200305001.htm'>PDF]
… possible to find textbooks and books of essays on uncertainty and in- formation in economics and finance for graduate students and researchers, there is no equivalent material that covers advanced research in insurance. The purpose of this book is to fill this gap in literature …

The× Effectiveness of Gap Insurance With Respect to Basis Risk in a Shareholder Value Maximization SettingThe× Effectiveness of Gap Insurance With Respect to Basis Risk in a Shareholder Value Maximization Setting
onlinelibrary.wiley.com [PDF]
… possible to find textbooks and books of essays on uncertainty and in- formation in economics and finance for graduate students and researchers, there is no equivalent material that covers advanced research in insurance. The purpose of this book is to fill this gap in literature …

Research on Regional Difference in Insurance Market of China <span style=[J]' src='/thumbnails/?img=http%3A%2F%2Fen.cnki.com.cn%2FArticle_en%2FCJFDTotal-CJKX200603016.htm' />Research on Regional Difference in Insurance Market of China [J]
en.cnki.com.cn [[J]' href='https:/api.miniature.io/pdf?url=en.cnki.com.cn%2FArticle_en%2FCJFDTotal-CJKX200603016.htm'>PDF]
… possible to find textbooks and books of essays on uncertainty and in- formation in economics and finance for graduate students and researchers, there is no equivalent material that covers advanced research in insurance. The purpose of this book is to fill this gap in literature …

The Impact of Filling-up the Gap and Cutting Down the Amount of Personal Account of Pension Insurance on the Level of Retirement Pension <span style=[J]' src='/thumbnails/?img=http%3A%2F%2Fen.cnki.com.cn%2FArticle_en%2FCJFDTotal-TJYJ200705009.htm' />The Impact of Filling-up the Gap and Cutting Down the Amount of Personal Account of Pension Insurance on the Level of Retirement Pension [J]
en.cnki.com.cn [[J]' href='https:/api.miniature.io/pdf?url=en.cnki.com.cn%2FArticle_en%2FCJFDTotal-TJYJ200705009.htm'>PDF]
… possible to find textbooks and books of essays on uncertainty and in- formation in economics and finance for graduate students and researchers, there is no equivalent material that covers advanced research in insurance. The purpose of this book is to fill this gap in literature …



FAQ


What does GAP insurance protect?

It protects against loss in case of an accident or theft.

Who offers this coverage?

Most auto insurance companies offer this coverage to consumers.

When is it usually paid upfront?

It's typically paid upfront when purchasing a new or used vehicle.

How can one get a refund if heshe sells or refinances their vehicle?

If one sells or refinances their vehicle, they are eligible for a refund from their insurer.

Leave a Reply

Your email address will not be published. Required fields are marked *