What is GAP Insurance?

In the event, your vehicle is stolen, accidentally damaged beyond repair, or otherwise declared an insured total loss, your insurance company pays the actual cash value of the vehicle at the time of loss. This may be significantly less than what you owe on your loan. You remain liable for the payment of the difference between your insurance company’s settlement and the balance of your loan. This deficiency added to the amount of your deductible, and other expenses can easily be thousands of dollars – money that comes out of your pocket unless you have auto GAP waiver!

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What are the benefits of GAP?

 GAP auto waiver addendum pays your remaining loan balance after insurance proceeds are applied to your loan.

 Protection is provided for the term of your loan (up to 84 months on our GAP  Plus waiver only).

• Covers primary insurance deductible up to $500.00

• Prevents deficiency balance from being added to a new loan.

• Helps protect your credit rating
  
   

What vehicles are eligible for GAP?

New and used autos, vans, SUV’s and light trucks up to 1-ton load capacity.

 

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Can I buy GAP on a salvage/reconstructed title vehicle?

Yes. Salvage or reconstructed title vehicles are eligible for GAP - this is one of the areas Dealer Nav specializes in.

 

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I will be using my vehicle for my business, can I buy GAP?

If the vehicle is titled under an individual, not a business name, it is eligible for GAP. However, vehicles used for hire, rental, or taxicabs are not eligible.

 

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Does GAP replace my comprehensive and collision coverage?

No. GAP is not a substitute for collision or property damage insurance. You must continue to maintain comprehensive and collision insurance coverage or your GAP coverage will be void.

 

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Will I receive something in the mail after I purchase GAP explaining the coverage?

No. The GAP coverage is defined in the GAP Waiver Addendum given to you at the time of purchase.

 

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Can I purchase auto GAP insurance after I purchase?

No. If you choose to purchase GAP coverage, it must be executed at the time of your purchase.

 

 

Is there a deadline to file a GAP claim?

GAP claims must be filed within 90 days from the date of total loss of your vehicle.

 

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How do I receive payment for the GAP claim?

The GAP claim settlement is paid to the lender and applied to your loan.

 

 

I have an extended service contract on my vehicle – does this affect the GAP claim?

GAP does not cover the refundable portion of any service warranty or full term credit life insurance.

 

 

Does GAP pay if I am uninsured?

No. You must maintain comprehensive and collision insurance on your vehicle or your GAP contract will be void.

 

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I am refinancing my loan at another financial institution – can the GAP transfer to my new loan?

No. GAP is non-transferable.

 

 

My car has been totaled. Should I continue to make payments on my loan?

Yes. Continue to make your loan payments and notify the claim representative of the total loss as soon as possible.

 

 

Is GAP required to obtain credit? 

GAP protection is optional and not required to obtain credit. 

 

Can GAP be offered on older vehicles?
It depends. If NADA can establish a value, then GAP can be added to the loan subject to the 125% policy limitation. If the vehicle is not in NADA, then GAP cannot be added to the loan.

 

Can GAP be sold on Motorcycles?
No. Dealer Nav does not offer a GAP waiver for motorcycles, ATV's, or any other recreational equipment at this time. 

 

What happens when an existing loan with GAP has additional funds added to it or the term is extended? 
Any extension of term or funds on an auto loan would cancel your GAP waiver addendum, you can check with our administration department to see if you are eligible to purchase a new GAP waiver. 
 

Can the GAP Waiver be canceled? 
This GAP Addendum is cancelable upon written notice to the Administrator at Administrator’s address set forth on the application portion of the GAP Addendum, subject to the effective date of the cancellation not being prior to the date the written notice is received by the Administrator. A cancellation requested within thirty (30) days of the purchase is eligible for a full refund. After the thirty (30) days, and provided a written request is sent to the Administrator within ninety (90) days of whatever event occasions the Borrower’s termination of the Financial Agreement, refunds will be calculated on a Pro rata basis (unless otherwise required by your state law), less a $50.00 cancellation fee. The lien holder will be listed as loss payee on all refunds and sole payee on any refunds due to repossession.

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Does the GAP Waiver remain in effect if the loan is refinanced?
NO. The waiver is an addendum to the loan agreement. If the original loan goes away so does the addendum.  If the loan is refinanced within the first (30) days please refer to the cancellation portion of this FAQ's page to determine if a refund is applicable. If the customer wants to keep GAP on their loan, they would need to purchase a new waiver. Please contact our admin department to see if you are eligible for a new GAP waiver addendum.

 

Can a GAP Waiver be purchased on a single pay note?
NO. There is no uniform payment being applied so there is no reduction in the principal of the loan. Therefore, a GAP Waiver would not be able to be put on the note.

Can the GAP Waiver be transferred to a different vehicle?
NO. If the vehicle is substituted in place of one that has a GAP waiver, the customer will need to purchase a new GAP Waiver. 

How are Service Warranties, MBI, and other credit related insurance handled in regards to a GAP claim?
Anything that is refundable (unearned) will need to be subtracted out of the settlement amount prior to submitting the claim for payment. If the claim is submitted without these amounts deducted form the loan balance, we will make the adjustments prior to paying the claim. Therefore, the earned portion will be included into the settlement.

Does the borrower always get reimbursed for their primary insurance deductible?
Not Always. The GAP benefit will only reimburse the primary carrier deductible if the deductible is part of the deficiency balance. For example:
Loan Balance at the Date of Loss: ($15,000)
Primary Insurance Carrier ACV: $13,000
Primary Insurance Deductible: ($ 500)
Net Settlement from Primary Insurance Carrier: $12,500

 

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