What is GAP Protection?

In the event of a total loss, GAP Protection pays the difference (The Gap) between the customer's loan balance at the time of the incident and the amount paid by the insurance company. Most insurance policies only pay the market value or accepted cash value (ACV) of the vehicle/vessel. This amount is often less than the customer's loan balance. GAP Protection makes sure the customer can pay off the full amount of the loan balance. Here's how it works:

Customer loan balance:		$22,500
Insurance pays ACV:	-	$15,000 –––––––
Customer still owes bank "the gap":		$7500
GAP Protection pays the difference:	-	$7500 –––––––
Customer loan balance:		$0

For customers who do not have regular P&C insurance, GAP Protection will pay the amount the customer's loan balance exceeds the Kelley Blue Book "retail value."