Gap Insurance

nkmonty1

Hi
Goood afternoon. I just needed to find out about GAP Insurance. Can anyone tell me if this is true or not? On a site that I saw it said that GAP Insurance not only covers what your insurance doesnt cover but gives you up to a couple of thousand dollars for a new car. HMMM that sounds too funny for me.
I do need Gap Insurance buy my insurance company does not cover it and I dont know how or where to start. Any suggestions would be so helpful
Thanks
Nan

marsha7

I never heard of GAP giving you any extra money, but for a basic understanding, go back about 50-75 posts, read what was asked and answered, and then come back with any unanswered questions...

joel0622

Some companies will give you money toward a new car if you replace the car at the same dealership that you bought the car/gap insurance at. it is an incentive to get a dealer carry a particular companies product.

nkmonty1

Its funny I am having a hard time trying to get Gap Insurance with extended auto warranty at the same time. I didnt want to buy from two different companies. Any suggestions.?
Nan

marsha7

joel: thanks for that info, I never would have thought that could happen...

nk: The extended warr is usually either from the carmaker (like Ford ESP Warranty) or an independent company...those companies may not offer GAP as it is a different kind of insurance...

kinda like Prudential may offer car and home ins, but not motorcycle ins...

dsoret

My husband leased a vehicle about 4 months ago and since then is diagnosed with terminal cancer. Will gap insurance pay for the vehicle (the contract is in his name alone) when he passes? I don't believe he purchased the gap ins.,and if not, can we still buy it? Thank you for any advise.

joel0622

Sorry for your current situation.

Gap will not pay for the vehichle in this situation. Here is Fords program for situations such as this. I would be suprised if all manufactures don't have a similar program. This is not a warranty or insurance you would have had to buy. It is at no additional charge and applies to all Ford Leases or Loans.

Peace of Mind lets you lease a new vehicle through Ford Credit without concern about leaving your family to deal with unwanted obligations.



In the event of the lessee's death before the lease terms are satisfied, Peace of Mind allows the return of the vehicle to Ford Credit. Any surplus derived form the wholesale sale of the vehicle will be refunded to the co-lessee of the estate.



If you pass away before your lease obligation is fulfilled, your eligible co-buyer, co-lessee, estate or spouse may receive Peace of Mind benefits. Peace of Mind is available at no extra charge to customers who are at least 62 years of age when they lease a new vehicle through Ford Credit. To be eligible for Peace of Mind, co-buyers and co-lessees must also be age 62 or older. The spouse of a qualified customer is not required to have reached 62 years of age.

dsoret

Thank you for the information. However, my husband leased through GMAC. He is 65, but I don't know if they offer the same Peace of Mind benefits. I am 58. Again, thank you for any information you may have!

im_brentwood

So sorry to hear the news, you have my sympathies.

As far as the lease goes, if I recall, GMAC has a similar program, simply turn the car in and you can walk away. You might ask your dealer's Finance Manager as well.

dsoret

Sorry, I appreciate all the help you have tried to give me, but I talked to GMAC today and they do not have ANY Peace of Mind Benefits! In fact, they didn't even know what I was talking about! My dealer was in the dark also; never heard of it he said! Therefore, I am stuck with a 36 month lease on a 2007 vehicle that we cannot use (due to my husband's terminal cancer)! I sooo appreciate all the info you gave me and how you tried to help!

qbrozen

Well, your other choice is to sell it privately and make up the difference out of your pocket to get the title released from the leasing company.

joel0622

I just called GMAC for you to make sure and you are correct, they offer no such program. She said the way it work is that you would turn in the car at any GM dealer and they would auction the car and bill the estate for any difference in the lease payoff and what the car brought at auction.

dsoret

Thanks again! I will probably try to sell it myself, or with one of the lease/sale websites like swapalease or leasetrader. appreciate your help and info.

red927

We went through the same thing with my father-in law's car last March. He passed away 2 1/2 months after leasing a Buick for 39 months. I spoke to GMAC numerous times and they were not sympathetic at all. The dealer also had no idea what to do. I had gotten advice from someone on these boards to contact turn in the car to GM (they are obligated to take it). Then we spoke to an attorney and he advised us to take my father-in-laws name off everything possible to make the estate as small as we could.

I later spoke to the management of the dealer and they tried to be helpful. They remembered my father-in-law and made inquiries about how much it would cost them to purchase the car from GMAC. They found out it would not be financially beneficial for them to purchase the vehicle but they went out of their way to help wherever they could. They even sent someone to pick up the car since my mother-in law does not drive and I am not in Florida. We returned the car to the dealer in May of 2006 and in July, received a bill from GMAC for the difference of what we owed and what they got at auction ($7800). On the advice of the attorney, we ignored the bill. It is now 14 months later and we never heard from GMAC again.

I don't know if they just wrote it off or what, but there has been no contact. I don't know if this is any help, but this was our experience.

Phil

mistrisevl

I have a question about gap that I can't find an answer to. My fiancee has gap insurance on his car, and he got into an accident last week, the damage will be more than the car is worth. The only problem is i just bought a new car and we were having a problem setting up our new insurance for both cars, so the car coverage hit 20 minutes after the accident. So we got denied. Is it required to have car insurance for your gap insurance to be valid??

tidester

Is it required to have car insurance for your gap insurance to be valid??

I believe so. Your contract should spell out the terms - more or less clearly. Anyone here know for sure?

tidester, host
SUVs and Smart Shopper

qbrozen

i can't say for sure, but i think the name alone spells it out "GAP insurance" not "whole insurance" or "complete insurance." Its designed to cover the difference between regular insurance and the payoff. Without regular insurance, there is no gap.

joel0622

You need to call the company who wrote the policy. You also need to know if it is a waiver addendum or a insurance policy. I sell an insurance policy not a waiver addendum. Waiver addendum's are the policies every one talks about finding on line that are so much cheaper then the dealers who sell insurance.

I cannot speak for all policies written, but the one we sell states.

"If no primary insurance is in effect on the date of loss then the actual cash value will be equal to the book value of the covered collateral, including all documented options, accessories, and mileage as of the date of loss.

What that means is that if for instance the car has a book value of $12K and you owe $15K it will still pay the $3K gap of what the insurance company would have given you if you had insurance and what the balance owed is. They will only pay it though after you have payed the first $12K.

Its better then nothing.

Waiver addendum's usually have an insurance clause in them.

BTW why in the world did your Fiancé cancel his original policy prior to having the new policy set up? The way I read your post is he had insurance and then you wanted to start a new policy with both of you? If he canceled his the day you started the new one it should have ran till midnight of the day you canceled and your new policy would have started at 12:01 AM. So that is only a 1 minute time frame you would not have been covered.

marsha7

truth is stranger than fiction...I could not make this situation up, but real life does throw us curveballs;

I would guess that the main policy MUST be in force for Gap to do its job, i.e. pay the GAP between what your policy pays and the amount you owe...so, I would assume that if the main policy was NOT in effect, the GAP would be the total amount that you owe on the car, and I would not expect that Gap policy would pay the full amount...

In other words, one could not allow their insurance to lapse (accidentally or intentionally or unknowingly) and expect Gap ins to pick up the whole boat...

I would expect a clause in their contract stating that, and, even if it doesn't, I would be surprised to find a Gap policy that would act as your entire collision policy and payoff your entire loan from the first dollar...

ritaw

My daughter recently had an accident whereby her vehicle was totaled by the insurance company. She was upside-down with the finacing and luckily she had GAP. The problem we are having is getting them to pay. Her policy is underwritten with Classic GAP insurance out of Florida. We live in Georgia which should not matter as to the expediency of them paying. They are making her jump through hoops just to delay paying such as saying things like, "We haven't got that document fax yet" or "We can't read the document you faxed" Has anyone dealed with this company before? Can someone offer advise as to what to do. The company she had the finace with is telling her she has to make the payment as usual until GAP pays. She cannot afford to make two car payments.

tidester

The "illegible FAX" claim may or may not be legitimate. In any case, they should provide you with a real address to which you can send the documents by registered mail to avoid any such confusion.

tidester, host
SUVs and Smart Shopper

joel0622

GAP sold by a company other then the manufacture is just like AM Service Contracts, there is a reason they are cheaper then the real thing. Any customer I sell a gap policy to I handle the claim for them, I just get there insurance company contact info and go from there. It takes about 5 minutes to prepare the claim.

nkmonty1

I cant understand why the company is doing that to you. I think that you should get the address send it return reciept requested and then once you get the card back call them and see what they say. If they say they didnt get it tell them you got the card back saying they did and whoever signed for its name. If they give you anymore trouble I would call your lawyer to get this taken care of.
I am so sorry that you are going through this junk. I am glad that your daughter is ok. That is the most important thing you know.
I am still trying to get gap insurance for my vehicle and I cant find a company at all.
Good luck with this mess.
Regards
Nan

ritaw

The GAP was purchased along with the sell from Gwinnett Suzuki, Duluth, Georgia. The financing is through HSBC who I understand is notorious to work with. Shouldn't they be getting behind GAP, or is there no correlation at all? Does she need to go back to Gwinnett Suzuki where she bought the car? I believe HSBC had her purchase the GAP. She was told the GAP was required to make the loan. Obvuiosly, they knew she would be upside-down when the loan was made.

marsha7

be related to the basic insurance or the lender, or totally independent as just a free standing insurance...

I agree with the others, as I would send all necessary docs via Fedex to a street address, and the name of the one who signs will be on Fedex's website to verify delivery...

Just thinking out loud on this, you might send a copy of everything that you send to Gap also to your Lender, along with a copy of your Gap policy, so they know you are doing your due diligence...after all, it is your Lender who is awaiting payment from Gap to close out the loan on your car...

You might also contact the agent who sold you the Gap ins (car dealer, maybe?) and consider reporting them to the State Consumer Agency and/or the Attorney General for investigation, maybe also the Insurance Commissioner...

What should be a simple "pay the claim" procedure gets drawn out due to ins companies that do not uphold their agreements...while certain claims are up for discussion, Gap, to me, seems pretty cut and dried...they pay whatever your main insurance does not pay to pay off your loan...

Maybe a couple of million dollar fines from the Insurance Commisisoner would snap them in line...

praz

If a car is totalled and value of the car is more than money owned to the finance at that time, will GAP cover for the deductible of $500?
Thanks.

nkmonty1

Hi
You know that is a good question. I dont think that it would I guess you have to call the GAP company and find out. But I do have a question for you. I am having so much trouble finding the right GAP company. Whats the name of yours and are they any good.
I also in trying to get extended warranty coverage and cant find a right company for that. Any suggestions hmmm from anyone.
Thanks
Nan

kyfdx

I doubt that GAP would cover your deductible.. After all, deductibles can vary.. and are between you and your insurance company, not the GAP provider.

joel0622

Yes, a normal GAP policy will cover a Deductible up to $1000 dollars. Some cap at $500 but I have never seen a policy that does not cover the deductible.

That does not mean there is not one out there that does not which I am sure some one will now point out that in 1997 they bought a car with GAP, totaled it and it did not cover the deductible.

Google "gap insurance deductible" you will see your answer

praz

I purchased GAP from a third party through the dealer when I bought my car. But this third party is affiliated with the finance company/manufacturer and it costed me $600/5 years and I can cancel it anytime. The third party was United Auto.

sky23213

Check with your insurance company first. Some offer it, some don't, but if they do, it's MUCH cheaper. Also, you may cancel it at any time, when you're no longer upside down. In my case the premium was something like $14/6mo, billed along with the other stuff.

wlbrown9

check with gmoutlet dot com I belive that is Black's Pontiac/GMC in Penn. Any GM still under warranty and may other domestic brand...call them if you need to.

Black Pontiac Cadillac’s GM Outlet

(877) 472-9550 Toll Free, (814) 472-9550 Local, (814) 472-4741 Fax

praz

I should have asked my question in a different way, my fault. I was wondering, if GAP insurance is worthless if the car is worth more than the money owed to the finance company when the car is totalled. This might be the case when the car is 2-3 years old, at this time will the GAP pay for the deductible to my insurance company so that one gets 100% value of the car at the time of total loss instead of "Full book value - Deductible".
Thanks

marsha7

GAP is designed to pay off the difference between what you owe and what the car is worth...if the car is totalled and paid at $8,000, but you owe $11,000, GAP will pay the $3K difference, so you do not make any money on it, but walk away OWING nothing...

GAP was originally used for leases, since you owe for the full lease...then it was simply adapted to purchases...

Let's face it...GAP exists because cars, esp American cars, depreciate like a rock, as they are overpriced from Day 1 and the depreciation is like reality catching up with the fantasy...further, if this was like 20 years ago, when folks put a down payment of 25%, GAP would not be necessary because the car would depreciate at the same rate as the 3 year loan was being paid down...

But nobody puts anything down anymore, nobody gets 3 yaer loans anymore, and many folks roll over negative equity, so the average $25K car probably has a loan on it of $30-35K, much more than the car is worth...GAP will usually cover a reasonable amount of negative equity, and it is simply a risk reducing measure, since most cars that are wrecked are not totalled, and GAP only comes in when a car is totalled...if it is not toalled, then one argues for diminished value, but GAP does not apply...

There will be a multiple choice test tomorrow at 10:00...please bring a Number 2 pencil and Photo ID...
50 questions, 60 minutes, no extra credit...no social promotion and no grade curve...:):):):):)...

nkmonty1

Hi
I know this is an out there question. But by any chance you have United Autos phone number? I would really like to find out if I can just purchase the GAP from them since my auto insurance carrier does not offer it and I really think that is an important thing to have. I would rather be safe then sorry.
THanks for the information. I am still trying to get Extended Vehicle Warranty but alot of the companies out there cant be trusted. Any suggestions? I really would appreciate any help I can get.
Thanks
Nan

joel0622

Praz, if you have equity in your car then you have no need for GAP insurance. The only time it covers the deductible is if there is a negitive balance to start with.

praz

They are a group that own quite a few dealership across US. I am not sure if they have a program to sell GAP for cars not purchased through one of their dealers. But, I have a website you can go to http://www.unitedauto.com/

praz

Thank you guys for the info, it was helpful to understand how GAP works.

malostate

MOST OF THE TIME YOU CAN PURCHASE GAP AFTER THE FACT AND AT A DISCOUNT PRICE, SOMETIMES EVEN FOR ABOUT 100 DOLLARS, ALSO THE NATIONAL AVERAGE THAT GAP CLAIMS ARE PAID IS 40% BECAUSE PEOPLE DON'T EVEN KNOW WHO THERE GAP CARRIER IS. THERE IS ALSO SOME NEW PROGRAMS THAT BANKS ARE OFFERING CALLED TOTAL DEBT CANCELLATION. LONG WORD FOR FREE GAP INSURANCE, ITS A WAY THAT BANKS ARE COMPETING FOR THE DEALERSHIP BUSINESS

nkmonty1

Hi

That is something to really pass on. Now I will ask the banks I deal with if they have something like that. I still cant find anyone that has the GAP insurance. I really would like to have that on my car just in case. I rather have that then not have it if something happens.
Thanks for the great info. If you dont mind can you tell me what bank has it so I can check if they have it in my area?
Have a great weekend and for everyone HAVE A GREAT TURKEY DAY!!
Nan

malostate

State Farm Bank offers it, goggle there name.

tedebear

still cant find anyone that has the GAP insurance. I really would like to have that on my car just in case.

A message on this was posted last month but try your car insurance company. Their rates are generally MUCH lower than a company that just sells gap insurance.

For instance, when I financed my new car loan several months ago the loan officer included gap insurance for around $600 for the 5-year term. The next day I checked with my car insurance company (Safeco) and they offered basically the same thing for around $6 every 6 months. They call it new vehicle replacement. I canceled the gap insurance through the finance company.

care511

We leased a Silverado and my brother totalled it. We have Gap insurance but they won't are trying to make us pay the OVER milage fee. We were going to purchase this vehicle after the lease but they say they don't care. What do you think?

care511

What do you think of Gap insurance concerning this: We leased a Chevy Silverado and got the Gap insurance through GMAC. Our truck was totalled, they will cover that but they want us to cover the excess miles...We explained that we had every intention of buying the truck when the lease expired in a year. They say we have to pay miles. How is that?

joel0622

Yes, you still have to pay the mileage charge. Your GAP policy on a lease is designed to cover the truck within the limits of the contract. If the contract allowed for 15K per year and you drove over that you pay the milage charge.

jforjames

That seems crazy to me. The only reason to have an overmileage charge in the lease contract is to protect the lessor (GMAC in this case) from a losing money on the resale value of a leased vehicle that has been turned in by the lessee at the end of the contract. If the vehicle is totaled, and gap paid off the balance owed, the overmileage on the unit doesn't (or shouldn't) come into play at all. The only thing I can think of is that your primary carrier paid a little less ACV because of high mileage, and GMAC is self insuring the gap risk. So now they want to take that little less that primary paid out of your hide. But if the gap waiver agreement with GMAC says it pays the difference between what your primary auto carrier paid and the net lease balance owed to GMAC at the time of the loss, which is what it should say/do, then all that is owed GMAC should be paid off. Overmileage is meaningless.

joel0622

The high miles cause the truck to be worth less, in turn the insurance company is paying out less on the claim which causes the GAP claim to be higher which is money right of GMAC's pockets.

eswan87

Just a word to the wise. Before you assume that a "cheaper" gap policy is better from your insurance company or bank or credit union, bear this in mind: Read the terms of the policy. I have seen that most policies offered by credit unions and insurance companies only cover a gap up to 100%-110% of NADA retail value of your car, which may not be near enough to cover if you have negative equity, so you may still be on the hook for thousands. Also, if you have a deductible on your auto insurance you will probably still have to pay it. Gap policies offered thru most dealers can cost a little more, but will often cover up to 150% of NADA retail and most will cover your deductible as well. Price is not everything.
Look at the coverage closely, there is a big difference.

jagar100

Hypothetical Scenario:
I'm trading my car in for a brand new car. I'm upside down so they tack on $8000 to the new finance contract, in addition to the new car that I'm financing for $25,000. I purchase Gap. I drive off the lot and total it. Is the Gap going to pay $25,000 PLUS the $8000????

joel0622

No GAP is going to pay the difference between what your insurance company pays and what the pay off is.

In your scenario it sounds like the GAP would be around $12K and yes a Ford GAP Policy would pay it plus your deductible.