Understanding Guaranteed Asset Protection

When you drive a new car off the lot, its value begins to depreciate almost immediately. If you find yourself in an accident and your car is totaled or stolen, your standard auto insurance policy will only cover the current market value of the vehicle, not the amount you still owe on your loan or lease. This is where GAP steps in. Let’s shift gears and explore what GAP is and its benefits.

What is GAP?

GAP, or Guaranteed Asset Protection, is an additional auto insurance coverage that helps cover the “gap” between what you owe on your loan and what your auto insurance will cover. Essentially, it ensures you are not left with a significant financial burden if your car is stolen or deemed a total loss after an accident.

Benefits of GAP Protection

• Financial Security: GAP Protection safeguards you for what your auto insurance may not cover. This can be a substantial amount, especially in the first few years of ownership when depreciation is steep.
• Peace of Mind: Knowing that you won’t be left owing money on a car you can no longer drive provides peace of mind. This is particularly reassuring for those with long loan terms or small down payments.
• Reduced Shortfall: GAP may reduce or eliminate the shortfall in the event your vehicle is deemed a total loss.
• GAP Plus Advantage: GAP Plus can help reduce your next loan at Interior Federal by $1,000, if you finance your new vehicle with us, making it easier to get the replacement vehicle you’ll need.

By covering the difference between what you owe on your car and its current market value, GAP ensures you aren’t left with an unpaid loan on a car you no longer have. If you’re in the market for a new car or currently financing one, consider adding GAP to your new loan or insurance plan. It’s a small investment that can make a big difference when you need it most.

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