Total-loss loan gap
Portfolio GAP
Guaranteed Asset Protection may help pay an eligible difference between what you owe on your loan and what your insurer pays after a qualifying total loss or theft.
When a financed vehicle is totaled or stolen, auto insurance generally pays the vehicle's actual cash value — not what you still owe. Early in a loan, the balance can be higher than that value. GAP is designed for that difference, subject to the contract's limits and exclusions.
Coverage basics
What it is for
An eligible shortfall between the loan balance and the primary insurance settlement after a qualifying total loss or theft, as defined in the GAP contract.
A simple illustration
If you owe more on the loan than the insurer's settlement, the remaining balance is the gap. GAP may cover an eligible portion of that amount. Items such as late fees, past-due payments, add-on products rolled into the loan, or your insurance deductible may be treated differently — the contract defines what counts.
When it matters most
- Small down payments
- Longer loan terms
- Negative equity rolled into the loan
- Vehicles that lose value quickly
Exclusions & limits
Check your contract for:
- Which loan amounts and loan-to-value limits apply?
- Is there a maximum benefit, and is your insurance deductible included?
- What is excluded — for example late fees, missed payments, or add-ons rolled into the loan?
- Do you already have GAP-like protection from your lender or insurer (loan/lease payoff coverage)?
- What documents are required to file a claim?
The applicable contract for your state and vehicle controls. You can request it before you choose.
Eligibility & existing coverage
- GAP applies to financed vehicles; it is typically purchased with the loan.
- You must keep primary auto insurance on the vehicle; GAP works alongside it, not instead of it.
- Eligibility can depend on the lender, loan amount, loan-to-value and state.
How claims work
A GAP claim follows the insurance settlement. In general:
- Report the total loss or theft to your insurance company first.
- Once the insurer settles, gather the settlement statement, loan payoff and payment history the contract requires.
- Submit the GAP claim within the time limit the contract sets.
- If approved, the eligible benefit is usually paid toward the loan; the contract states how.
Contact VirtualCarHub for the applicable claims instructions.
Frequently asked questions
How is GAP different from auto insurance?
Auto insurance pays for the vehicle according to your policy, usually its actual cash value. GAP addresses an eligible difference between that payout and your loan balance. They cover different things and work together.
Does everyone need GAP?
No. It matters most when you owe more than the vehicle is worth. A larger down payment or a shorter loan can reduce or remove the gap. Compare with any coverage your insurer or lender already provides.
Can I cancel GAP?
Many contracts allow cancellation, sometimes with a prorated refund, for example when the loan is paid off early. Cancellation terms are set by the contract and state law.