Auto Loan GAP Coverage Need

Check whether you still need guaranteed asset protection (GAP) coverage by comparing your auto loan payoff with the vehicle's actual cash value. The calculator subtracts the deductible and any partial reimbursement limits to reveal the potential shortfall and the annual cost of carrying GAP insurance at a dealer-style rate.

Outstanding principal plus any payoff fees owed to the lender.
What your insurer would value the car at the time of a total loss.
Defaults to 100% of ACV before deductible when left blank.
Defaults to $500 if blank to reflect a common deductible.
Defaults to 1.2% of covered gap to approximate dealer GAP pricing.

Examples

  • $32,500 payoff vs. $27,400 ACV, 100% payout, $500 deductible ⇒ Expected payout $26,900.00, GAP exposure $5,600.00, annual coverage cost $67.20.
  • $18,900 payoff vs. $22,000 ACV, 95% payout, $1,000 deductible ⇒ Insurer pays $19,900.00, GAP exposure $0.00, so coverage is not needed.

FAQ

Should I include negative equity from a prior trade-in?

Yes. Add any rolled-in balance to the payoff amount so the calculator captures the true liability that would still be owed after a total loss.

How accurate is the vehicle value input?

Use your insurer's ACV methodology, recent comparable sales, or online valuation tools. The closer you are to the actual settlement number, the more reliable the gap estimate will be.

What if my loan balance drops faster than depreciation?

Re-run the calculator after each payment milestone. Once the gap turns negative, you can cancel GAP coverage or stop paying for it through your loan.

Additional Information

  • Insurer payout defaults to the full actual cash value before the deductible, but you can reduce the percentage to simulate salvage adjustments.
  • Dealer and lender GAP products often price coverage as 1–2% of the amount protected per year; adjust the fee percentage if you have a quote.
  • If the calculated gap is zero, your equity covers the deductible and you can usually waive GAP coverage to save premiums.

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