Showing results for 
Search instead for 
Did you mean: 

Questions about GAP Insurance

Frequent Contributor

Questions about GAP Insurance

Do I even need gap?


And if so, will the bank that is financing me force me to get it at signing?


Can I just wait till after I buy it to ensure the dealer has one less way to finagle money out of me?

Message 1 of 6
Established Contributor

Re: Questions about GAP Insurance

I would get it


unfortunately I have had to use it twice in my lifetime


when I was 19, I bought a brand new car.  And was hit head on 2 weeks later (their fault, charged)

total write off. I would have lost approx $2k in 2 weeks, and wouldn’t have been able to replace it with the same model ( I was stretched to buy the model I got).  


May 2018 I bought a 2015 off a lease.  In Feb of this year the lithium battery smoldered and totaled the car.  That would have been a $5k loss at least.  Possibly more.   Instead I walked away without a car or any remaining payments. 


So I had motorbikes and Cars in  between where I paid for GAP and “lost” money. But overall I am ahead


also, if you pay the vehicle off early, you get a refund on the gap. I have done this 3 times. 

Plan for the worst, hope for the best

July 31/2019. EX-712. EQ-704. TU-726
Dec 16/2019. EX. 721. EQ. 723. TU 746
Aug 8/2020 EX. 728 EQ. 714 TU 744
Sept 18/2020 EX. 728 EQ. 726 TU 752
Inq. EX 6 EQ 4 TU 2 - - CC 5x24, 1x12
Amex BCP $20k - Apple GS $15k - BMW/Elan $5k - Cap1 QS $16.7k - Chase Amazon $13.6k - Chase United Club Infinite $20k - Citi DC $14.5k - CreditUnion1 $9k - DiscoverIT $20.5k - HSBC Gold - $10.5k - Wells Sig Visa $12k
Message 2 of 6
Frequent Contributor

Re: Questions about GAP Insurance

Gap is generally cheap enough $299 one time fee through my credit unions that it's a must if you will be upside down on the car. Few things hurt more than a car being stolen or totalled but you still owe thousands.
Message 3 of 6

Re: Questions about GAP Insurance

@ando35 I would say that unless you're putting a substantial amount of money down and plan to either aggressively pay your vehicle off AND keep it in relatively nice condition then GAP is a must.  It's cheap enough and with the way cars depreciate you don't want to ever find yourself needing it and not having it.  


There are many things I would skip at the dealership but GAP isn't one of them and I'm a former F&I Manager that worked at a very large auto network here in the midwest.   Nothing worse than having to buy a new car while paying off the balance of another....and that's even if you can get approved for technically a second auto loan. 


GAP doesn't usually tend to cost more than $599 (if so, haggle with the F&I guy) and it'll be the best money you ever spend in the event of a total loss.  

Message 4 of 6
Established Member

Re: Questions about GAP Insurance

The bank can't force you to buy GAP. I recommend it if:


  • Your down payment will be less than 20% of your total loan.
  • You drive more than 15,000 miles/year.
  • Your loan amount is greater than the value of your car because you're financing your fees, taxes, negative equity/rollover balance from an older car loan, a vehicle service contract, or other items.
  • You're buying a vehicle that is likely to depreciate more quickly than the average.
  • Your loan term will be 60 months or longer.

As others have said, if you're getting your loan from a credit union, they often sell GAP at cost (around $300). 

Message 5 of 6
Frequent Contributor

Re: Questions about GAP Insurance

GAP is at the dealership and it can be costly
You can also ask your own Ins company...

They also provide “Total Loss Coverage” also known as GAP so put a little call into your ins company for some TLC and don’t fall into the GAP (throwback slogan for the GAP clothing store 😆)

2018 Dec Starting Score: 700
Current Score: 778
Achieved Goal Score 2020: 800

Take the myFICO Fitness Challenge

Message 6 of 6
Advertiser Disclosure: The offers that appear on this site are from third party advertisers from whom FICO receives compensation.