Don’t Pay for a Car You Can’t Drive Anymore.
If your vehicle is totaled or stolen, Guaranteed Asset Protection (GAP) insurance will pay the difference between how much your vehicle is really worth (actual cash value) and what you have left to pay (outstanding balance) on your loan or lease.
How Much Does GAP Insurance Protect?
Here's a hypothetical example to demonstrate how much you're insuring when you purchase GAP insurance for a vehicle you already drive (keep in mind that this is only an example and is not being presented as terms of any actual plan).
Example: How GAP Works
Let's say your total remaining loan balance is $15,000. That's how much you still owe your creditor for the car you already drive. If you were to get in an accident, you might receive a $10,000 payout from insurance to replace your damaged car because of its depreciated value.
Even with auto insurance, your remaining balance you'd still owe to your car loan creditor would be $5,000.
$15,000 (loan balance) - $10,000 (insurance claim) = $5,000 (GAP coverage)
This is where Guaranteed Asset Protection can save you thousands. Your GAP plan would cover the remaining balance of your loan, in this pretend example, that's $5,000 you get covered.
What’s the Total Payout after a Crash?
Consider the example above. Depending on how much your car is worth, what your remaining loan balance is, and how much (if anything) your current auto insurance will cover if you get in a crash, you could save money in the long run.
Essentially, if you spend $299 on protection, you get out of paying $5,000 or more for a car you can't drive due to an accident.
Is It Worth It If I’m a Safe Driver?
In short, yes. If you drive often, for your weekday commute or for long trips, you'd end up saving money on your car loan by purchasing Guaranteed Asset Protection on your car due to the higher probability of an accident. Similarly, remember that if your car is a luxury vehicle or brand new, the depreciation could be even greater.
Serving All the Heroes in Our Community with Better Banking
Whether you want to start building credit, or start growing your savings, your assets, or your family, MCU has a variety of products with competitive rates, member-friendly terms, and the tools you need to build an exceptional financial future.
Get the Most Out of Your MCU Membership.
Membership in our community is about more than just banking. As an MCU member, you can access valuable information and resources to help you plan and reach your financial goals.