GAP insurance not paying?
i have an issue with a GAP insurance company right now. my wife totaled her car in october of 09. we owed more on the car than retail. our auto insurance paid their part, which was retail. we purchased GAP insurance from a separate company at the time we financed the vehicle. now the GAP insurer is only paying half of the remaining balance, leaving about 00 unpaid.
the reason that they are saying they are not going to pay the 00 remaining is this:
When we purchased the vehicle new we also bought an extended warranty. later during the term we decided that we didn’t want/need the extended warranty, so we cancelled it. the credit that was due to us, about 00, was then applied back to the car. in affect, that paid about 6 notes in advance, so we decided to live car note free for those 6 months.
our GAP insurer is saying that since we did not pay on the car for 6 months, and not used that 00 credit towards the principle alone, that 00 is not eligible for coverage. it does not specifically say, as far as i can understand, this in our contract we signed for the coverage.
has anyone had issues like this, or any kind of issues with GAP coverage?
mbrcatz, you misunderstood me. we did not stop making payments after the car was totalled. we sold back the extended warrenty and stopped making payments before the accident.
Tagged with: auto insurance • extended warranty • extended warrenty • gap • GAP Coverage • gap insurance • insurance • insurance company • insurer • principle • separate company • warranty
Filed under: GAP Coverage
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If you had not had GAP insurance and had not cancelled the extended warranty prior to the accident, you would have been able to cancel the warranty now and use that money to reduce the total you owe. By the same token if you had not cancelled it the GAP carrier would have had it cancelled so that the amount owed would be reduced. Or another way to look at this is that the GAP insurance is meant to assist you in covering the possibility of your being upside down in terms of financing of the "vehicle" not all the extras you decided to buy.
Sorry but the GAP insurer is correct and you need to pay the money. They are not tricking you or trying to avoid paying the claim–read the GAP insurance policy for additional information. You did have the advantage of using the vehicle payment free for 6 months now its time to pay the piper.