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Guaranteed Asset Protection Insurance (GAP)
What Is GAP?
GAP covers the borrower’s responsibility for the difference between
the outstanding loan or lease balance and the insurance settlement for
a totaled or stolen vehicle.
You can sell GAP to your customers in one of two ways, depending on state
regulations:
- As an insurance policy
- As a Deficiency Waiver backed by a Contractual Liability Policy (CLIP)
Both are underwritten by the Assurant Solutions companies: American Bankers
Insurance Company of Florida and American Security Insurance Company.
Assurant Solutions companies are leading providers of specialty insurance
products and services marketed nationally and internationally.
Your Customer Benefits:
- Pays the difference between the insurance settlement and the loan
or lease balance up to the policy/waiver maximum
- Frees the customer from having to make payments on a vehicle he or
she no longer owns or uses
- Also frees the customer to replace property lost due to an accident
or theft more quickly
Your Dealership Benefits:
- An easy sell. In today’s economic environment with more
people taking advantage of low- and no down payment loans, the demand
for GAP is stronger than ever
- Earns extra income. Example: If you sell 75 vehicles a month
(900 annually) and earn $225 or more per contract, you could earn an
extra $50,625 of F&I profit annually
- Builds relationships. Providing your customers with value-added
products builds strong customer relationships that translate into customer
loyalty and encourage repeat business
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