Guaranteed Asset Protection

In today’s automobile market, a vehicle begins to depreciate the minute it is purchased. Because of this, a vehicle’s outstanding loan balance is typically higher than its actual cash value, especially during the first few years of the loan.

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When a vehicle is totaled or stolen, the borrower’s insurance settlement generally is based on the actual cash value of the vehicle. Because of the way the claim is typically calculated, the settlement can be significantly less than the remaining loan balance. This may create a deficiency balance or a “gap” resulting in a serious financial hardship for your borrower.

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The “gap” may even jeopardize repayment of the loan. Our Guaranteed Asset Protection (GAP) program will help protect your new or used vehicle investment, avoid a serious financial loss, and help assure that the loan is paid. This program also includes GAP Advantage and Auto Deducible Reimbursement coverage:

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GAP Advantage Coverage

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GAP Advantage Benefit With the GAP Advantage benefit, if a borrower experiences a total loss, they will be eligible to receive an additional $1,000 towards the financing of a replacement vehicle with your institution. This $1,000 benefit will be applied as a credit to the new vehicle loan. To be eligible, the borrower must finance a replacement vehicle with your institution within 90 days from the date the covered collateral is deemed to be a total loss (the primary carrier’s settlement) and the claim must be filed within 95 days. If the borrower’s primary insurance settlement pays off the original loan balance in full, your borrower is still eligible for this benefit provided that the same conditions mentioned above are met.

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Auto Deductible Reimbursement

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If the member suffers a loss during the benefit period which is covered by the member’s Auto Insurance Policy, the member may be entitled to reimbursement of the Auto Insurance Policy deductible amount up to $500 per loss. To be eligible for reimbursement the member must own or lease and insure the covered auto under an Auto Insurance Policy designating the member as the named insured.

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