GAP insurance

I know this won't help you too much, however, your thread conjured my interest and I researched Gap insurance. I don't have a Prius yet, however, that will change around the June time frame. Although I live in the SE region, I simply plan to add Gap insurance to the comprehensive policy I'll be taking out from Allstate ... my insurance company for the last 15 years.

Again, thanks for posting something I didn't even know about!

Peace!

 

I opted to not get the gap insurance, but while we're on the topic, I'm curious about the reasoning behind the decision to get it.

My reasoning went like this:

* Gap insurance covers the difference between the outstanding loan balance and the insurance-company-decided (typically blue book) value of the car.

* Short-term resale values for the Prius are exceptionally high.

* The gap is small, even for people who finance almost everything, like I did. (If Prii are really selling used over MSRP, it is in fact negative.)

* Such a tiny gap means a tiny risk, and isn't worth the cost of the insurance.

Did I have something wrong here? Of course, as the supply side starts to catch up with demand, resale values will drop, and the above argument no longer stands. Nine months ago, though, this seemed right to me, and the outstanding balance on my loan is already well below blue-book.

Thoughts?
Brad

 

We decided against GAP. However, when we added the Prius to our Progressive policy, we were told they didn't even offer GAP for the Prius!

Must be because of Brad's reasoning, which is also pretty much why we decided against GAP.

I don't know who Toyota Financial uses. Have you tried their website? I think you can enter in your loan account number and check on status and such, maybe the info is on there. I haven't seen the online service myself since my first payment isn't due until September. But hey, just thought I'd toss the idea out there.

Good luck!

 

Hey DanMan,

I actually bought the GAP insurance back in december when I got the car. Soon enough I realized the 500 dollars were not worth it and decided to cancel expecting a full refund since it was within 30 days of purchase.
Well, it took me 4 months!!, yes, 4 months to get the money back. I am located in Massachusetts and I would never ever recomend anybody to go through IRA Toyota. Their financial department staff doesn't have any respect for their customers. After a purchase of that magnitude for god's sake you deserve to be treated right.
The money goes from the insurance company to the dealer and from them to Toyota financial if you financed through them.
The name of the Insurance company I don't recall exacly, something like "JM&A" I think.

 

I've got GAP.

Had never heard of it before and didn't have it on my previous three cars but got it for this one.

I bought the GAP when I financed my loan through my Credit Union. They provided the GAP. Don't remember how much it was but I did get a four year loan at 4.74% and the GAP is part of it.

I didn't finance the extended warranty. Bought that straight out for cash from Troy.

The reason I went with the GAP was in case the car got totaled before the loan was paid off. Sure, the car may retain it's value now, but in four years I think the depreciation will be greater than the cost of the GAP.

It's just another peace of mind thing.

 

Got Loan/Lease Payoff from Progressive on my policy for $13/6 mos. Pays maximum 25% additional of book value (vs. "GAP" which pays full loan value) but FAR FAR cheaper than what Toyota tried to sell me. Plus, when the loan payoff amount goes below book value in a couple years, I can cancel the coverage and don't have to pay for the full term of the loan.

Loan came to almost $30K, including incredible 8.75% chicago tax, warranty, so even a used Prius with no depreciation, I'm down $3K right out the door.

 

My gap insurance was part of the purchase of the vehicle, and was wrapped up in the financing through Toyota Financial. I got gap as I had to dump $4k in negative equity for the lemon Saturn that I traded in on the Prius, as well as financed TT&L, making the total loan some $6k more than the price of the car. Even with almost 48k miles on the car, It is still listing within $600 of what I originally paid for the car, so I'm quickly paying off the negative equity on this car. I may review the need for gap again as I pay down the note.

If my house sells, I just may cancel the gap policy, right before paying off the car.

 

Gap insurance was free with USAA when I purchased the vehicle. They matched Toyota's 4.2% financing but Toyota wanted about $15 extra a month for Gap insurance.

 

i got Cap. waiste of money for me. i don't even use my normal insurence to it's fullest. if i actually cave in and get little things fixed like the dents and scratches, i'm sure my insurance could help me.. but nah. it's not cheap either.

my charge was 2500 extra at purchase. something like that.

 

Does anyone know if Umbrella coverage covers GAP situations on cars? I'm thinking of getting it anyway but this would be a clincher.

 

You will have to read the policy. Gap insurance makes sense only when you are upside down in the loan. If you are going to be upside down then buying the car isn't the best course of action.

 

It's never good to be upside down in a car, financially or otherwise.

Tom

 

Check with your own insurance about gap insurance. We have Erie and it's only eith $9 or 19 a month and you can take it off when ever you want.