GAP insurance is a type of coverage that pays the difference between the actual cash value of a vehicle and the amount owed on the loan. If you cancel your GAP policy early, you may be eligible for a refund. The amount of the refund will depend on how you paid for the policy and your state's laws. You'll only get a reimbursement for GAP insurance that you haven't used.
For instance, if you terminate your policy after three months of coverage, you'll only receive a refund for the remaining nine months (if you paid for one year of coverage). The amount of your refund is based on how you pay your insurance bill. You can get a refund from term insurance for unused premiums if you paid for coverage in advance and then canceled it early. If you cancel within 30 days of the start date of the policy, you may be able to get a full refund, less cancellation fees.
In other cases, only a partial refund may be possible. The details will depend on your policy and your state's laws. No, you cannot receive insurance reimbursement for additional expenses if your vehicle is destroyed in a covered accident or if it is stolen and never recovered. Even if you totaled your vehicle during the first month of ownership, there are no refunds available at that time.
At this point, if necessary, the provisional insurance policy would pay for everything that was left of your loan after the insurance was liquidated. To calculate the amount of reimbursement you will receive if you paid for the GAP policy in advance, divide the total cost of insurance by the number of months you were covered, which gives you your monthly premium. If you pay off your vehicle loan early, you may be entitled to a refund for the GAP insurance you paid in advance. Your insurance company must reimburse you for the unused premiums that were paid on your policy.
If you cancel your GAP policy early, you'll receive a refund from GAP insurance that will reimburse you for a portion of the unused premiums. A car dealer or finance company will include GAP coverage in your monthly payments to ensure that you can repay the auto loan in any situation. If you have an accident with your new vehicle, your insurance provider may pay you less than you owe for the vehicle. If you paid for GAP insurance at a dealership and then decide to buy a GAP policy from your auto insurance company, the dealer may reimburse you for your GAP insurance reimbursement if you provide them with proof of your coverage.
Once your loan balance is lower than the actual cash value of the vehicle, you can cancel your provisional insurance. Once you have reached the end of your lease or financing agreement, you can complete your GAP insurance payments. If you cancel car insurance, you can get a refund, but otherwise, you won't get any of that money. Some insurance companies may also require an odometer check showing the car's mileage, which can be obtained from a dealer before selling or redeeming the vehicle.
The only time when no reimbursement is available is once your policy has expired or if your vehicle is wrecked or stolen.
