Is Kia Gap Insurance Worth It?
Kia Guaranteed Asset Protection (GAP) insurance offers one significant advantage for newer vehicles, but it’s also more expensive. Find out more here!
Written by Jasmine Kanter
Reviewed by Alita Dark
Unlike most manufacturers, Kia’s
GAP insurance
pays the difference between a total loss payout and your car’s original purchase price, but only if it’s less than three years old.GAP insurance makes sense, especially when you consider how quickly a new car can depreciate. Therefore, the question is not whether you should buy a policy but where you should buy it from. With Kia Guaranteed Asset Protection (GAP) insurance, you get more perks than with most other car makers, but it's still more expensive than a third-party product. We'll go into more detail below.
How does Kia GAP insurance work?
Signing a
car loan from Kia
means you promise to repay all the money you’ve borrowed, no matter what. You’re responsible for the debt even if your car is stolen or wrecked… or the total loss payout—which matches your car’s actual cash value (ACV)
—isn't enough to cover your unpaid loan.Let's say you buy a brand-new
Kia Telluride EX
for $45,000 with a five-year financing plan. During its third year on the road, your car meets a tragic fate, struck by a meteor. Thankfully, no one was injured, but now you have to figure out how to repay the $18,000 you still owe. On average, cars depreciate 15-25% a year. The more you drive it or the less you maintain it, the faster your vehicle loses value. At worst, your three-year-old Telluride might be worth a meager $11,250. So who pays the $6,750 difference? You do, of course—unless you have GAP insurance.
Kia’s GAP insurance policy pays the difference between your vehicle’s ACV and your remaining loan at a minimum (more on that later). It also comes with the following perks:
- Up to $50,000 of covered losses
- Up to $1,000 of covered primary insurance deductibles
- The option to add the cost of GAP insurance to your financing agreement
- The option to add GAP insurance on loans up to 84 months long
What’s interesting is how Kia sets itself apart with its repayment scheme for contracts lasting 36 months or less. The owners of short-term loans are eligible for the difference between their insurance provider's total loss payout and the vehicle's original purchase price. If you're considering a high-end trim, this presents an excellent opportunity to protect one of your biggest assets from depreciation.
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How much does Kia gap insurance cost?
Your Kia GAP insurance premium depends on how much you borrow, the size of your interest rate, and the length of your loan. Expect to pay between $500 and $700. Remember, you'll need to pay interest if it's part of your financing agreement!
Kia gap insurance vs. the competition
Kia GAP insurance is more generous than other car makers’ policies, but it’s still a lot more expensive than buying it through a third party. If you already have a
car insurance
policy with a major company like Travelers
, Liberty Mutual
, or Farmers
, adding GAP insurance is extremely affordable. Here’s a comparison:Kia Motor Finance Guaranteed Asset Protection | GAP insurance from your existing provider |
|---|---|
Only available at the time of financing | Available as long as:
|
$500 to $700 flat rate | $20 to $40 per year |
Cancellation only during the grace period | Cancel anytime |
Interest applies | Interest does not apply |
Limited refunds | Refunds are standard |
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Do you need gap insurance?
Due to the company's tendency to use cheap materials,
Kia's depreciation rates are high
. Your car is likely to lose value faster than you can pay it off, especially if your payments extend over a long period. At that point, you’ll owe more than what your vehicle is worth, also known as being underwater or upside-down.To see if you need GAP insurance, research your favorite model’s rate of depreciation and consider:
- The size of your down payment: Down payments are interest-free and made before your car even starts to depreciate. Consider GAP insurance if you can't pay at least 20% up front.
- The length of your loan: Despite having the most affordable payments, long-term loans also have the greatest risk of going underwater or upside-down. Some cars depreciate by as much as 15% the moment you drive them off the lot!
- How much you drive: If you drive a lot or skip regular maintenance, you can depreciate your car yourself. Keeping your vehicle in good condition will keep its value high.
If you leased a Kia,
your agreement already includes GAP insurance
. Check your paperwork for coverage specifics. How to cancel Kia gap insurance
To receive a full refund for Kia GAP insurance, you’ll need to cancel within 60 days. Contact your local dealership or
Kia Finance America
(1-866-331-5632) to request cancellation. You won't be able to get a full refund if you've missed the grace period. At best, you might be able to get a prorated refund of the lump sum you paid up front. Monthly GAP insurance payments, however, cannot be refunded.
What is the Kia gap insurance refund process?
To request a refund for Kia GAP insurance, contact the dealership where you bought your vehicle or call Kia Finance America at 1-866-331-5632. You may be required to sign a cancellation form or odometer statement before proceeding.
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