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What can I do if primary insurancer pays my total loss claim, but my GAP provider denied my total loss claim? Vehicle still has a balance on car loan
What can I do if my primary insurancer paid my total loss claim an my vehicle, but the GAP Deficiency Wavier Addendum claim was denied because of an exclusion in my GAP contract. The person driving my car had a suspended license so GAP stated that it's considered an illegal act. Involved in hit-run
Emily Maracle · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
I’m sorry to hear about your car! I hope no one was hurt.
Since you currently have a car loan, you likely had
collision coverage
and comprehensive coverage
, meaning you’d get a payout from your insurance even if the driver of your vehicle was at fault. That said, if your
gap insurance
provider is stating you don’t have coverage due to an exclusion in the policy, you, unfortunately, don’t have many options. The first thing you’ll want to do is review your gap insurance contract. It likely came with your original car loan documents or finance agreement. You’ll want to review your policy’s terms and conditions to confirm this situation is actually excluded.
Even if you find the clause where your situation or illegal acts are excluded, you can attempt to write a letter of appeal. In it, you’ll want to explain why you feel your claim deserves approval. You’ll want to include any information or documents regarding the accident, like a police report or the approved claim from your
car insurance
company. If your gap provider still denies your claim, you have the option to visit a lawyer to determine if you have any other options. Claims lawyers typically offer free consultations to review a case and decide whether it’s worth pursuing.
Finally, check the amount of your claim payout. Your gap provider could have denied your claim because your insurance payout will cover your remaining loan balance.
Should your claim still be denied by your gap insurance company and you owe money on your loan, you have a few options. You can:
- Keep making your loan payments
- Pay off the balance in one lump sum
- Roll your current loan into a new loan for a new car
I hope everything works out!
View full answer
- Gregory R.
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