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Why would late payments affect the amount I'm receiving from my gap insurance?
I purchased my vehicle for $19,000. I still owed $16,000 on my loan when the car was totaled. My insurance paid out $11,000. I have gap insurance, but they said they will only pay out $3,500 due to late payments on my loan. How can I get them to pay the full amount?
Emily Maracle · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
“When you sign a finance agreement for a vehicle, you are also agreeing to the terms and conditions of the loan. Unfortunately, since you made late payments and incurred fees and interest from those payments, your
gap insurance
isn’t required to pay those fees.You can reach out to your lender to get an exact understanding of how your late payments affect your final balance. If the total does equal the remaining $1,500 left on your loan after your gap insurance payment, you’ll be required to pay that out of pocket.
If there is a discrepancy and you can provide proof, you may be able to negotiate with the gap insurance company.
While this is a stressful situation, the best thing you can do is reach out to your lender and get clarification. In the future, you’ll at least know how late payments can affect your gap insurance claim.
“
View full answer
- Gregory R.
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