Gap Insurance Refunds

Many Phoenix and Chandler drivers opt for gap insurance for added peace of mind. Did you know that if you pay your car loan off early, you may be able to receive a gap insurance refund? While a refund is not available for your required liability coverage, it is possible to get a refund on your gap insurance policy. How does a gap insurance refund work? Bill Luke Tempe has all of the details.

Gap Insurance Basics

As soon as your new vehicle leaves the lot, it already starts depreciating. Because new cars experience rapid depreciation, there could be a period of time when you owe more on your vehicle than it is worth. If you are involved in a collision during this time or your vehicle is seriously damaged in another way, you could end up owing money on an auto loan for a vehicle you can no longer drive. Gap insurance takes care of the difference between what you owe and what the vehicle was worth at the time it sustained serious damage.

How Does a Gap Insurance Refund Work?

You may be able to receive a gap insurance refund once your vehicle is paid off in Queen Creek. While you won’t get a full refund on your gap insurance policy, you can get a portion back. How does a gap insurance refund work? It depends on how you pay off your loan:

• Lump Sum Payment: You are entitled to a refund on the unused portion.
• Monthly Payments: If you pay your premiums monthly, you cannot receive a gap insurance refund on any past months. If you cancel early in the month, you will likely get a small refund.

How to Cancel Gap Insurance

When you want to cancel your coverage, contact your gap insurance provider to begin the cancellation process. You will need to provide the following:

• Gap insurance cancellation forms
• Copy of an odometer disclosure statement
• Copy of auto loan payoff showing the date your vehicle was paid off

Contact Bill Luke Tempe for Additional Details

If you have any questions about vehicle insurance, do not hesitate to speak to the experts at Bill Luke Tempe. We know insurance can seem a bit overwhelming, and we are here to discuss any concerns you may have. If you would like to know more about the cost of gap insurance or its benefits, get in touch with us today.