When you pay your GAP insurance premium in advance, you are entitled to a refund of the unused portion if you pay off your vehicle early.
If you pay your GAP coverage in monthly installments, you are not entitled to a refund of any used premiums.
You may receive a small refund if you cancel early in the month.
Can you cancel your gap insurance and get a refund?
Answer: Yes, usually you can cancel gap insurance. if you determine that you no longer need it. If you just purchased the policy, depending upon your gap insurance company, it may be possible that if you cancel within a certain time period (typically 30 days) you can receive a full refund. A cancellation fee may apply.
How long does it take to get a gap insurance refund?
The insurance company will immediately cancel your insurance policy. In four to six weeks, you should receive a check in a mail for the money that you spent on your gap insurance coverage.
Does gap cover negative equity?
If the new vehicle is totaled or stolen, the dealership’s GAP policy pays the difference between cash value of the vehicle and the balance of the loan — including the negative equity on the trade-in. But sometimes insurance companies don’t cover the negative equity on the trade-in in GAP coverage, Reahard says.
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