Vehicle total loss

If your vehicle has been declared a total loss, the settlement check must be applied against your loan on the vehicle because the insurance company is purchasing that vehicle. 

It’s important to note that if the claim is settled for less than the balance owed on the loan financing the vehicle, you will be responsible for paying the remaining balance. We always recommend to continue making payments on your loan until the claim is settled to protect your credit. 

You may be able to cancel any insurances or warranties purchased at the time you bought the vehicle, and any premium remaining might be refunded. Generally, all of these items are referred to as “add-ons.” Any refund would be pro-rated for the time remaining. Calculations for how much could be refunded are based on the terms of your original contract. If you paid late or deferred or paid partial payments, it can affect the amount of any refund you might receive. 

GAP insurance is an optional insurance you can purchase through either a dealership, the Credit Union, or your car insurance provider at the time you purchase a vehicle. GAP insurance can help offset the difference between what the cash value of the vehicle is and the amount you owe on your vehicle loan. If your down payment on the car was small (or you didn’t make a down payment at all), this may be a large financial gap you wouldn’t be prepared to cover otherwise.

While GAP may pay a large portion of the loan balance remaining after the vehicle insurance settlements and any refunds from “add-ons” have been applied to your loan, you may still have a portion of the loan balance you are responsible for paying. 

There are many variables that affect the balance left for payment. These include:

• Late payments
• Deferred payments
• Partial payments
• The number of miles on your vehicle
• Balances from prior loans rolled into the balance of the current car loan
• Balances extended past original maturity date
• Delay in submitting the GAP claim after settlement

If you purchased your GAP insurance from a dealership or another insurance provider, you will need to work with their agent to file your claim. GECU can provide any loan documents you need. If you purchased your GAP insurance from GECU directly, we will be able to assist you with filing your claim and working with an agent to get your claim settled. It’s important to know that most GAP insurances have a timeframe you must follow to qualify for payment, according to coverage. Any extended delay in settling the claim, once you have settled with your insurance company, may result in a loss of coverage for your GAP claim.