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Gap Insurance for Trucks

Posted by David Ross on Sat, Apr 19, 2025

We offer truck insurance in Philadelphia, Pittsburgh, Erie, Reading, Lancaster, Allentown, and all over PA.

Gap insurance is a specialized, optional truck insurance coverage that protects truck owners from financial loss if their vehicle is totaled or stolen. It covers the difference between the truck's depreciated value and the remaining amount on the loan or lease, ensuring peace of mind and financial security.

What is Gap Insurance for Commercial Truck Buyers?  

Gap insurance, or Guaranteed Asset Protection insurance, protects commercial truck buyers if their truck is totaled or stolen. When an incident occurs, your standard truck insurance typically covers the vehicle's current market value—not the amount you still owe on your loan or lease. This "gap" between what you owe, and the insurance payout, can leave you with a significant financial burden.  

Gap insurance covers this difference, ensuring you don't have to pay out of pocket for a truck you no longer have. It's an essential safety net for truck buyers, especially those financing or leasing expensive commercial vehicles. Adding gap insurance to your policy can provide peace of mind and safeguard financial stability.

Benefits of Gap Insurance

Gap insurance offers several key benefits to truck owners, particularly those with new or leased vehicles. One of the main advantages is financial protection. In the event of a total loss or theft, standard auto insurance only covers the depreciated market value of the vehicle. Gap insurance bridges the gap between this amount and the remaining balance on your loan or lease, preventing substantial out-of-pocket expenses.

Additionally, it helps avoid negative equity situations due to rapid depreciation in a vehicle's early years of life. Gap insurance is especially valuable for those who made a small down payment or have loans with long repayment terms.

Moreover, gap insurance provides peace of mind, knowing you won't have a significant financial burden in a worst-case scenario. Gap insurance is a wise investment for maintaining economic stability and protecting assets.

How Does Gap Coverage Work for Total Losses?

Gap coverage addresses the difference between your vehicle's actual cash value (ACV) and the outstanding loan or lease balance if the car is declared a total loss. When such an incident occurs, your primary auto insurance will assess the car's market value and pay that amount. However, this amount could be less than you owe on the loan or lease due to depreciation.

Gap insurance covers this shortfall, ensuring you are not responsible for the remaining balance. For instance, if you owe $20,000 on your vehicle but the insurance provides only $15,000 based on its depreciated value, gap insurance would cover the $5,000 gap. This coverage prevents financial strain after a total loss and allows you to start over without outstanding debt.

Contact us for the Best Prices on Commercial Truck Insurance with Gap Coverage!

We are independent brokers here at American Insuring Group. Our agents shop the market for the best quality insurance rates that match your needs! Call us today at (610) 775-3848 or online for the best truck and commercial vehicle insurance rates!

Tags: truck insurance, GAP Insurance

What You Should Know About GAP Insurance for Your Car or Business

Posted by David Ross on Tue, May 14, 2013

GAP insurance refers both to Guaranteed Asset Protection and Guaranteed Auto Protection. In both cases it is designed to cover the difference (or gap) between the actual cash value of an asset and the amount still owed on the related loan or lease.  While, strictly speaking, GAP insurance may apply to any type of asset, the vast majority of GAP insurance policies are written for cars, trucks, vans, and other types of vehicles.

Why Bother With GAP Insurance?

GAP insurance advice as supplemental car or business insurance for Reading PA, Philadelphia, Lancaster, York, Harrisburg, Allentown, Pennsylvania and beyond.GAP insurance may be a wise choice in cases where a low down payment has been made, and on high-interest loans of 60 months or more. It is often offered by finance companies at time of purchase, and by auto insurance companies.  This loan scenario frequently applies to vehicle purchases, which is why the term “GAP insurance” most often refers to added insurance protection for a vehicle.

 

GAP Insurance Considerations When Buying a New Car or Other Vehicle

Cars, trucks, motorcycles and other vehicles are assets that depreciate rapidly in value. In cases where a low down payment is made on the initial purchase, it is common for the amount remaining on the loan to exceed the fair value of the car.  This is because cars often lose up to half their retail within 3 years from the purchase date, at which time the remaining loan may far exceed that amount. If your car becomes stolen or is totaled, the replacement value you receive from the insurance company may be far less than the amount remaining on the loan. In such cases a GAP insurance policy would cover the difference. If you would be unable to cover the difference without GAP insurance in such cases, or if this would represent a significant financial hardship, then GAP insurance may be right for you.

How to Get GAP Insurance for Your Vehicle

GAP insurance may be purchased from an insurance agent or through a car dealership. GAP insurance coverage is often financed as part of the loan or lease, and typically comes into play when a vehicle is subject to a total loss. Some finance companies require GAP insurance when financing a loan. 

How to Save on GAP Insurance

We suggest checking first with your independent insurance agent before signing a GAP policy related to a vehicle purchase. Your independent agent may be able to save you money by adding this coverage to your vehicle insurance policy rather than taking out a separate policy through your car dealership. To learn more about getting the right GAP Insurance for your vehicle, call us at 610-775-3848 or use the Contact Us form.

GAP Insurance for Your Business

When it comes to insuring your business “GAP insurance” refers to Guaranteed Asset Protection, and often comes in the form of a “guaranteed replacement cost” or “agreed value” insurance policy. In such cases your business property is insured for an amount that is guaranteed in advance regardless of what the market value may be at the time of your claim.  This speeds the time to settle your claim, and may help you sleep better at night.

To learn more about the many commercial insurance options for your business, call us at 610-775-3848 or use the Contact Us form.Contact Us to learn more about GAP insurance for your car or business. Serving Reading PA, Philadelphia, Lancaster, Harrisburg, York, Allentown, Bethlehem, Pennsylvania and beyond.

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