Things You Will Need for Your Application

Below is a checklist of some of the information and documentation you may need to supply for your car loan application or at Car Loan settlement.

Simply put, it keeps you from being financially ruined when disaster hits your car.

Who Does Gap Insurance Suit?

Gap Insurance is suitable for customers who finance a motor vehicle and want peace of mind and protection from financial exposure that may occur should their vehicle be stolen or written off.

Benefits of Gap Insurance

• Reduces or eliminates your financial exposure to a shortfall between the insurance payout and the outstanding balance on the loan. * Depending on the cover taken out
• Provides added protection for your credit rating in the event of the total loss.
• Includes an additional benefit that can provide a one off payment additional payment for any other expenses incurred.
• The premium covers you for the full term of the loan to a maximum of five years.

Understanding Gap Insurance

All of us are accustomed to the concept of insuring our valuable assets against loss and damage: Home & contents insurance and comprehensive motor vehicle insurance are typical insurance products

However, not everyone is aware that there is the potential for a financial loss if their car is written off while under finance and a shortfall occurs between the insurance payout and amount still owing on the finance - despite the fact that the car is covered by comprehensive motor vehicle insurance.

Gap Insurance is protection against this potential shortfall. It helps by paying the difference (the Gap) between your finance payout and the insured value of your vehicle if it is written off.

If your vehicle is written off while it is under finance, your financier will require you to pay out the balance outstanding and unpaid on the finance contract.

How does a shortfall occur?

In a Total Loss situation, your insurance company will compensate you for the loss of your vehicle by paying you the vehicle's current market value of the car (as determined by them), or an agreed value (if you have an agreed value policy).

Unfortunately, the amount paid to you by the insurance company is often less than the amount required to pay out the finance. This is the shortfall amount.

This shortfall can occur for a number of reasons, but is often due to the fact that a car's market value declines faster than the finance on the car is paid back in the initial years after the finance commenced for the first few years of its life.

If Gap Insurance is of interest to you for your Car Loan and this is for a Car Loan Australia Wide Carloansales can help you.