What happens if my vehicle was totaled or stolen while I was financing it, but my insurance does not cover the balance of the loan?
No one wants to deal with an accident or theft when it comes to their vehicle, and we're sorry to hear this happened to you. After you file a claim with your insurance company, they will provide you with a payoff amount to be used toward the remaining balance on your vehicle loan with the credit union.
The payoff amount will be applied to your loan. If the amount of the payoff from your insurance company does not satisfy the balance of your loan, the credit union will mail a Payoff Letter to you with the remaining balance owed on your loan. Unfortunately, even if your car is totaled or stolen, you are responsible for any outstanding balance owed after payment is received from your insurance company.
If you have Guaranteed Asset Protection (GAP) Insurance, we will automatically file a GAP Insurance claim on your behalf once payment from vehicle insurance company has been applied to your loan. Once the GAP Insurance payment has been applied, we will send you a payoff letter outlining the payout from your vehicle insurance company and the GAP Insurance payout. The letter will reflect any remaining outstanding funds due and will include a copy of the GAP Insurance Settlement Statement which will break down how the payment figure was calculated.
It is important to note that GAP Insurance does not cover your insurance deductible or any outstanding late fees.