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Gap Insurance Refunds

car insurance paperwork with car key

State law requires that you purchase liability insurance coverage for your new Hyundai vehicle. In addition, many lenders require that you purchase collision and comprehensive coverage. You may also choose to purchase optional coverage like gap insurance, which kicks in if you’re involved in a collision while owing more than your car is worth.

All of that can add up, but you’ll receive a gap insurance refund if you pay off your car loan early. So how does a gap insurance refund work? In the guide below from the Voss Hyundai finance center, we’ll take a closer look at gap insurance refunds and how they work for Centerville drivers like you.

What is Gap Insurance?

All vehicles begin to experience depreciation, or a drop in cash value, the moment you drive off the lot. As a result, it’s possible to owe more on your car than it is actually worth until you make some headway paying off your loan. If your vehicle is totalled in a collision during this period, your insurance will only pay out the vehicle’s current cash value, not what you owe on your loan. With gap insurance, you won’t have to pay the difference out-of-pocket.

How Does a Gap Insurance Refund Work?

You can get a portion of your gap insurance policy back after you finish paying off your loan. Keep in mind that a refund is only possible in certain circumstances, and how a gap insurance refund works will depend on several factors:

  • You’ll need to pay for your gap insurance policy up-front in order to claim a refund later.
  • To claim a gap insurance refund, contact your insurance provider with documentation that your car has been traded in, sold, or paid off early.

Gap Insurance Cancellation

Even if you don’t pay off your car loan early, you may be able to receive a small gap insurance refund by canceling your policy early. After contacting your provider to get the cancellation process underway, you’ll need to submit the following paperwork:

  • Gap insurance cancelation forms
  • Copy of an odometer disclosure statement
  • Copy of auto loan payoff showing the date your vehicle was paid off

Once these are submitted and processed by the provider, Miamisburg drivers will be entitled to a gap insurance refund for the unused portion of the policy.

Rely on Voss Hyundai for Expert Auto Finance Tips in Dayton 

Wondering how to qualify for a car loan? The auto finance experts at Voss Hyundai are happy to speak with you and offer expert car-buying advice. Visit us near Kettering or use our online buying tool to calculate your monthly budget. Contact us today to learn more!

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