Rv Gap Insurance: How To Purchase

RV GAP insurance is a special type of insurance that is designed to protect motorhome owners from incurring losses that go beyond the RV's value if they are still making payments on their vehicle. GAP stands for Guaranteed Asset Protection, and it covers the difference between the insurance settlement and the balance of your loan in the event of a total loss. This type of insurance can be purchased from dealerships or online retailers, and it typically covers up to $50,000 of the gap between the insurance settlement and the loan balance. It is important to note that GAP insurance is not necessary if you have already paid off your RV or have enough savings to cover the gap.

When you need it

RV GAP insurance is designed to protect motorhome owners from losses that exceed the value of their RV. It is particularly useful if you are still making payments on your RV and owe more than the RV is worth. In this case, GAP insurance will cover the difference in the event of a total loss.

GAP insurance is also known as Guaranteed Asset Protection. It is only available at the dealership when you purchase your RV, or online, although this is rare. It is usually paid for in a one-off lump sum, although some providers will allow you to roll the cost into your monthly payments.

You should consider purchasing GAP insurance if any of the following apply:

• You are required to buy it as a stipulation of a lease.
• You have less than a 20% down payment for your RV.
• Your loan is greater than 60 months in length.
• You will be living in your RV full-time.
• You have bought an RV model known for quick depreciation.
• You intend to add lots of miles to your RV's odometer.
• You want additional peace of mind.

You may not need GAP insurance if:

• You have already paid for your RV in full, or are close to paying it off.
• You have enough money in savings to cover the gap between interest and principal.
• Your RV will mostly remain parked.

When you don't

While RV GAP insurance is a great option for many, it's not always necessary and there are some instances where it doesn't make sense. Here are some reasons why you might choose not to purchase RV GAP insurance:

You've Already Paid for Your RV in Full

If you own your RV outright, there is no gap between the interest and principal owed, so GAP insurance is not necessary. GAP insurance is designed for those who are still making payments on their RV and owe more than what the RV is worth.

You Have Sufficient Savings

If you have enough money in savings to cover the gap between the insurance payout and the remaining loan balance in the event of a total loss, you may not need GAP insurance. However, some people still prefer to have the insurance to keep their costs low and avoid a large one-time payment.

Low Risk of Collision or Total Loss

If your RV is stored in a secure location and/or you don't plan on driving it frequently, the risk of a collision or total loss may be very low. In this case, you might decide that the additional cost of GAP insurance is not worth it.

Short Loan Period

If you're only going to be paying off your RV loan for a short time, it may not be worth purchasing GAP insurance. This is especially true if you have a substantial down payment and/or a low-interest rate, as the "gap" between the RV's value and the loan balance will be smaller and easier to manage.

Alternative Insurance Options

Some standard insurance policies may offer similar coverage to GAP insurance, such as collision insurance or total-loss insurance. Review your existing insurance policy carefully to understand what is and isn't covered before deciding if you need additional GAP insurance.

Remember, GAP insurance is not a substitute for a solid primary insurance policy. It is designed to cover specific situations where there is a gap between the insurance payout and the remaining loan balance. Always ensure you have comprehensive RV insurance in place before considering additional coverage options.

How much it costs

The cost of RV gap insurance varies depending on several factors, including the terms of the coverage and the amount of protection you require. Generally, you can expect it to add between $2 and $20 to your monthly premium if you choose to include it in your RV loan. The cost will depend on the specific terms and the extent of the coverage.

Most RV gap insurance policies are affordable, with a one-time payment of a few hundred dollars. However, policies for more expensive RV models may be slightly higher. For example, EasyCare's Guaranteed Asset Protection (GAP) insurance covers up to $50,000 of the difference between your insurance settlement and loan balance, up to $1,000 of your insurance deductible, and loan terms up to 135% of your RV's value. It is available for loans up to $500,000 and protects your investment for up to ten years.

When considering the cost of RV gap insurance, it is important to remember that it is designed to protect you from financial losses in the event of a total loss or theft of your vehicle. It covers the difference between the insurance settlement and the remaining loan balance, which can amount to thousands of dollars.

Additionally, RV gap insurance can cover other costs, such as the collision insurance deductible and fees on your loan. It is worth noting that RV gap insurance has limitations and will not cover repairs not covered by insurance, roadside assistance, medical bills, destroyed belongings, or gaps left past expiration dates.

When deciding whether to purchase RV gap insurance, it is essential to consider your individual circumstances, such as the length of your loan, the down payment you can afford, and the intended use of your RV. For instance, if you plan to live in your RV full-time or intend to drive it frequently, RV gap insurance can provide valuable peace of mind and financial protection.

How it works

RV GAP insurance is a special type of insurance designed to protect motorhome owners from losses beyond the RV's value if they are still making payments on their vehicle. It covers the gap between the vehicle's principle and interest-included price tags.

GAP insurance is only available at the point of sale from dealerships or specific online retailers. It is purchased as a one-time payment of several hundred dollars, which can be rolled into your monthly loan payments. The cost of GAP insurance varies from $2 to $20 per month, depending on the terms and amount of coverage.

In the event of a total loss, GAP insurance covers the difference between the loan balance and the insurance settlement, which is often based on the vehicle's market value. This can amount to a difference of several thousand dollars. GAP insurance can also cover the insurance deductible, fees on the loan, and total loss gaps from theft.

However, GAP insurance will not cover repairs not covered by insurance, roadside assistance, medical bills, destroyed belongings, or gaps past expiration dates. It is important to carefully review the limits of the policy before purchasing.

Additionally, GAP insurance is only applicable if you are financing or leasing your RV. It is not necessary if you have a substantial down payment or enough savings to cover the gap between interest and principal.

Where to buy it

Where to buy RV GAP insurance

RV GAP insurance is a special type of insurance that is designed to protect motorhome owners from incurring losses that go beyond the RV's value if they are still making payments on their vehicle. It covers the "gap" between a vehicle's principle and interest-included price tags.

GAP insurance is primarily a dealership-only offering. However, there are several things that need to be in place for you to get GAP insurance:

• You must be financing or leasing your RV.
• The dealership has to offer GAP insurance, or you have to get it online.
• The loan you have needs to be eligible for GAP insurance.

If you are looking to buy GAP insurance, you can try the following providers:

• EasyCare: EasyCare offers Guaranteed Asset Protection (GAP) insurance that covers up to $50,000 of the gap between your insurance settlement and your loan balance. It also covers up to $1,000 of your insurance deductible and protects your investment for up to ten years.
• Coach-Net: Coach-Net's Asset Protect GAP insurance is available for both new and used RV units and can only be purchased through Coach-Net Participating Dealers at the point of sale.
• Classic RV Gap: Classic GAP has been in the business for 30 years and offers protection in case your RV is stolen or totaled.
• Southeast Financial: Southeast Financial's GAP insurance plans are designed to protect you in the event of serious accidents and thefts, where your primary insurance may not be sufficient. Their policies can be purchased for just a few dollars a month.

It is worth noting that some people consider GAP insurance to be a scam or rip-off, and it is not necessary if you have already paid for your RV in full or have enough savings to cover the gap between interest and principal. Additionally, GAP insurance will not cover repairs not covered by insurance, roadside assistance, medical bills, destroyed belongings, or gaps left past expiration dates.

Frequently asked questions