Do I need GAP insurance?
Enter your loan balance and car value. In 60 seconds we'll tell you whether GAP coverage is worth it — and how much negative equity you'd owe if your car were totaled today.
GAP Insurance Calculator
Answer 6 quick questions.
If your car were totaled today, standard auto insurance would pay ~$24,000, leaving you owing $4,000 out of pocket. GAP coverage closes that gap.
- You currently owe $4,000 more than your car is worth.
- Your down payment (5%) is below the 20% safety threshold.
- A 72-month loan means slower principal payoff.
- New cars can lose 20%+ of value in the first year.
This is an educational calculator, not insurance advice. Actual coverage, eligibility, and cost depend on your insurer and state.
How GAP insurance works
Three steps that explain why negative equity is expensive.
After a total loss, your auto insurer pays the car's actual cash value (ACV) — not what you owe.
If your loan balance is higher than ACV, you're on the hook for the difference — often thousands of dollars.
GAP insurance pays that remaining loan balance so you're not stuck paying for a car you no longer have.
Get GAP price drop alerts
We'll email you when partner rates drop or a new provider enters your state.
Do I need GAP insurance if…
Do I need gap insurance if I put 20% down?+
Usually no. A 20%+ down payment typically keeps your loan balance below your car's value, so standard collision/comprehensive coverage would pay off the loan after a total loss.
Do I need gap insurance if I have a used car?+
It depends. Used cars depreciate more slowly, but if you financed nearly the full purchase price on a 60+ month loan, you can still be underwater and benefit from GAP.
Do I need gap insurance if I lease?+
Most leases require GAP coverage, and many leasing companies bundle it into the contract. Check your lease agreement before buying additional coverage.
Do I need gap insurance if I paid cash?+
No. GAP only covers the gap between what you owe and what a car is worth. If you owe nothing, there's no gap to cover.
How much does GAP insurance cost?+
Typically $20–$60/year when added to your auto policy, or a one-time $500–$700 charge from a dealer. Standalone providers are usually cheapest.
Can I cancel GAP insurance later?+
Yes. Once your loan balance drops below your car's value, GAP no longer benefits you and you can cancel for a prorated refund.