- Posted 27 Jul
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Car insurance options can be confusing, especially if you don’t know what a term means. GAP or Motor Equity Insurance (MEI) is a type of insurance that will pay the lender (if you took out finance to acquire your car) any outstanding balances on your loan contract that your comprehensive car insurance is unable to cover due to an insufficient payout amount to cover the remainder of your loan contract.
How it Works:
For example, say your car is stolen or written off, and you have had the car for a little while. There is bound to be a shortfall between what you must pay the finance company and the amount you actually receive from your comprehensive car insurer provider. Sometimes, this shortfall could amount to thousands of dollars and regardless of the event, must be paid to your lender.
Your GAP cover will provide the shortfall amount to the lender, provide you with further funds towards a new car and can pay some transfer costs to you as well.
The GAP insurance product Australian Credit and Finance provides will cover you for the duration of your car loan. Should the unlikely event unfold and you need to claim against your GAP insurance, we will work with your comprehensive insurers and car finance lenders to resolve the situation for you.
Get in contact with us today to receive further information or call one of our Insurance Experts on 1300 735 557.