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    Question

    An auto-mobile insurance option, available in some

    states, that covers the difference between a carтАЩs actual cash value when it is stolen or wrecked and the amount the consumer owes the leasing or finance company is called?
    A Double Insurance Correct Answer Incorrect Answer
    B Commercial Insurance Correct Answer Incorrect Answer
    C Industrial Insurance Correct Answer Incorrect Answer
    D Gap Insurance Correct Answer Incorrect Answer
    E None of these Correct Answer Incorrect Answer

    Solution

    Gap insurance is a type of auto insurance that car owners can buy to protect themselves against losses that can arise when the amount of compensation received from a total loss does not fully cover the amount the insured owes on the vehicle's financing or lease agreement. This situation arises when the balance owed on a car loan is greater than the book value of the vehicle

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