My car was a total loss the insurance company paid what the car was worth but not the finance charges. How do this work? I thought your insurance paid everthing and everything was a lump sum
2007-02-20 08:54:27 · 11 answers · asked by corey b 1 in Cars & Transportation ➔ Insurance & Registration
No, no no! If you read the policy it will say they pay actual cash value of your vehicle. Nothing there covers what you owe on the vehicle. If you owe more than it's worth you're reponsible for the rest. Next time check out gap insurance. That's what gap insurance does- pays for the rest after the insurance has valued the vehicle if there is a difference.
2007-02-20 22:39:44 · answer #1 · answered by Chris 5 · 0⤊ 0⤋
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RE What are insurance company for?
My car was a total loss the insurance company paid what the car was worth but not the finance charges. How do this work? I thought your insurance paid everthing and everything was a ...show more
2014-10-07 18:13:25 · answer #2 · answered by ? 1 · 0⤊ 0⤋
The insurance company only pays the actual value of the vehicle immediately before the accident. Coverage is available from some companies that pays the "gap", or the difference between what the car is worth and what you owe, but this is not standard on a policy, and costs extra, if you can even get it.
This is yet another reason you should always avoid being "upside down" in your loan.
2007-02-20 09:01:23 · answer #3 · answered by J.R. 6 · 0⤊ 0⤋
If you wanted protection from owing more than the vehicle was worth, you should have opted for GAP insurance which protects the lender against such a thing.
Obviously you didn't ask questions when you bought insurance. It's also obvious you didn't read the contract you signed, or you would know how it works. You thought incorrectly. Insurance is not there so you can make a profit, or to protect you from having a loan for more than the car is worth.
2007-02-20 12:21:50 · answer #4 · answered by oklatom 7 · 0⤊ 0⤋
Ahh, such a common misconception.
Insurance owes your actual cash value for your vehicle- nothing more- nothing less.
Think about it... what if you got a really good deal on a car and put a huge down payment and only had 1k left to pay off? Now think of someone else had really bad credit... got a horrible loan... and owed 20k on the same car. Why should they pay someone 20k for their mistake and 1k to the person with good finances?
Its your own fault if your loan is upside down and this is yet another reason to get gap insurance. Expensive lesson you have learned.
2007-02-20 09:05:08 · answer #5 · answered by Anonymous · 0⤊ 0⤋
Your insurance company insures your car, not anything else. They only owe the actual cash value of the vehicle. If you over financed, that's not their problem..they are under no legal obligation to pay the finance charges, and it clearly states in your policy what they pay for.
2007-02-20 14:29:54 · answer #6 · answered by bundysmom 6 · 0⤊ 0⤋
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2015-01-15 17:55:51 · answer #7 · answered by ? 1 · 0⤊ 0⤋
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RE What are insurance company for?
My car was a total loss the insurance company paid what the car was worth but not the finance charges. How do this work? I thought your insurance paid everthing and everything was a lump sum
2014-09-06 03:59:04 · answer #8 · answered by Anonymous · 0⤊ 0⤋
You can find the best rates and offers for your insurance at: COVERAGEDEALS.NET
2014-05-26 13:02:18 · answer #9 · answered by Anonymous · 3⤊ 0⤋
Gap insurance would have covered you in this situation and it is quite inexpensive. Next time, ask your insurer to include Gap coverage on your policy.
2007-02-20 16:26:40 · answer #10 · answered by Maple Syrup 1 · 0⤊ 0⤋