Sometimes when people buy a car from a dealer, they can automatically add insurance known as GAP, but what many don’t realize is that they can decline that coverage.
In February of this year, Martha Valdés did something that many long for, she finished paying the bill for the car she had. “I was paying it until I wanted to change it. When I wanted to change it, I paid it in full“.
In addition to paying off the debt, Valdés had credit because he had paid for an optional car insurance known as GAP.
Shannon Martin, an analyst at Bankrate, explains that GAP is a type of insurance coverage that helps you pay off a car loan in the event you suffer a total loss and owe more than the car’s depreciated value.
Martin explains that if you don’t have GAP and your car is totaled due to a flood or accident within the first year and a half, you would have a higher balance due to the amount of interest…more than accident insurance would cover. And you could have to pay thousands of dollars more to get out of the contract when you don’t even have the vehicle.
In Valdés’s case, he never had to use his GAP insurance and when he finished paying the bills on the car, he asked the dealer to reimburse him for the months of insurance he didn’t get to use.
“They did the paperwork for me, they even gave me a notarized paper. But months passed, February, March, April, May, June, July and nothing happened … it is where I start and say wait, that is, my channel is there favorite that is called Telemundo Responds So I’m going to address them,” says the woman.
It was there that our producer Jose Luis Castillo contacted the dealer and the Chase bank that had the loan from Martha Valdés. Loan that they had congratulated her on repaying her.
In the letter they sent you in February they said you may be due a refund for GAP insurance. After we contacted them, Chase sent out a statement saying, “We’re sorry it took time for Ms. Valdes to receive her check. We’re working with the dealership to get it fixed.”
“It didn’t last, I swear to that God who is in heaven, not even 15 days did they give me my money back,” Valdés is moved when he remembers, he says that he used the 700 dollars he recovered to buy his next car and advises Everyone look closely when they sign a contract at a dealership because she says she didn’t know this insurance was optional.
“Let them look carefully before buying a car and before signing a paper. If they don’t understand English or know how to read it, ask,” advises Valdés.
Bankrate’s insurance analyst advises you to do your research and carry your own insurance when you go to buy or lease a car instead of accepting the one offered by the dealer because it usually ends up coming out more money.
