Updated August 12, 2025
Gap Insurance Calculator
Determine if you need gap insurance by comparing your loan balance to your vehicle's actual cash value. Protect yourself from financial loss.
Vehicle & Loan Information
Enter your current vehicle and loan details
💡 Find current value: Check KBB, Edmunds, or your insurance company's valuation. Loan balance is on your monthly statement.
Gap Insurance Cost
Enter the cost of gap insurance coverage
💰 Cost comparison: Insurance company: $400-700/year. Dealer financing: $500-1,000+ (avoid if possible).
Gap Analysis
Current Loan Balance$28,000
Actual Cash Value$24,000
Gap Amount$4,000
Gap Percentage14.3%
Total Depreciation$11,000
Future Projections
6 Months
Projected Gap
$3,225
12 Months
Projected Gap
$2,323
Estimated Break-Even Point
34 months
When loan balance = vehicle value
Gap Insurance Recommendation
Coverage Optional
Gap insurance is optional. You have a moderate gap of $4,000. Consider your risk tolerance and the cost of coverage.
Monthly Cost
$50.00
For gap coverage
Coverage Ratio
6.7x
Gap amount vs cost
Value Assessment
Good Value
Cost vs benefit
✅ You Need Gap Insurance If:
- • You owe $5,000+ more than car's value
- • You made a small down payment (<20%)
- • You have a long loan term (60+ months)
- • You drive a rapidly depreciating vehicle
- • You rolled negative equity into the loan
💡 Gap Insurance Tips:
- • Buy from your auto insurer, not the dealer
- • Cancel when loan balance ≤ vehicle value
- • Review coverage annually
- • Requires comprehensive/collision coverage
- • Doesn't cover deductibles or overdue payments
Total Loss Scenarios
What you'd pay out of pocket without gap insurance
❌ Without Gap Insurance
Insurance payout:$24,000
Loan balance:$28,000
You owe:$4,000
✅ With Gap Insurance
Insurance payout:$24,000
Gap insurance covers:$4,000
You owe:$0