Liability to Leasing Company in Case of Totaled Car and Gap Insurance

Ask the Hackrs
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As an FYI, I added gap insurance on a Toyota Tacoma lease recently. It was a $2.84 adder every 6 months through my current insurer. Definitely check your own insurance company before picking up this coverage at the dealership.

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Dealers are so often wrong it’s not funny

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I think your right he said he has to check again to make sure

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Question, If you do a 1-pay amount, for 24 months,
would the GAP insurance cover that amount in case of a major loss?
Lets say $MSRP 30k Tacoma , you do 1-pay for 24 months with ~80% RV.
and it gets totaled or stolen early on. Would GAP cover the 1 pay or replace the car for you?

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I can’t say for the Tacoma but for the Mirai the dealership called toyota and verified that they will not prorate that amount it is a risk you will be taking. Gap will only cover the difference in the residual and the market price of the car

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Just wanted to share my experience here in terms of Gap insurance on a leased 2019 Toyota Mirai. (I didn’t do 1-pay tho.)
I was suggested by the finance manager, as well as my sales rep, to buy Gap insurance for my Mirai before signing the contract. Like the OP and others mentioned, the value of a Mirai, or an EV, drops significantly after 1 or 3 years. If the car got hit and totaled, I would be liable for the gaps between the actual residual of the car and the one insurance company actually pays (market value).
They quoted me 3-year Gap insurance on my 2019 Mirai for $695 and I took it. It’s roughly $230 a year or $19 a month. I added the Gap insurance for a peace of mind for my 3-year lease term.
AAA doesn’t sell Gap insurance when I asked.

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AAA is who I get insurance through here in FL and they definitely offer gap here (and its dirt cheap). I even added it to BMWFS leases even though they already have it.

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we bought gap through gapdirect.com for $288 for all 3 years

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I just finished the lease transaction on my Mirai and confirmed that Toyota Financial does not sell Gap Insurance for 1 pay leases. This got me thinking why would Toyota not sell Gap Insurance for one pay leases?

It must be because, GAP only covers what you owe them in lease payments and what the insurance pays out if car is totaled. For example, if you leased a $30,000 car and had a three year lease at $200 per month for three years, you owe the lease company 200 x 36 = $7,200 payment and let’s say you totaled your car on the first day and insurance company only valued and paid off $10,000 for the car. In this scenario, your gap insurance would only cover $7,200 payment that you were subject to. Since, in a 1 pay lease, you already paid that $7,200 payment upfront, there is no need for a gap insurance and that is why Toyota Financial does not provide GAP for 1 pay lease.

Now, what I am not sure about is in the scenario above is there is still $12,800 ($30,000-7,200-10,000) that is missing and who picks up the tab on that difference. At any rate, GAP insurance for 1 pay may be worthless.

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Thanks for the info. Just bought GAP from gapdirect.com and cancelled GAP by Toyota. Just one day pass the chance to get full amount of $950. So I will get $875 (pro-rated amount - $50 cancellation fee). Basically I take back $875-$288 = $587. Better than nothing. Sweet.

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Check your lease agreement to see the actual number for GAP. If it’s $950 then do what I did. Buy GAP from gapdirect.com and cancel GAP by Toyota. It’s a big saving right there. Even if it’s 695 then you would take back $400.

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@niceshot: Thanks. Didn’t realize the Toyota Gap insurance can be canceled and refunded (prorated) . Will definitely look into this.

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I hadn’t known either. Just cancelled it a few minutes ago thanks to st_t1m3’s info.

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I would advise against purchasing GAP from Gapdirect.com if you look at the website, the insurance company is called Western General. Look at the yelp review of this company. This company sounds like a scam and you won’t likely get your money. https://www.yelp.com/biz/western-general-insurance-company-calabasas-2
I would trust Toyota Gap than this unknown company.

Also, as I posted previously if anyone is doing one pay lease, GAP is not possible to get and likely not needed.

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Thanks. Will stay with Toyota GAP insurance. :+1:

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What is the difference between Gap insurance from State Farm for $10 and Gap insurance from Toyota or Kia for $XXX?

Anyone know what a Gap waiver is from Toyota or Kia?
Is that a Scam or legit?

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The difference is a whole lot of money! From what I have seen, gap insurance through your own insurance company is a tiny fraction of the cost from buying it from Toyota, or any other third-party.

In seriousness, I think the only practical difference would be that the Toyota gap insurance has no deductible, gap insurance through your regular insurance would have whatever your normal deductible is.

As I mentioned in another thread, I added gap insurance to my Tacoma for, no joke, <$0.50 a month ($2.84/6 mos) through my regular insurer.

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Got it,
What about a Gap Waiver from Toyota or Kia?
Is that a dealer Scam or legit?

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GAP isn’t a scam, but buying it from captive banks might be a ripoff.

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I understand that GAP insurance is not a scam but
I saw something called a “Gap Waiver”.
from Toyota or Kia can’t remember.
I think it says it’s free or included in the lease.

Is that legit or dealer scam.