Will I get compensated for the value of my trade-in since my car was deemed a total loss?
My new Ford was just totaled in an accident the other day. I bought gap insurance through the finance company, but what about the value of my trade-in? My trade-in was valued at $5,000.
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Answered on Apr 29, 2021
Shannon is an expert in personal lines liability insurance with 13 + years of insurance industry experience. She also served as a special insurance liaison to AARP members for 6 of those years. She is a graduate of UL Lafayette and currently resides in NY with her family. Shannon is also an amateur juggler, ukulele player, and is a time travel paradox theory enthusiast.
“I am sorry to hear about your accident; I hope everyone is doing okay!
Once you have contacted your insurance carrier about the accident, you will want to get in touch with your lienholder. Once the claim is settled, they will activate the gap insurance if needed and you won’t have to do anything.
Insurance carriers are only required to pay for the vehicle’s actual cash value, not the loan, interest, taxes, and trade-in value.
Since you had such a high trade-in and the Ford is a new purchase, you may be in luck. If the car’s value is higher than the balance of the loan, the lienholder will be paid in full and you will be able to keep the difference. “
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