Gap Insurance Calculator
Enter your loan balance and vehicle value to instantly see your gap exposure, a month-by-month projection, and whether gap coverage is worth it for your situation. Free — no sign-up, all calculations run in your browser.
Your Loan & Vehicle Details
How this is calculated
Gap Exposure (today)
Gap = Loan Balance − Vehicle ACV Projected loan balance each month uses standard amortisation:
Balancen = Balance0 × (1 + r)n − P × [(1 + r)n − 1] / r where r = monthly rate (annual rate ÷ 12) and P = monthly payment.
Projected vehicle value uses flat monthly depreciation:
ACVn = ACV0 × (1 − d/12)n where d = annual depreciation rate (entered above, default 18%). Actual depreciation varies by make, model, and mileage; use Kelley Blue Book or NADA Guides to look up your vehicle's current ACV.
All calculations run in your browser. Nothing you enter is sent to any server.
Month-by-Month Gap Projection
Rows highlighted in orange indicate a positive gap (you owe more than the car is worth). The gap typically peaks in the first 12–24 months, then narrows as you pay down the loan.
| Month | Loan Balance | Vehicle ACV | Gap | Status |
|---|
Understand Your Gap Exposure
Gap insurance matters most when you're "underwater" — when your loan balance exceeds what your vehicle is worth. This happens because cars depreciate faster than most loan balances decrease, especially in the first two years. Use the projection table above to find your peak-gap window.
Once your loan balance drops below the vehicle's value (gap = $0 or negative), you no longer need gap coverage — you can cancel it and request a refund for unused premium.
Learn more: How much does gap insurance cost? | Gap insurance on a used car | Do I need gap insurance?
Frequently Asked Questions
Gap insurance (Guaranteed Asset Protection) pays the difference between what your standard auto insurance pays out after a total loss and what you still owe on your loan or lease. If your car is totalled and the insurer values it at $18,000 but you owe $24,000, gap insurance covers the $6,000 shortfall — without it, you would owe that out of pocket.
Enter your current loan balance, your vehicle's current Actual Cash Value (ACV), your monthly payment, the remaining loan term, and your interest rate. The calculator applies standard amortisation to project your loan balance month by month, and applies your chosen annual depreciation rate to project the vehicle's value. The gap at any month is Loan Balance minus Vehicle ACV. A positive number means you're "underwater" — gap insurance would pay that amount after a total loss.
The ACV is the market value of your vehicle in its current condition, not what you paid for it. Use Kelley Blue Book (kbb.com) or NADA Guides (nada.com) with your vehicle's year, make, model, mileage, and condition. Your lender's payoff statement shows your current loan balance.
Gap insurance on a used car can still be worthwhile if you financed a high percentage of the purchase price, rolled negative equity from a previous loan, or chose a long loan term (60+ months). Used cars depreciate more slowly than new cars, so the gap window is usually shorter — but it still exists. Use this calculator with your actual numbers to see.
New cars lose roughly 15–25% of their value in the first year, then around 10–15% annually after that. A default of 18% per year is a reasonable starting estimate, but it varies significantly by brand and model. Luxury and electric vehicles often depreciate faster; trucks and some SUVs depreciate more slowly. You can look up historical depreciation data on iSeeCars.com or check your vehicle's resale value trajectory on KBB.