Gap insurance, or Guaranteed Asset Protection insurance, helps cover the difference between the amount you owe on your auto loan or lease and the current market value of your vehicle if it’s totaled or stolen. Typically, standard auto insurance covers only the vehicle’s current market value, which might be less than the outstanding loan balance, especially if the car depreciates quickly. If your car is declared a total loss, gap insurance steps in to pay the remaining balance on your loan or lease, preventing you from being financially burdened by a significant gap between what you owe and what you receive from your primary insurer. This coverage is particularly beneficial for those who have made a small down payment or have a high-mileage vehicle that depreciates rapidly.