Gap insurance is a type of insurance that is commonly sold when you purchase a new car. It is designed to protect you from financial loss if your car is totaled or stolen and you owe more on your car loan than the car is worth. Gap insurance is meant to cover the difference between what you owe on your car loan and the actual cash value of the car at the time of the loss. However, if you pay off your car loan early or trade in your car for a new one, you may be entitled to a gap insurance refund. This refund is essentially a reimbursement of the unused portion of your gap insurance policy. If you pay off your car loan early, or your loan amount is less than the cars value, you will want to request a refund. The amount of your refund will depend on the terms of your gap insurance policy, including the length of the policy, the amount of coverage, and the amount of time remaining on the policy. It is calculated by proration. If you trade in your car for a new one, you may also be entitled to a gap insurance refund. It is important to note that not all gap insurance policies are refundable. Some policies may have a minimum term or may only provide coverage for a specific type of loss. Before purchasing gap insurance, be sure to read the terms and conditions of the policy carefully and ask your insurance provider about their refund policy. By doing so, you can ensure that you are not paying for coverage that you no longer need. Claiming a refund may not be a quick or easy process either. You will need to provide the proper documentation such as a lien satisfied letter, cancellation letter and show proof of the current mileage. Typically the entire process can take 6-8 weeks. If you don’t want to spend the time and energy dealing with dealers and insurance companies, mywarrantyrefund.com has been assisting auto consumers for 8 years and has successfully retrieved more than $1 million in refunds and counting. In conclusion, if you feel you are entitled to a refund, make sure to start the process right away because the refund amount decreases each day you wait.