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The most comprehensive vehicle insurance may have still gaps in coverage. That can mean one ends up with a potentially significant expense if a vehicle is stolen and unrecoverable, or is written off as a total loss. This is usually because an insurance settlement for such claims after applying the depreciation on the vehicle may be less than the outstanding balance of a finance contract for the same. GAP Insurance offers protection in situations like these by paying the shortfall amount owing to the Finance Company or bank.

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