Product center
Equity Protection
Equity protection concerns a customer’s future trade position — a different problem than GAP solves. This center explains what the category is and how to evaluate a program.
Where GAP protects against owing more than a totaled car is worth, equity protection products aim to support a customer’s equity or trade position toward a future purchase — concerning a voluntary future trade rather than a total loss. It is a category, not one standardized product, and it goes by a range of names.
These products are frequently confused with GAP. This center draws the line clearly: what equity protection is, what can trigger a benefit, and the conditions that come with it — with the written agreement, not the product’s name, controlling.
What you’ll learn here
- How equity protection differs from GAP
- What can trigger a benefit, and how designs vary by program
- The eligibility, conditions, and limits these products carry
- How to read an equity-protection agreement before presenting it
- When a program may or may not fit a customer
Articles in this center
- What Is Equity Protection? A Dealer’s Guide to Trade Position, Customer Fit, and Program QualityEquity protection concerns a customer’s future trade position — not a total loss — which is what separates it from GAP. It is not one standardized product: what triggers a benefit, who qualifies, and how a benefit is calculated are defined by the written agreement. This dealer’s guide explains the category and how to evaluate a program. The agreement controls.
- Equity Protection vs. GAP: Which One Does a Customer Actually Need?GAP and equity protection are constantly confused because both involve value versus what you owe — but they address different risks at different moments. GAP responds to a total loss on the current loan; equity protection concerns a future trade position. This guide is how to tell which one (or both) fits — a decision framework, not a recommendation.
- Do You Need GAP if You Have Full-Coverage Insurance?“I have full coverage — why would I need GAP?” is the most common GAP objection, and it rests on an incomplete assumption. Insurance settles a total loss on the vehicle’s value; GAP concerns the loan balance that can remain above it. This guide explains what full coverage really means and why the two solve different problems — a decision framework, not a recommendation.
More articles coming to this center
The cornerstone articles below are in production and will publish here.
How equity-protection triggering events differ · in production
How dealers should compare equity-protection agreements · in production
What can change a customer’s trade position · in production
Equity Protection: common questions
Is equity protection the same as GAP?
No. GAP addresses a total-loss shortfall on the current loan when a vehicle is destroyed. Equity protection generally concerns a customer’s future trade position while the vehicle still exists. They solve different problems and can coexist.
How much depreciation does equity protection address?
It varies by program and is defined by the contract’s trigger, conditions, and benefit terms — not a fixed universal amount, and ordinary depreciation is generally not itself a covered event unless the agreement creates a defined benefit.
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