If my car was totalled in the Louisville flood and the insurance company paid the bank what the car was worth, am I still responsible for the balance since it was a natural disaster?
1 Answer from Attorneys
If you didn't have GAP coverage then, yes, you will have to pay the balance owed to the bank.
Whenever you finance a vehicle and will be upside down on the loan at some point, it is extremely important to carry GAP coverage. When a loss occurs, GAP insurance pays the difference between the value of the vehicle and the balance on your loan. Some policies will even pay your deductible, which you generally incur when the loss occurs as a result of some natural disaster or no-fault collision. Such as from flooding of the Ohio River... or hitting a deer on the Bluegrass Parkway!