GAP
GAP works directly with your insurance and is directly related to your financing. If you have full coverage insurance, Gap will pay the difference between what the insurance is willing to pay and what you still owe along with your deductible. Most plans will cover from $500 to $1000 deductible. If you do not have full coverage insurance, it will pay the difference between the NADA value of the motorcycle and what you still owe. The GAP covers you for the entire term of your loan up to 84 months.
Make sure the GAP provider that your dealership uses has a good reputation and is an A+ insurer. Some GAP providers only cover up to 135% of MSRP where others cover 150%. Also, check the dollar limits that they have on their coverage. GAP providers also have different criteria for Installment and Revolving Financing. If you are using Revolving Finance, make sure that your Finance Manager explains the difference in coverage.
Why do I need it?
GAP keeps you from having to pay for something that you no longer own or can no longer use. It protects you against your negative equity. Especially if you do not put any money down on your motorcycle, you will be upside down in the loan for the first few years. Just like any other mode of transportation, your motorcycle depreciates in value when you leave the dealership with it. GAP helps protect your credit.