How does gap insurance work? If your car is stolen and never recovered or declared a total loss due to an accident, your auto insurance company will pay the actual cash value of the car.The actual cash value can be a lot different from what you still owe on your loan. Without gap insurance you are still responsible for paying the difference between the actual cash value and the amount left on the loan.This might mean having to come up with hundreds, and more likely, thousands of dollars to pay that debt.Gap insurance eliminates that difference and thus, the need for you to pay the difference. Quelle "How does gap insurance work?" : General Main page for "How does gap insurance work?"