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Discussion Starter #1
I just got my 848 and I'm debating paying $595 for the GAP insurance.

It says it will cover up to 120% of the MSRP, so $13,995+20%='s $16,794. It will also pay my $500 State Farm deductable.

I only put $4,135 cash down and financed the rest @ 12.99% for 60 months.

Is it worth it for me to get it? It is the first bike I've had in quite a few years so if something does happen I don't wanna be assed out on the remainder of the loan that State Farm doesn't pay off. On the other hand I plan on putting about $5K cash towards the principal on top of my payments in Jan/Feb along with maybe refinancing it another year later to save on the interest when my credit is better.

Comments please??? Thanks!
 

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I don't know about having it on a bike, but it is definitely worth it on a car. For the few bucks a month, it's great to have if you total your car. I've seen several people bumming because they totaled their car and still owed thousands of dollars after the insurance company's settlement. I've also seen people who were way upside down, owing $5-10K more than their car was worth, totaled their car and the whole thing was paid off free and clear.

I don't know if it would be worth it on a bike though. I don't think you'd be as upside down on a bike after a year or two.
 

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It seems as though you put enough down to not really worry. If you put little or no down, than for sure go for it.
 

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I agree, shouldn't have an issue with that much down.
I've bought cars in the past with almost 0 down, 0 interest but not that big of a discount. The numbers worked out, so I did it. When I called my insurance agent to insure the vehicle, he recommended the gap coverage due to the tremendous immediate depreciation. Only a couple bucks a month for peace of mind. $500+ seems very high, ask your insurance company.

BTW, I just got a card in the mail today advertising very low interest rates on new Ducatis. Is it to late to take advantage of that?
 

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I've found that as soon as you go out the door, you drop 30% in value. What does your insurance agent say? Not the shops agent or the salesman, but your own personal? Mine's pretty honest, so I don't worry about him flim-flamming me.
 

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Check around (well sounds like you already bought it?) But still check around. USAA offers a service to cover any upside down situation when I finance something with them. They didn't used to would have been helpful several years back.
 

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gap insurance helps especially when your bike gets totalled and you still owe more than what your bike is worth. it doesn't take that much for our bikes to get totalled. imo, get gap but $500+is a bit high.
 

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Think about it this way....You're out $4000.00 already.
GAP is gonna cost you $500.00....If you total the bike (which isn't hard to do @ all)...you won't get what you paid for it, so you're under already....and minus your $4k...Take the GAP, that way you will @ least break even to get another or buy back the totaled bike. You'll have trouble selling a salvaged title, but could repair it & still ride, or buy a new one with the GAP coveraged payoff...Wish I had this option 10yrs ago....I'ld gamble $500 on a $4000.00 investment...If you don't & lose, you're out $4000.00....

My last TL1000R was totaled because one side of the bike (3 fairings, foot peg, shift lever, and Arrow pipe were damaged on a high-side)...I owned it outright, but had full cvg...Allstate said that since damage was more than 60% of bike's worth, they would total it out. I had to take 29% payout & repair the bike + paintjob it had ($1k a side) outta pocket.

If you are gonna ad mods (pipe, pegs, damper, tires, etc on it)...get it. Think of it this way, if you'll invest thousands of dollars in mods, why not invest the cost of a set of tires to protect it?

Just my $.02.....It's your bike though...
 

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Call State Farm and check. When I was going to use them 2 months ago, my agent said the loan came with it.
 

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Think about it this way....You're out $4000.00 already.
GAP is gonna cost you $500.00....If you total the bike (which isn't hard to do @ all)...you won't get what you paid for it, so you're under already....and minus your $4k...Take the GAP, that way you will @ least break even to get another or buy back the totaled bike. You'll have trouble selling a salvaged title, but could repair it & still ride, or buy a new one with the GAP coveraged payoff...Wish I had this option 10yrs ago....I'ld gamble $500 on a $4000.00 investment...If you don't & lose, you're out $4000.00....

My last TL1000R was totaled because one side of the bike (3 fairings, foot peg, shift lever, and Arrow pipe were damaged on a high-side)...I owned it outright, but had full cvg...Allstate said that since damage was more than 60% of bike's worth, they would total it out. I had to take 29% payout & repair the bike + paintjob it had ($1k a side) outta pocket.


If you are gonna ad mods (pipe, pegs, damper, tires, etc on it)...get it. Think of it this way, if you'll invest thousands of dollars in mods, why not invest the cost of a set of tires to protect it?

Just my $.02.....It's your bike though...
How does GAP work? I don't see how this saves his $4k investment. I thought GAP insurance covers only the difference between the fair market value of the bike and the amounts owed under the loan. It doesn't cover depreciation off of purchase price does it? Since he put $4k down already, is there anything really for the GAP insurance to protect?
 

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my $.02 -

Get the Gap insurance.

Not to sound like your Dad - but - I gotta ask why you would finance the rest at a 12 percent rate over 60 months? Gap insurance will protect you over 5 years of rapid depreciation. Unfortunately for all of us - Motorcycles are horrible investments. Five years is a long time for a lot of potentially bad things to happen where your gap insurance will come in handy. I agree that 500 is too much to pay - mine was in the 150-225 range. There are a lot of different ways to get this insurance though - the dealer, through the loan originator and your insurance company itself will all offer Gap. Get a quote in writing and shop it around.

Bottom line - Best thing to do is protect yourself from the risk of over exposure which you have done by borrowing money over such a long period of time. Get good coverage and then pay your bike off early.

Enjoy your new ride!! :cool:
 

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I just got my 848 and I'm debating paying $595 for the GAP insurance.

It says it will cover up to 120% of the MSRP, so $13,995+20%='s $16,794. It will also pay my $500 State Farm deductable.

I only put $4,135 cash down and financed the rest @ 12.99% for 60 months.

Is it worth it for me to get it? It is the first bike I've had in quite a few years so if something does happen I don't wanna be assed out on the remainder of the loan that State Farm doesn't pay off. On the other hand I plan on putting about $5K cash towards the principal on top of my payments in Jan/Feb along with maybe refinancing it another year later to save on the interest when my credit is better.

Comments please??? Thanks!
Unless I have no idea what I'm talking about (quite possible), in my mind the math doesn't work out. You have an outstanding loan of about $9500. GAP protects you if you total the bike and the replacement value paid by the insurance company is less than the amount you owe on the bike. Has nothing to do with what a new bike costs. So if you total it tomorrow and the insurance company gives you anything more than $9500, then the GAP insurance was a waste.
 

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Discussion Starter #13
Unless I have no idea what I'm talking about (quite possible), in my mind the math doesn't work out. You have an outstanding loan of about $9500. GAP protects you if you total the bike and the replacement value paid by the insurance company is less than the amount you owe on the bike. Has nothing to do with what a new bike costs. So if you total it tomorrow and the insurance company gives you anything more than $9500, then the GAP insurance was a waste.
Not quite, OTD price was $16,635.89 so after my downpayment I still owe $12,500.89. My monthly payments total $3,420 per year, $2,975.74 of that is principal from what I can figure based on my APR.

So, for example, this month next year I will still owe $9,525.15 on it and figure a mileage of 5,000 just for conversations sake. Given what I am seeing in the used market price a 1yr old 848 with 5K miles should have no problem being worth $9,600, although it also won't be worth much more lol.

I think I'm going to skip it then. Did that make sense?
 

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Not quite, OTD price was $16,635.89 so after my downpayment I still owe $12,500.89. My monthly payments total $3,420 per year, $2,975.74 of that is principal from what I can figure based on my APR.

So, for example, this month next year I will still owe $9,525.15 on it and figure a mileage of 5,000 just for conversations sake. Given what I am seeing in the used market price a 1yr old 848 with 5K miles should have no problem being worth $9,600, although it also won't be worth much more lol.

I think I'm going to skip it then. Did that make sense?
I see. Makes sense. Sounds to me like you won't be upside down anytime soon. It's a closer call than I originally was thinking, but I'd skip the insurance like you say.
 

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Discussion Starter #15
Cool because I just used that money to buy the Ohlins steering damper kit lol.

Thanks again for all of the advice everyone and also the people who PM'd me.

Alex
 

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How does GAP work? I don't see how this saves his $4k investment. I thought GAP insurance covers only the difference between the fair market value of the bike and the amounts owed under the loan. It doesn't cover depreciation off of purchase price does it? Since he put $4k down already, is there anything really for the GAP insurance to protect?
What I meant was that he already put down $4k....If he doesn't have GAP insurance, he will only get FMV, minus depreciation. So if he wads it, he will NOT even get enough to replace the one he bought, plus be out the $4k he put down & NO bike to show for it.
GAP doesn't cover his down payment of $4k...you are correct! GAP covers the difference of FMV VS retail price of the bike...whether he financed $5k or $15k doesn't matter.

If he paid $20k today for the bike, wads it tomorrow, the bike might fetch $17k....with depreciation/FMV...the GAP will pay the difference of $3k....so he will get $17k ins payout + $3k GAP for a total of $20k to get a new bike. Without GAP, he will get $17k....and be out the $4k he chunked down...So he couldn't get that $20k bike anymore...GAP will save him as time goes by too, since the odds are in favor of something happening within 5 yrs (statistically true)...
For $500, it worth its' weight in gold on a $16k investment....

Personally, I would've NOT put down $4k. I would've used that for add-ons/mods/etc...That $4k only saved
$80/month on payments (@ $20 for every $1k financed). The BEST thing to do would be to pay off the loan early, pay out excess $$ every month on the principal loan amt, and/or refinace after 1 yr....
 

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What I meant was that he already put down $4k....If he doesn't have GAP insurance, he will only get FMV, minus depreciation. So if he wads it, he will NOT even get enough to replace the one he bought, plus be out the $4k he put down & NO bike to show for it.
GAP doesn't cover his down payment of $4k...you are correct! GAP covers the difference of FMV VS retail price of the bike...whether he financed $5k or $15k doesn't matter.

For $500, it worth its' weight in gold on a $16k investment....

Personally, I would've NOT put down $4k. I would've used that for add-ons/mods/etc...That $4k only saved
$80/month on payments (@ $20 for every $1k financed). The BEST thing to do would be to pay off the loan early, pay out excess $$ every month on the principal loan amt, and/or refinace after 1 yr....

Here is where the confusion on my part is. I don't think GAP covers the difference between FMV and the retail price of the bike as you say. I think GAP covers the difference between FMV and what you owe to the bank on the bike. It's not protection so that you can replace the motorcycle. It's protection so that you can pay the bank in full. They should rename it "upside down insurance."

As to the putting down $4,000. I just see things differently. At 13% interest he shouldn't have financed any of it. To the extent he had to, putting as much down as possible makes sense. 13% on $4,000 is more than 500 in interest charges a year alone. I
 

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. . .

If he paid $20k today for the bike, wads it tomorrow, the bike might fetch $17k....with depreciation/FMV...the GAP will pay the difference of $3k....so he will get $17k ins payout + $3k GAP for a total of $20k to get a new bike. Without GAP, he will get $17k....and be out the $4k he chunked down...So he couldn't get that $20k bike anymore...GAP will save him as time goes by too, since the odds are in favor of something happening within 5 yrs (statistically true)...
For $500, it worth its' weight in gold on a $16k investment....

I didn't mean to cut this out of my last response. I just don't think this is true. I don't think this is how GAP works. The way I think it works is assuming he negotiated a $20,000 purchase price, paid $4,000 down and financed $16,000, and then he "wads is tomorrow" . . . the insurance company will give him a check for $17,000. He will take $16,000 and give it to the bank to pay off the balance of his loan and will pocket $1,000. In this case the GAP insurance doesn't kick and and was a waste of money.
 

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GAP coverage typically only pays off the loan. If you owe $10k and the insurance company will only give you 8k then the GAP covers the other $2k.

That being said I did have a GAP policy on my Supersport that would reimburse your down payment up to $1000 but no more. I went ahead and put the $1000 down and banked the rest that I had. When I totaled the bike 3 months later I got the loan paid off and my $1000 back. It was a good deal for me since I financed the GAP and in the end they paid their own policy but it was not $500. The "transferrable" warranty that the dealer sold me was a different story. It was only "transferrable" if you bought the replacement bike from them, the GAP paid for that too though.

Anyway, I always ask for GAP coverage because of the mileage that I typically drive in a year (30 to 50k) I am ALWAYS upside down.
 
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