Vehicles normally depreciate very quickly the first few years.
The loan or lease gap occurs because the loan or lease payments are spread over a longer period of time, and the amount of the unpaid balance remains larger than the value of the vehicle over much of the loan period. The gap is often discovered only after a total loss when the amount the insurance company pays you for the actual cash value of the vehicle is less than what you owe the bank or leasing company. Instead of being reimbursed for your total loss, you have to pay the bank or leasing company thousands of dollars out of your own pocket in addition to the deductible. Nobody is to blame for this problem - not the bank or leasing company or the insurance company or the car manufacturer, but there is a solution to the dilemma. This endorsement is available in most states, and many companies will offer this endorsement or a variation.