Here are some good closes brought to us by Safeguard Products:
Objection: I have insurance already; I don't need more.
Response: I understand ... your insurance company is obligated to provide you funds that are equal to your actual cash value. However, they are not obligated to give you the amount equal to your payoff. If you owed $25,000 on your vehicle, you wouldn't accept a $20,000 settlement, would you?
Objection: I can't afford it.
Response: I understand ... but what would happen if your vehicle was deemed a total loss and you still owed $5,000 after the insurance company settled?
You would be forced to finance that $5,000 into your next car purchase - which would add an additional $100 to your monthly car payment, or you would have to come up with that $5,000 out of pocket.
Wouldn't it make more sense to pay $10 more per month right now for that coverage and peace of mind?
Objection: I have never had a car totaled before.
Response: I understand ... and you are lucky! However, let's say this does happen to you. When your car is totaled, your insurance company calls all the shots, and their goal is to settle as cheaply as possible, often using unfair techniques to determine the value of your car.
GAP protects you from the consequences of this unfair treatment by paying off your loan regardless of the valuation methods used by your insurance carrier.
Objection: I'll check with my insurance company about GAP.
Response: I understand ... however, it is important to note that some states do not allow you to purchase GAP from your insurance agent because there can be a conflict of interest.
Insurance companies often fail to total out vehicles that would otherwise be totaled, simply because the customer has GAP insurance through that carrier.
Rather than pay off your lender, the insurance companies may decide to pay to fix your car, although this may leave you with a greatly devalued vehicle that may be unsafe or uncomfortable to drive.
Objection: I have been with the same insurance company for years, and they will take care of everything.
Response: I understand, and it's great that you have a great relationship ... but did your agent ask you how much you were financing today?
I bet he didn't because whether you financed $5,000 or $50,000 on this car, your insurance company is only going to pay the Actual Cash Value of the vehicle if it's totaled.
You will be responsible for the payoff difference after your insurance company settles. With GAP protection, you are completely covered.
Best Practices
1. Ask Questions: Most customers know very little about GAP, and a simple explanation of what GAP covers in the event of a total loss will make financial sense to the customer.
What do you know about GAP?
In the event your car is totaled, where will you find the money to pay off your loan and insurance deductible?
2. 553 Contract Close (CA only):
Using a current 553 Law contract, point out Outstanding Loan Balance Settlement section.
Say to the Customer: This is a legal contract, and printed in RED is the statement that your insurance may not cover the outstanding loan balance.
Flip Contract Over and Say: You will notice that this has become such an issue that the notice is printed a second time.
You are required to initial this notice as recognition that you understand your insurance coverage may not pay off the balance you owe in the event of a total loss.
*This example refers to Settlement GAP.
Good stuff! - AFI
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