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Posted: Tue Feb 28, 2006 12:49 pm
by Sev
Chris8187 wrote:I don't see what is wrong about that. Why should the insurance company pay off your debts? I think it is reasonable they give you what the bike was worth before you crashed it.
So if you buy a bike and payed $9000 for it, it's worth $9000, but if you take it out on a loan and have only payed $4500 on it, how much is your bike worth? $4500, or $9000? The insurance company will only pay back what you've paid, then you need to pay off the rest of the loan/financing yourself. EW!
Posted: Tue Feb 28, 2006 7:29 pm
by Caper#5
Sevulturus wrote:Chris8187 wrote:I don't see what is wrong about that. Why should the insurance company pay off your debts? I think it is reasonable they give you what the bike was worth before you crashed it.
So if you buy a bike and payed $9000 for it, it's worth $9000, but if you take it out on a loan and have only payed $4500 on it, how much is your bike worth? $4500, or $9000? The insurance company will only pay back what you've paid, then you need to pay off the rest of the loan/financing yourself. EW!
I thought they would pay you the book value of the bike. I mean you could only have paid a grand on your $9000 bike and have it written off, does that mean your insurance only pays you back a grand or the book value for your bike. I would expect to get compensated for the book value of the bike and of course pay off the remainder of the loan.
Did that make any sense, maybe I've had a few too many wobbly pops!!
Posted: Wed Mar 01, 2006 4:38 am
by flynrider
That's exactly what they do. They pay you what it would cost to replace the bike. The current market value.
It would be crazy if they were forced to pay whatever you owed on it. People who put little or nothing down and settled for a high interest rate, would get a better payoff than somone who was more fiscally responsible. Not a good thing. That's the whole point of gap insurance. If your going to extend yourself so far that merely replacing the bike would put you in a financial bind, well then you're going to have to pay more for the increase payoff.
In the olden days, when you bought a car or motorcycle, you had to put enough down so that you would not be upside down on a loan as soon as you drove the car/bike off the lot. Nowadays, you can be upside down for several years. Not a good change if you ask me. Gap insurance is just another drain on resources that could be going to pay off the car/bike.