Selling More GAP Policies Starts with Better Questions
GAP insurance is a tough sell for many car buyers and has been for years. As a product generally backed by insurance companies, some states don’t allow it to be sold at all for regulatory reasons that would be too much to get into here. But suffice it to say, GAP garners strong opinions among buyers.To sell GAP, it’s important to drill down with the buyers in F&I to get them to see the benefit of this coverage. Car buyers are already told they don’t need it or that their insurance company already offers it but if you are armed with the right qualifying questions, your GAP penetration can increase easily.
The top qualifying questions/scenarios for GAP are:
- How long do you need to finance the vehicle?
- Are you putting a substantial amount down or going with 100% financing?
- Are you rolling over negative equity from your trade-in?
- Are you buying a luxury or exotic car that may have a higher depreciation rate?
- Do you have to meet a deductible with the GAP plan offered through your insurance company? (this helps you close at a higher rate if your GAP plans have no deductible).
- Do you have the funds available if you have no GAP coverage to help pay off the balance that insurance doesn’t cover?
F&I managers are trained to recognize the opportunities to recommend GAP coverage to buyers but it’s still important to have open-ended and thought-provoking questions ready to help illustrate the need to add GAP. And if nothing else, asking the right questions can help you snatch that sale back from online sources such as their car insurance company or their credit union (if financing that way).
If sold properly, GAP can be a homerun, high margin add to most deals (especially with higher new cars prices). Don’t shy away from asking any or all of the questions above to help add to a healthier bottom line.
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With the extra effort necessary to sell GAP, it’s important to look at the current process for qualifying a buyer for GAP prior to presenting it on the menu. Is your staff taking the time to really assess whether or not GAP is the right fit? What information can be examined ahead of time to better prepare for the qualifying questions necessary to close more policies?
For those in F&I the sale of Guaranteed Asset Protection (GAP insurance), there are some fresh ways to approach the customer that may not be so difficult or awkward.