Q: Will gap insurance pay for totaled vehicle if auto insurance does not pay for the claim?

A: In California, if your auto insurance refuses to pay for damages because a driver (in this case, your son) was excluded from the policy, GAP insurance typically does not cover the outstanding balance on the vehicle loan under these circumstances. GAP insurance is designed to cover the "gap" between the vehicle's actual cash value (covered by your standard auto insurance) and the amount still owed on the loan or lease if the vehicle is totaled or stolen. However, if the primary auto insurance does not pay out due to the driver being excluded from the policy, GAP insurance generally does not act as a substitute for comprehensive or collision coverage.

A: In the context of an auto insurance claim in California, GAP (Guaranteed Asset Protection) insurance plays a specific role. It is designed to cover the "gap" between the amount owed on a vehicle loan or lease and the vehicle's actual cash value, which is what traditional auto insurance policies pay out in the event of a total loss. However, GAP insurance typically requires that the primary auto insurance policy first pays out a total loss claim before it can cover the remaining balance owed to the lender.

If your primary auto insurer, in this case, AAA, refuses to cover the damages because your son was excluded from the policy and therefore not covered at the time of the accident, this creates a unique challenge. Without the primary insurance claim being paid, GAP insurance may not activate, as its coverage is contingent upon the primary insurance's total loss payment. It's designed to supplement, not replace, the coverage provided by your auto insurance policy.

Given your situation, it's crucial to review the specific terms and conditions of your GAP insurance policy. Some policies might have clauses or exceptions that could potentially provide coverage in unique circumstances, but this is not the norm. Seeking advice from a professional familiar with insurance laws and policies in California may offer you guidance on any possible options or next steps you can take in this challenging situation.