If I have a comprehensive or third party, fire and theft on my vehicle, what happens (in the event of a total loss) if the loan on my vehicle is more than the market value determined by my insurance company?

October 30, 2020

There could be any number of reasons for this including increased interest rates and or pledging your vehicle as security on a personal loan or others. We are only obligated to pay you the market value of your vehicle at the time of loss and not the loan balance payable to your bank. Your bank is likely to hold you personally responsible for any shortfall in such cases.