I didn't even know there WAS such a thing as gap insurance....
Different states, different people (based on credit score, etc...), and different loan companies probably have different requirements. At least around me it is very common for loan companies to require some sort of gap insurance in many situations. Especially for people with lower credit scores or small amounts of loan history. Generally you can get it through your existing auto insurance company and they just add it to your premium.
Just for anybody else reading this reply, here is an example.
You buy a truck for $30,000
No down payment, no trade
Add sales tax (let's say 6.5%)
5 year loan @ 5% interest
Your payments will be $603/month for a total cost of over $36,000 after 5 years. Basically you have a truck worth $30k but now owe $36k on it when you drive off the lot. So if you total out the truck as you pull off the lot the insurance will only give you $30k but you technically owe the loan company $36k. The gap insurance would then kick in and pay the extra $6k that is owed. Sure, there could be factors like no penalty for early buy out, meaning less interest paid and lower total cost, but this is to get the point across of what gap insurance does.
To go another step, let's say you drive the truck for a year and then total it. After making 12 payments you still owe $29k on the truck that was originally purchased for $30k. Most likely the truck has depreciated way more than just $1k in that years time.
Assuming you paid reasonable market value for the truck (i.e. not some great deal) and take a loan out at typical rates, and the vehicle has normal depreciation......this means that you will owe more money than what the vehicle is worth for at least several years into the loan.
