As you stated GAP insurance normally pays the balance of a loan left after a covered loss of an automobile, such as it being found a total loss after an accident or due to being stolen.

It appears you may be thinking of another type of insurance that some finance companies may bundle with loans or offer to those paying off a lease or loan called payment protection insurance.

Payment Protection Insurance will normally pay your monthly payments on any motor vehicle finance agreement, mortgage, or any type of loan if you become unemployed or cannot work due to accident or illness.

If you were to lose your job or were not be able to work for a period because of illness, you could end up losing your car because you could not afford to keep up the payments on it. This is when a payment protection insurance policy.

Payment protection is normally paid monthly, at the same time as any finance repayment. Not everyone is eligible for it; if you are long-term sick or self-employed, you probably may not be able to obtain this coverage.

If you are interested in this type of coverage go over the policy to make certain what if would pay if you were out of work. There may be a limit to how many payments are made under this plan. It may also not kick in immediately; you may have to find the money for the first three months after a change of personal circumstances (out of a job or illness so you cannot work).