Understanding Voluntary Protection Products

A voluntary protection product (VPP) is any product or service offered to car buyers at the time of purchase that are sold above and beyond the actual vehicle, typically as a means of protecting certain components on the vehicle. A VPP may also be offered to protect the loan a buyer is using for the purchase of the vehicle. Below are definitions of certain VPPs and some factors car buyers should consider before purchasing a VPP.

Vehicle Service Contracts

The most popular and the most beneficial voluntary protection product for consumers, vehicle service contracts protect consumers from repair expenses outside of the factory warranty period.


Guaranteed Asset Protection (GAP)

Guaranteed Asset Protection (GAP) agreements cover the difference between the value of the vehicle and the amount owed on the loan if the vehicle is declared a total loss.


Other Voluntary Protection Products

There are a variety of other, less common voluntary protection products that may help you get the most of your vehicle financing experience.



Do your research! Most buyers today spend a lot of time researching their vehicles but very little time researching financing or voluntary protection products. It is important for customers to go online and educate themselves before visiting a dealership's business office or F&I (finance and insurance) office. Visit the dealership website, the manufacturer’s website and other car shopping websites to make an informed purchase.

Make sure you know what voluntary protection products cover and ask what is NOT covered. This way you will not be surprised when it is time to file a claim.

Agreements that you are asked to sign in the F&I office may look long and complicated so askthe F&I manager to direct you to the two to three page section in the contract outlining what is excluded from coverage.


Recognizing the need for consumer education, automotive industry leaders have formed AWARE (Americans Well-informed on Automobile Retailing Economics), a collaborative industry effort to provide consumers with information, tools, and other resources to better understand the auto financing system.