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. Or, the VPP may be offered as a way to protect the loan the 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.

Here, AWARE has defined some common voluntary protection products and outlined some areas to consider for consumers.

Vehicle Service Contracts

The most popular and the most beneficial voluntary protection product for consumers, Vehicle Service Contracts protect consumers from repair expense outside of the factory warranty period.


Guaranteed Asset Protection (GAP)

GAP (Guaranteed Asset Protection) agreements 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.


In Conclusion...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 get that education before going to the dealership’s business office or F&I (Finance & Insurance) office. Check out the dealership website, the manufacturer’s website and other car shopping sites to learn what you need to know to make an informed purchase.

You will be told what the voluntary protection products cover, but you need to ask what is NOT covered. This way you will not be disappointed 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. That is why consumers typically do not read them before signing on the dotted line. Tell the F&I manager you are looking for the 2-3 page section in the contract that tells you 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.