What is the term for the difference between the actual cash value of a car and the outstanding loan balance at the time of loss?

The correct term for the difference between the actual cash value of a car and the outstanding loan balance at the time of loss is known as "Gap." This concept is particularly relevant in car insurance contexts where an insured motorist may find themselves in a situation where their vehicle is totaled or lost, and the insurance payout based on the actual cash value is less than what they owe on their loan.

The term "Gap" specifically refers to this discrepancy, highlighting the financial gap that can leave the insured responsible for paying off a loan without having the vehicle to show for it. This is why gap insurance is often recommended; it helps cover this difference, ensuring the policyholder isn’t burdened with additional debt after a loss event.

The other choices pertain to different insurance concepts and are not applicable in this context. "Premium" refers to the amount paid for an insurance policy, "Value Adjustment" is not a standard term used in this context, and "Underwriting" relates to the process of evaluating risk and determining policy terms and pricing.