Bryon, the first couple of years of a loan that long will be mostly be interest and little principal. But, the car is depreciating rapidly. You’ll owe way more on the loan than your insurance will pay, so you’ll owe the difference. You need to run the amortization schedule and see how the principal owed compares with market value. Now, your insurance company may sell you a rider to pay off the loan, but that just eats up more of that perceived savings from the low rate. And, if you did pay cash for it and you drive it a couple of months and want to sell it, you won’t get your money back. Now, think about what the principal on the loan looks like. As long as you don’t have a total loss all of that is moot.
It appears some lenders still use Rule of 78 for some short-term, fixed rate loans under 61 months, but not very common because of Federal laws and some states have bans.