Purchasing Automobile Gap Insurance


Some people believe automobile gap insurance is a scam but nothing could be further from the truth. While purchasing gap insurance is just as risky as purchasing any other type of insurance you'll find that the benefits far outweigh the risks of going without it altogether.

What is Automobile Gap Insurance?

Automobile gap insurance is a special type of coverage that ensures you are able to pay off the remaining balance of your vehicle loan or lease if you find yourself in a situation where your car is totaled and you owe more than the car is worth. Unfortunately, this is a situation that happens frequently, especially since cars tend to depreciate faster than you can pay down a loan on a new vehicle.

If your car is totaled in an accident your regular car insurance company will be responsible for paying the blue book value of the vehicle to your finance company. Under normal circumstances you would have to pay the difference out of pocket but if you have gap insurance you will simply file another claim and the difference will be paid.

Is Automobile Gap Insurance Expensive?

Traditionally speaking, automobile gap insurance isn't incredibly expensive. When you're sitting at a dealership signing loan documents, however, adding another $300-$500 to your total balance may seem a bit overwhelming. In reality, though, you'll only pay this premium one time and it will cover you for the entire life of your loan.

The problem is that some car dealerships try to rope drivers into purchasing gap insurance by bundling it in with other add-ons, thus increasing the total price of the loan and confusing drivers as to the cost of the coverage itself.

Is Gap Insurance Worth the Price?

Imagine getting into an automobile accident, having your car destroyed, and still owing money on the loan. If you have automobile GAP insurance you won't have to worry about the balance of the loan and can go out and buy a new car. If you go without gap insurance you may have to pay money towards the loan balance even though you no longer have the vehicle, thus hindering your ability to go out and get a new car. Use our site to request a quote for automobile gap insurance before you purchase it from your new car dealer. You may just find a more affordable option is available!

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