Importance of GAP Insurance

The coverage you're having cannot totally protect the expense of the car in some case where it gets damaged beyond repair. In case of any accident, you would only get the market price of your car which could turn out to be 20 or 30 percent lower than the cost price.

When this is the condition, GAP insurance plays its role. The fact is that it would cover the money you continue to owe to the loan company at the time your car has been completely wrecked. This car insurance coverage refers to Guaranteed Auto Protection. This is the coverage between the price of the car and how much you are indebted on a car.

It is an additional coverage that would protect you as it would pay the outstanding balance providing you with a clear record with your present vehicle lender. Then you could still have the chance of borrowing from the same lender again.

It is important in more or less all cases. You need not worry about the rates as GAP is relatively low cost. You require this at the time you're buying or leasing any new car which must not be taken for granted to reduce costs. You must ask your insurer to add the amount to your coverage at the time you purchase for a policy.

You can already have GAP with your present insurer that would insure you for the inconsistency between the amount of your loan on the car and the actual market price of it. But in a few cases, all companies do not offer GAP. You might get it through dealership but if it's not available then you can search online. There are several online GAP auto insurance companies where you can get what you want.

You usually find GAP coverage as authorized by lease contracts. If it is included in the lease, check out how much is obtainable and how much you would be paying.

As a motorist, getting the cheapest car insurance is feasible provided that you make it a point that your property is entirely covered. You must know the type of coverage you're getting as well as the sum it offers. Full coverage over Liability must be considered and adding GAP insurance would definitely give you further protection if something goes wrong with you or to your brand new vehicle.

Refund GAP Insurance

Car GAP insurance will cover the "gap" between what your auto insurance does not pay and what you still owe on your car loan. Remember, when you drive a new car off the lot, its value depreciates rapidly. But you will still owe for the value of a new car. Therefore, GAP insurance can protect your investment in the event of an accident, and this is even more important if you are leasing a car. The last thing you want is to end up with a big payoff amount and no vehicle to show for it. Consider protecting yourself ahead of time. It is not that expensive when you think about the alternative.

The cost of car GAP insurance is not much more than you will be paying for auto insurance anyway. Yet it could save you thousands. You will have to pay a percentage of your total premium or a percentage of the car's sticker price to buy the added coverage. But it should be well under a hundred dollars on an average car, sometimes in the range of $30 and maybe even lower. Don't wait until you need this added coverage to educate yourself on its importance. For a reasonable fee, you can ensure that your new car is protected. It's a small price to pay for peace of mind.

If you decide that car GAP insurance is for you, shop around and choose the rate you are most comfortable with, whether that be through your own auto insurance company, the dealership, or some other outfit. Ask them to explain their policy regarding refund car GAP insurance, as well. Should you ever need a refund for your GAP insurance, say, if you wrecked your car before your current insurance term ended, you may be eligible for a refund on the portion not yet absorbed. Another thing to keep in mind is that the insurance commissioner for your state is there to help you if there is ever a dispute between you and your insurance company; however, you have to protect yourself first buy purchasing the appropriate insurance and then by making the insurance payments in a timely manner.

The benefits of purchasing car GAP insurance outweigh the reasonable cost and will offer you peace of mind when you drive your new car off the lot. Cargapinsurance.net offers valuable information regarding car gap insurance policies in which your interests are completely protected in case your new car is ever totaled.

Gap Insurance

Gap insurance provides coverage in a variety of circumstances when a car is severely damaged or stolen. It pays regardless who was at fault in an incident. For example, if you were to be involved in a total loss collision a few months after purchasing a vehicle and you had purchased collision and gap coverage, your collision coverage would pay for the estimated market value of the vehicle. Gap coverage would then pay the additional amount between what was paid to the insured under collision coverage for the total loss vehicle and the amount that is still owed to the lien holder for the vehicle.

Another example would be if shortly after purchasing a new car you were involved in an accident where a deer jumped out in front of you car resulting in a total loss, gap insurance would also help pay for your loss. You would need comprehensive coverage to pay for the appraised value of your car, and then gap insurance would pay for the remaining amount still owed to your lien holder.

Gap insurance can save you a lot of money. The difference between the appraised value and the amount remaining on a loan can be a considerable sum. In the absence of gap coverage, you could be personally responsible for thousands of dollars still owed on your vehicle to your lien holder. It is well known that a new vehicle can lose several thousands dollars in value as soon as it driven off the dealer lot.

Some vehicle owners do not realize how important gap insurance coverage it is until it is too late. They may think their brand new car has a lot of value with nothing to worry about. Purchasing a new vehicle without gap insurance can be very irresponsible.

Gap coverage will also take effect when a vehicle loss is caused by accident, theft, flood, fire, vandalism, tornado, or hurricanes. Auto loans are typically front-loaded in the sense that interest payments amounts are highest in the first few years of vehicle ownership.

After a few years of owning a vehicle, as the remaining loan balance owed on the loan falls below the market value for your vehicle, you can drop your gap insurance as it no longer makes financial sense to have the coverage.

Gap insurance rates can vary amongst insurance companies. It is important to shop around to get the best price. Be sure to read your auto policy carefully to determine any exclusions or limitations on gap coverage. Since it is a very distinct form of coverage, a vehicle owner can purchase gap from a different carrier than their auto liability insurer.