Gap Auto Insurance

Gap auto insurance is the solution to quick depreciation of cars. Let's say you purchase a new car today for $28,000, but by the time you drive it around for the day, the actual value of the car dropped to $22,400. If you get into a car accident, your insurance company will pay $22,400, the depreciated value of the car.

You won't get paid the amount you originally paid for it. If you don't have gap auto insurance, you'll lose money. However, if you carry that optional coverage, you can get enough money to pay for another car at the same or lower market value. It's up to you. If you lease a car, gap auto insurance is not optional. You will pay for it as part of your car lease agreement.

Avoid losing money by purchasing gap auto insurance

Car lease companies require gap auto insurance because they don't want to lose money on their investment. Likewise, motorists should apply the same sound financial principle if the car is worth it. If your car is not worth much, either the actual value or the fair market value, or if the difference between the two is not significant, then gap auto insurance may not be the best option. However, if the opposite is true, then not having gap auto insurance is not a sound financial plan, when you compare your loss on the difference with monthly premiums for coverage.

Where to get gap auto insurance

Car dealerships offer gap auto insurance at the time of purchase, but this does not give motorists much flexibility. The rates you're likely to be offered are often high. Also, you might decide that you want this coverage on a used car where no car dealership is involved. It's important then to find another away to buy gap auto insurance, at your convenience, and without the pressure of making a decision on the spot at a car dealership.

Request a free quote for supplementary auto insurance today!