Before you you got your car on a complete loan, did you ever wonder that for example you got involved in a serious automobile accident and the car got completely destroyed, how you will be able to pay the car dealer his complete money since your normal car insurance will only cover for about 89% of car price?. It is in this kind of situation that GAP insurance got you covered. GAP insurance, what is GAP insurance? One may ask.
What is GAP insurance
GAP is an acronym for guarantee asset protection. GAP insurance is an insurance protection https://howtodiscuss.com/t/business-liability-insurance/15786. that covers the difference between what you owe your car dealer and what your car insurance company will settle for in case of total destruction https://howtodiscuss.com/t/destruction/14090. to the car.
Summary
GAP insurance is an insurance protection that covers for the difference between what you owe the car dealer and what your car insurance is willing to settle for in case of total destruction to the car.
Why GAP insurance
Your normal car insurance company https://howtodiscuss.com/t/insurance-company/15562. doesn’t cover 100% the price the price you bought your car from your dealer https://howtodiscuss.com/t/dealer-cost/10131. It only covers for about 80%. If you have gotten the car completely on loan then you will need GAP insurance to cover for the remaining 20% in case of a total damage to the car maybe via an accident or anything. That’s why you need GAP insurance. YOU NEED GAP INSURANCE ESPECIALLY WHEN YOUR IS PURCHASED ON COMPLETE LOAN https://howtodiscuss.com/t/completion/16575. OR WHEN YOU OWE MORE THAN YOUR NORMAL CAR INSURANCE CAN COVER
Summary
You need GAP insurance if you purchased your car on a complete loan or if you owe more than your normal car insurance can cover.
Who shouldn’t get gap insurance
If you owe less than your car is worth then
Is gap insurance worth it?. you don’t need GAP insurance. For example you purchased a car https://howtodiscuss.com/t/purchase/13913. on loan for $25 but you’ve paid $15 from it already so you’re owing just $10, if that car is involved in a very terrible accident and the car is destroyed… what your normal car insurance
https://howtodiscuss.com/t/how-much-is-car-insurance/15885. is going to give should be able to cover for the $10 that is remaining, because you’ve already paid part of the car loan What Does Gap Insurance Cover. yourself before… IN THIS KIND OF SITUATION YOU DON’T NEED A GAP INSURANCE. Those who owe less How Much Is Gap Insurance. than what their car is worth don’t need GAP coverage.
Summary
You don’t need GAP coverage if you owe less than your car is worth.
How much does GAP cost
How much GAP costs is dependent on the individual financial institution. Some financial institution charges more, others charges less…but lots of financial institutions charges the same amount for all types of vehicles WHAT IS GAP INSURANCE?. for example if a financial institution is charging $25000 for GAP, then it doesn’t matter if you want GAP for a truck or for a sport car…they are going to charge you just that $25000.
Summary
How much you pay in GAP insurance as charges in dependant on the financial institution you’re taking the GAP coverage with. But lots of financial institutions charges the same amount for all kinds of automobile.
WHAT ARE THE MODALITIES FOR PAYING
https://howtodiscuss.com/t/pay/16746. FOR GAP
Most financial institutions https://howtodiscuss.com/t/financial-institution/14566. will give you two options. They will either tell you to;
- pay the GAP http://GAP. charges https://howtodiscuss.com/t/charge/11336. upfront or
- roll the GAP charges into the loan http://loan. itself.
So you decide on which of the modalities is good for you.
frequently asked questions
Is GAP insurance also dependant on my premium?
Your insurance premium is the the probability of something going wrong. Every insurance policy is built on premium, so to say.
I’ve paid over 30% of the loan for my car, do I still need GAP?
If you’ve paid over 30% of your loan payment then you don’t need GAP coverage, because in the case of total destruction to the car, your normal car insurance will cover for the remaining 70%.
conclusion
GAP insurance is an insurance protection that covers for the difference between what you owe your car dealer and what your normal car insurance will settle for in case of total destruction to the car.