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Frequently asked questions regarding Gap Insurance.
Automobile Gap Insurance
Automobile gap insurance is an interesting development in the world of car insurance. This specific type of insurance came into being primarily because of the ever-rising costs of new cars. In the early 1980s, car dealerships began offering "gap" or "guaranteed asset protection" insurance as a way for consumers to ensure that should their car be totaled, they would have a means for covering the difference between the car's actual worth and what its current "fair market" value might be.
It is a well-known fact that cars lose their value as soon as they are driven off the lot, but many aren't aware that a car can lose as much as 20 percent of its value immediately! When you still owe $20,000 on a car loan, but the insurance company says the totaled car is only worth $15,000, the company that you obtained your car loan through is not going to simply "write off" the $5,000 difference.
If you have ever leased a car, then you have most likely been forced to pay for gap insurance. You may not have even been aware of it, as it is sometimes simply included in the cost of the lease. Companies who lease cars simply have to protect their assets, and part of that protection includes making sure that the difference between the fair market value of the car, and what they paid for the car is covered by a good gap insurance policy.
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Hunting for Good Gap Insurance
At Gapinsurancequotes.com we offer a unique take on the entire gap insurance paradigm. Most often gap insurance is only available through a dealership at the time of purchase. We offer consumers considerable leverage in terms of when they want to buy their gap insurance. We also offer gap insurance for less than conventional situations e.g., for used and refinanced cars. Feel free to e-mail or call us with any questions or concerns you might have regarding gap insurance in Massachusetts, or automobile insurance in general.
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Auto Gap Insurance
When it comes to gap insurance, there are a few things the savvy consumer needs to know. Gap insurance is separate from your regular car insurance and helps cover the difference between a totaled or stolen car's actual value and the remaining balance of the car loan. In short, if you total a car you still owe $17,000 on, the insurance company may say the car was only worth $15,000 due to the immediate depreciation as soon as the vehicle was driven off the lot. Gap insurance will cover the difference so you don't have to pay for a car that you no longer have use of.
Gap insurance is usually offered at car dealerships when you are purchasing an automobile. The dealership will generally tell you that you can either purchase the gap insurance then, or not at all. This is not quite true, though! Fortunately for smart consumers, there is a wider window of opportunity for gap insurance purchases.
At gapinsurancequotes.com, we offer drivers the ability to purchase gap insurance up to 12 months after they have purchased their car. We even offer gap insurance for used and refinanced vehicles! This means you can purchase gap insurance (within this 12-month time span) if have either purchased a new or used vehicle, or you have refinanced your current vehicle.
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Searching for the Best Price
If you have ever priced gap insurance at a car dealership, you have probably been given quotes in the $500 to $700 range. Those figures are simply too high for many of us, and luckily, there are more cost-effective options available. At gapinsurancequotes.com, we offer comprehensive gap coverage insurance for only $399. When it's this affordable, there's no reason not to invest in gap coverage.
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Car Gap Insurance
It has been reported that as many as nine out of 10 people have never heard of gap insurance. This is perhaps due in some part to most people's general aversion to discussions about insurance. Regardless, the simple fact remains that gap insurance can be a powerful tool for consumers, especially in today's market.
More and more car loan companies are allowing consumers to purchase automobiles with little or no money down. While this is a great boon to those who simply do not have the funds to put 20 percent or more down on perhaps a $20,000 vehicle, the downside is that it puts buyers in a potentially dangerous financial situation should an accident or theft occur. If you cannot afford the $4,000 down payment on the above mentioned vehicle, then you are even less likely to cover a fair market value to actual cost gap of $5,000 or more.
There is an interesting mathematical relationship between the length of a car loan and the gap between fair market value and actual original cost. The gap between these two amounts is at its absolute greatest the very moment one drives a new car off of the dealership lot. During this brief time span, before a significant number of payments have been made, the difference between actual cost of the vehicle and the fair market value of the vehicle can be as much as 20 percent or more.
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Making the Upside Down Right Side Up
Being "upside down" is a condition wherein one owes money on a piece of property that no longer exists, or no longer has value. Gap insurance protects consumers against this unfortunate financial position. At Gapinsurancequotes.com, we offer a unique take on gap insurance. For a one-time payment of $399, you can get full coverage gap insurance on new, used, or refinanced vehicles that have been purchased within a 12 month period.
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Coverage Gap Insurance
Choosing an automobile insurance policy can be difficult at best. Determining the amount of coverage you need, what you want your deductible to be, and whether or not you need gap insurance coverage are all important decisions that can greatly affect your future financial situation. If you are considering gap insurance, there are a few questions you might want to ask yourself.
First and foremost, are you financing your automobile for longer than 24 months? Long-term automobile loans provide the riskiest situation in terms of negative equity potential. There are car loans now that stretch up to 72 months or more in order to help perhaps less than qualified consumers purchase the cars of their choice.
Another question you might want to ask yourself when considering whether or not to purchase gap insurance is whether you'll make a down payment of at least 30 percent of the car's value. The less of a down payment that you make, the larger the potential gap between the fair market value of the car and what you still owe on your loan. It is becoming commonplace for car buyers to put down as little as zero percent of the car's purchase price, and this can put consumers in a particularly risky financial situation should an accident or theft occur.
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A Lower Cost Gap Insurance Option
One of the main reasons consumers opt out of purchasing gap insurance is that it can cost as much as $700 at a car dealership. At Gapinsurancequotes.com we offer excellent gap insurance coverage for less than half that amount! Additionally, we offer a flexible gap policy that can be purchased not only for new cars, but for used and even refinanced cars as well. To protect your investment, go with Gapinsurancequotes.com.
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Gap Coverage
Gap insurance coverage is a topic that many find to be confusing. This is perhaps because consumers generally only hear about gap insurance when they are at a new car dealership. By the time you've have haggled with salespeople and finally decided to make the commitment to buy a car, you probably do not want to think about tacking on what looks like merely an additional cost.
Having good gap insurance coverage can be a real lifesaver, though. As an example, let's say that you purchase a car for $30,000. If you total that car while you still owe $25,000, then you might think that your insurance company is going to cover the $25,000, no questions asked. The truth is, though, that they are only going to pay out what the car's current value is. If it is only worth $22,000 due to immediate depreciation, you are then responsible for paying the remaining $3,000 on a car that you don't even have. This is unreasonable and easily avoidable.
Gap insurance tries to correct this situation by covering the "gap" between what you owe and what the car is worth. This is why gap insurance is traditionally only available when you are purchasing a new car. It might interest you to know that at gapinsurancequotes.com, you can buy real gap insurance up to 12 months after you have purchased your new or used vehicle. Our goal is to help drivers find the most affordable and comprehensive coverage there is.
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Is It Available in Your State?
You should be aware that gap insurance is not actually available in all states. For example, you cannot have gap insurance in CT, LA, NH, NM, NY, VA, VT or WA. It is also worth noting that the gap insurance we offer at gapinsurancequotes.com is not valid for loan terms that are greater than 84 months. This should not be an issue in most cases, since most loans do not go beyond the 60 month range. To prevent your investment from being a liability, gap insurance is the ideal solution.
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Gap Insurance
Auto insurance in general can be quite confusing to consumers looking for the absolute best coverage for the best price. Between policy rates, coverage, and payment plan options, it's difficult to know what the "best" deal is. When it comes to gap insurance in particular, many consumers are not "in the know."
Gap insurance gets its name from its basic function. When you purchase a car, its value immediately decreases. In the case of a new car, the value can depreciate by as much as 20 percent when you drive it off the lot. If you happen to total your new car, or perhaps if it is stolen, your insurance company is not going to cover what the sticker price of the car, but rather, they will pay off what the car's current value is.
This means that if you happen to have bought a car that costs $25,000, and then you total it when you still have $20,000 left to pay on it, traditional insurance may only cover $17,000 of the car's cost. That's before you include your deductible, which might be around $500 or so! In this scenario, you still end up still owing $3,500 to the car dealership or whoever you obtained your financing through.
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Searching for Gap Insurance
Finding a good source for gap insurance can be difficult. Fortunately, at gapinsurancequotes.com, we can provide you with a quick resource for high quality gap insurance. We charge only a one-time fee of $399. Other gap insurance providers commonly charge anywhere from $500 all the way to $700 for the same coverage. At gapinsurancequotes.com, we strive to provide our customers with both low rates and great service.
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