Getting a car insurance is an absolute must for people who drive them on daily basis. By simply paying a certain amount of money, you can be sure that even in the case of an accident, the damage is going to be covered. However, the number of car insurances you can choose from is huge. This is the reason why in this article, we are going to take a look at everything you need to know about the automobile GAP insurance. Unlike other types of insurances, this is optional and you do not have to get it.
However, despite being an optional insurance, the benefits you are going to have after getting it, are well worth it. The automobile GAP insurance means that in a case when your loaned vehicle has been totaled or stolen, the insurance company is going to help you pay back the money. Many people refer to this type of insurance as a loan GAP coverage. But you must be aware that not everyone can get it. You have to be the original leaseholder or loaner of the vehicle to be eligible for such insurance. It is worth noting that people usually get this type insurance alongside others.
As we said, the GAP insurance is always used in conjunction with comprehensive coverage and collision coverage. This basically means that in the case of a covered claim, these two types of coverages will help you pay for the totaled or stolen vehicle. The sum that is going to be paid is going to be the sum of the depreciated vehicle. Keep in mind that all brand-new vehicles once taken out of the dealership, decrease in value by 20% during the first year of ownership. But what happens in the case where you own more than the deprecated value of the vehicle?
Well, this is where the GAP insurance comes into play. This insurance is activated when you own more money than the actual value of the car. The difference between these two amounts of money is going to be paid by the GAP insurance. Another thing to consider is that different countries have different interpretations on totaled vehicles. This is something you are going to have to check with your local state laws. The best way to obtain this insurance is from the first moment you buy a car. You can get it afterwards but it is much more complicated.
If you want to get the insurance after you have purchased the vehicle, the outcome is going to depend on the model year of your car. You also must know that this insurance is not simply offered at the car dealerships. The first opportunity to get this insurance can be found at your insurance company, alongside all the other insurance policies. Many are wondering whether it is worth getting one. The answer to this question is quite simple; yes, it is. Paying extra amount of money for your leased vehicle is nothing compared to feeling safe no matter what happens to your vehicle.