Wednesday, December 18, 2013

Loan/Lease GAP coverage

What is GAP coverage?

 
Buying a new car this holiday season? If you are, this may be a good time to review the coverage limits on your auto policy. One coverage that you should look into if you are purchasing a brand new vehicle is GAP coverage. 

You've probably heard that your car depreciates in value as soon as you drive it off the lot. Well, what if a week after you drive your brand new car off the lot you get into a wreck and total your car? You could be left holding the bill for the difference in the depreciated value of the car and the money you still owe on your auto loan. That is where GAP coverage will fill the gap between the depreciated value of the vehicle and the amount you still owe on the loan.

Sometimes GAP coverage is included in your loan or lease agreement. It is a fairly inexpensive additional coverage that could wind up saving you a couple thousand dollars, so it is worth checking into!