May 16 Coverage of the Month: Gap Replacement
Let’s say you’ve been in an accident in your new car. Your insurance coverage may not cover the full cost of replacing your vehicle or the initial loan you took out to buy the car. That’s where guaranteed auto protection (GAP) insurance comes in.
Here is an example to help explain:
Example: You buy a car for $35,000. Almost two years later, you are involved in an accident and your car is totaled. The depreciated value of the car is $11,000; however, you still owe $15,000 on your loan. GAP insurance will reimburse you in this case.
How does Gap Insurance Coverage Work?
GAP insurance covers the gap between what your vehicle is worth and what you are actually on the hook for in regard to your vehicle loan after a collision. Does GAP insurance cover theft? Absolutely.
If you have GAP insurance coverage, you can be reimbursed up to 120% of the value of the vehicle.
What is the Cost of Gap Insurance?
On average, the cost of GAP replacement for Gilbert’s valued policyholders is $30 a year.
However, the cost of GAP insurance will vary depending on a number of factors, including the value of your car. Another factor that will affect the cost of your GAP insurance is the auto insurance you choose. Not all insurance is the same, and prices can vary dramatically from one insurance provider to the next.
Talk to us about gap replacement to protect yourself against losses!
Call our office today to speak with one of our Personal Risk Advisors who can help add this gap replacement endorsement to your policy.