LOS ANGELES, May 17, 2021 /PRNewswire-PRWeb/ -- Compare-autoinsurance.org has launched a new blog post that presents the information drivers need to know about gap car insurance.
For more info and free car insurance quotes, visit: https://compare-autoinsurance.org/main-benefits-of-gap-insurance/
The moment when a driver drives off the dealer's lot with a brand-new vehicle, it begins to depreciate. Most cars lose as much as 20% of their value in their first year on the road. Drivers who own full coverage and total their cars will only be reimbursed with the actual cash value of their vehicles and not with the value of a brand-new vehicle. Gap insurance covers the difference between the car's current market value and the amount the driver owes to the lender.
Drivers who plan to get a new vehicle should know the following about gap insurance:
- How to get gap insurance. Drivers who lease their cars might be required by their lenders to get gap insurance. Policyholders can get gap insurance at an auto dealership, car insurance company, or lender. Large carriers such as Allstate or Nationwide sell gap insurance as an add-on to the collision and comprehensive coverages. However, not all insurance companies offer gap insurance.
- The cost. Usually, gap insurance costs as little as $20 per year. In many cases, car insurance companies offer the cheapest rate for car insurance.
- When to get gap insurance. When leasing a vehicle, the leasing company will require to buy gap insurance. Because automobiles depreciate rapidly, the leasing company will require the driver to carry liability, collision, comprehensive, and gap insurance to fully protect its property. Drivers who make a down payment that is less than 20% of the purchase price should consider getting gap insurance. In this case, the car's actual cash value may be lower than the amount the driver owes the lender the minute it drives away from the dealership. Also, drivers who finance their cars for more than two years should get this coverage because the difference between their car's actual cash value and the amount they owe the lender will occur quickly. Furthermore, some automobile makes and models depreciate faster than others do and are more difficult to resell. Drivers who have a vehicle that has a poor resale history or one that depreciates quickly should obtain gap insurance.
- When drivers don't need gap insurance. Drivers who finance their cars are not required to carry gap insurance for the entire loan term. In most cases, drivers can discontinue gap insurance coverage when the amount they owe is lower than the actual cash value of the care.
For additional info, money-saving tips and free car insurance quotes, visit https://compare-autoinsurance.org/
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