Posts Tagged ‘GAP Insurance’

Car Insurance Myths

Monday, April 23rd, 2012

An insurance policy can seem like a maze of mysterious factors leading to your premium and a complex array of different rules as to what is covered. You’ll find that car insurance rates vary widely from place to place, but some things are standard across the board. The best you can do is have realistic expectations for your policy. Beware: believing one of the following common car insurance myths could end up costing you a lot of money and aggravation!

Myth #1: Car insurance covers me if my car is stolen or vandalized.

Only people with comprehensive coverage will be protected in the event of theft, fire, hail damage, or intentional damage from vandals. Most states only require liability coverage to protect others from damage you’ve caused. If you hit a deer while driving, your collision coverage will take care of that. However, if your car is at rest and your dog jumps up, swiping his paw across the door, you will not be covered — unless you have comprehensive coverage.

Myth #2: Insurance will pay off my loan if my car is totaled.

A car is determined “totaled” when the cost of repair exceeds the car’s value. Many people are excited by the possibility of receiving a large sum of cash, but they must keep in mind that this isn’t all money in their pockets for a new vehicle. They will factor in depreciation, but you will be responsible for paying the outstanding amount due on your original vehicle loan. The only way to be fully protected in this scenario is to purchase “gap insurance.”

Myth #3: Car insurance pays for rental cars if my vehicle is damaged.

Not all car insurance automatically covers the use of a rental car. Many policies will let you add this optional coverage for an extra $1-2/month. Often when you are seeking car insurance quotes and selecting your preferred level of coverage, you will see this question come up. Keep in mind that  there are limits for how much you can be reimbursed for rental cars too. For instance, GEICO only reimburses you up to $25 per day to a limit of $750 per accident.

quotes for car insurance

Think you're guaranteed a rental car? Presume you'll walk away with $5,000 to buy a new car, even though you're still paying on your loan? Guess again! Check for car insurance quotes to dispel a few common myths.

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Posted in Car Insurance Rates, Discount Car Insurance, General Car Insurance |

Should You Buy Gap Auto Insurance Coverage?

Saturday, July 23rd, 2011

Are you wondering whether you need to add gap auto insurance coverage to your policy provisions? If you are interested in buying or leasing a new car, it’s a good idea to put this type of protection in place.

Gap insurance fills in the gap in coverage between what you owe on the car and what it’s worth. Physical damage coverage on a vehicle, which includes collision and comprehensive coverage, pays out based on the vehicle’s cash value. It doesn’t compensate the owner for what he or she paid for the vehicle or how much it would cost to replace it.

Since  a car’s value depreciates from the moment the owner takes possession of it, it’s possible for someone to owe more on the vehicle than what it’s worth. If the car were totaled in an accident or stolen and not recovered, the insurance would write a check based on the car’s current value less the deductible the policyholder has agreed to pay.

If the amount is not enough to pay off the existing loan or lease, the owner will have to make up the difference personally. Having gap insurance in place protects the owner from having to pay this amount. Depending on the policy chosen, the insurer may also compensate the policyholder for the collision or comprehensive deductible.

Anyone who is driving a new car can benefit from putting gap insurance coverage in place. It is a low-cost way to avoid having to pay for a car that is totaled or stolen.

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Posted in General Car Insurance |

Do You Need Gap Vermont Auto Insurance Coverage?

Sunday, January 30th, 2011

If you are in the market for a new vehicle, consider adding gap Vermont auto insurance protection to your policy. This type of coverage can benefit consumers who are buying or leasing a vehicle. If you take out a loan to pay for your vehicle, its value will depreciate faster than the amount you owe on the loan or lease. Gap insurance coverage is meant to make up the difference between your car’s cash value and what you owe on it.

When you are involved in an accident, your collision and comprehensive coverage doesn’t pay out based on what you paid for the car or its replacement value. Instead, you are covered for your vehicle’s cash value only. It’s possible to be involved in a total loss accident and have your insurance company pay a benefit for your car and still owe the lender some money.

Rather than have to continue making payments on a vehicle you no longer own, consider buying gap Vermont auto insurance coverage instead. This add-on protection is available from the dealer, but you can also shop around to find out how much you would pay for it from a private insurance company.

Make a point of asking that the cost of gap insurance coverage be included in your Vermont car insurance quotes so that you get the right level of protection for your new car. By comparing rates from several providers, you will be able to find the best deal on your insurance.

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Posted in Vermont |

Washington D.C. Gap Auto Insurance

Monday, January 10th, 2011

If you took out a loan to pay for your car, you should also consider buying Washington D.C. gap insurance coverage. The lender probably insisted that you have collision and comprehensive insurance in place to protect its investment if a loss occurs. Gap insurance coverage is designed to protect you from loss.

Collision and comprehensive coverage pay out based on your car’s cash value, not what you paid for it. As soon as you drive it off the lot, it starts to depreciate and that’s where the gap insurance coverage comes in.

This type of coverage fills in the gap between what you currently owe on the vehicle and its cash value. Buying it means that you aren’t going to be stuck making payments on a car that has been totaled or stolen, simply because you owe more on it than its current cash value.

You may be offered Washington D.C. gap insurance coverage when you buy or lease your car, but you will probably be able to get better rates by purchasing it from an insurance company directly. Be sure to compare rates to make sure that you are getting the best possible pricing for your coverage.

Rather than feeling pressured to make a decision about gap insurance at the dealership, a better choice is to start looking for this coverage before your buy your new car.

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Posted in Washington DC |

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