What Does Gap Insurance Do?
If you’re in the process of purchasing a new car, there’s a good chance that you’ve heard the term “gap insurance” being thrown around. If you’re not completely sure if this additional insurance is right for you, you’re certainly not alone, but we think it’s a smart choice for any driver who’s chosen to finance or lease their next vehicle near Roseville.
So, what does gap insurance do? Since depreciation is a fact of life, many drivers owe more on their loans than their vehicles are actually worth. In the event of a crash, normal collision coverage will only pay out your car’s real estimated value, or sticker price minus depreciation. With gap insurance, your insurer will also pay the difference between these values, so you can get out from underneath the loan if your vehicle is totaled.
What Does Gap Insurance Cover?
Gap coverage can help get you back on your feet after a collision occurs, but it’s important to clearly distinguish between what it does, and what it does not cover. If your vehicle is damaged or totaled by any of the following, you’ll be protected by your gap insurance:
- Fire, or other acts of nature
Gap coverage only protects your vehicle; it has nothing to do with bodily injuries or other properties. What’s more, gap protection will not secure you against engine failures and mechanical malfunctions. It will also not protect you in the event of the loan holder’s death. When it pays out, gap coverage will not reimburse you for your deductible.
Do I Need Gap Insurance?
Gap insurance is not required by law, but it does come highly recommended by the experts. When you make a purchase on a new or a used vehicle, a representative from your dealership will go over all of your financing and insurance options with you, and you’ll also have the opportunity to discuss gap insurance.
In general, drivers who choose gap insurance do so because they want to enjoy true peace of mind. Without this type of insurance, a car accident could leave you underwater on the remainder of a car loan that you’ll still be responsible for, making it more difficult to move forward with your life.
Talk to an Expert at Kareem Auto Sales Inc!
Whether you’re in the process of purchasing a new car, curious about used car leasing, or just filling in the gaps in your knowledge, the experts at Kareem Auto Sales Inc are here to help! Folks from all over the Folsom and Rancho Cordova areas come to us when they’re looking for help, so don’t hesitate to contact us. We can teach you how to trade in your car and how to identify used vehicle red flags today!
More From Kareem Auto Sales Inc
At Kareem Auto Sales Inc, we sell only the finest quality used vehicles that are guaranteed to impress. However, every vehicle – even the newest ones on the showroom floor – needs to be serviced on a regular basis. And only if you maintain your car on a regular schedule, you can be sure that it will run…
The Honda Ridgeline is a real midsize pickup truck, and it can tow heavy loads with the best of them! Even in its baseline configuration, with two-wheel drive, the Ridgeline can tow up to 3,500 pounds. With AWD, this Honda truck can handle up to 5,000 pounds on the roads near Folsom and Rancho Cordova. That…
Many drivers wonder about the difference between used and certified pre-owned vehicles when they’re beginning to search for their next car. Both of these types of vehicles are technically “used,” but there are important differences that drivers in the Elk Grove area should definitely be aware of! Before you make a decision on your next pre-owned…