What Is Automobile GAP Insurance

Reader’s Question:

What is automobile GAP insurance?

David

Detroit MI

Automobile GAP insurance can protect your car during the early years of your its life if you have a loan or a lease.

In case of an accident or loss, automobile GAP insurance will pay the difference between the market value of the car and the current amount you still owe on your lease. Gap Insurance provide protection on your car lease or loan. Usually it also pay car insurance deductible.

If your car has been totaled due to accident, theft, fire, flood, tornado, vandalism, or hurricanes your insurer will typically pays the market value of the car. It may be less than its actual retail value. Usually it is considerably less than the outstanding balance on your loan or the amount due for a lease payoff.