Is Gap Insurance Worth It?

Guaranteed Asset Protection (GAP) insurance helps to cover the costs you may face if your car is totaled. When you buy a new car, you can choose to strengthen your coverage by adding gap insurance. If you’re not sure whether gap insurance is worth it, read the guide below from the friendly finance team at Bowman Chevrolet to get the details you need to make the right choice.

What Is Gap Insurance?

If your car is declared a total loss after a collision, you’ll still owe the dealership the cost of the car. Your primary insurance will cover most of this cost, but you will owe money out-of-pocket if your vehicle’s current cash value is less than what you still owe.

Gap insurance helps to cover that gap. Whether you have a lease or loan, gap insurance is coverage you may want to consider. You can learn more about how gap insurance works in our separate, general guide to this optional type of coverage.

Do I Need to Have Gap Protection?

While gap insurance is not legally required for Clarkston drivers, you may still wonder if gap insurance is worth it. For many, the answer is yes. Here are just a few reasons that Waterford-area drivers choose to add gap protection to their coverage:

• No matter what type of new vehicle you buy, depreciation begins as soon as you drive off the lot.
• Accidents can happen at any time — whether your car is brand new or you’ve been driving it for many years.
• Your auto insurance provider will only cover the market value of your vehicle at the time of the accident.
• Gap insurance comes with a low cost and is very easy to obtain, so at the end of the day, it’s worth it for the peace of mind alone!

How Much is Gap Insurance?

The average gap insurance cost depends on where you acquire it, and there are several ways to purchase gap insurance in the Grand Blanc area. Learn more about where to buy gap insurance and how much you can expect it to cost, below:

• Purchase from your current insurer – If you already have auto insurance (such as liability, comprehensive, and collision), you can purchase gap insurance from them for about $20 a year.
• Add coverage to your car loan – Some lenders will allow you to add gap insurance coverage to your new car loan as a flat fee. The gap insurance cost for this option ranges between $500 and $700.
• Purchase standalone gap insurance – Your insurer may not offer the option to add gap insurance to your coverage plan. In this case, you may be able to purchase it on its own for a flat rate of between $200 and $300.

Learn More About Gap Insurance at Bowman Chevrolet

Questions about where to buy gap insurance? The finance professionals at Bowman Chevrolet are here to help. Contact us online or call us directly at (248) 575-5000. While you’re at it, be sure to inquire about our new vehicle specials so you don’t miss out on great savings. If you have any additional auto finance questions, consult our car-buying tips for more advice you can trust!