What Is Gap Insurance & Is Gap Insurance Worth It?

Buying a new car in Georgetown or Cameron can seem like a daunting prospect, especially if you’re worried about your car being financially underwater at the time of an accident. Gap insurance coverage can help! What is gap insurance on a car? This add-on when buying a new car covers the difference, or gap, between what your insurance company will pay for your vehicle and what you owe on it. Is gap insurance worth it? See for yourself with the Nyle Maxwell CDJR of Taylor finance team.

What is Gap Protection? 

Gap protection, otherwise known as Guaranteed Asset Protection insurance, pays out the difference between the cash value of your car as stated by your insurance company and any amount of money you still owe on your vehicle. Whether you owe money on a lease or loan, gap protection can help mitigate the financial risks associated with driving a car or getting into a collision.

Is Gap Insurance Worth It for Me?

Once you know what gap insurance is on a car, the next question you’ll probably ask yourself is whether or not gap coverage is really worth it. Most finance and insurance experts agree that purchasing gap insurance can be well worth it for the following reasons: 

• DepreciationHappens: As soon as you drive a new vehicle off the dealership lot, it starts depreciating, which can create the dreaded difference between vehicle value and loan amount that gap insurance covers.
• Accidents Happen: Most accidents happen close to home, and most insurance companies only cover what your car is worth at the time of an accident — not what it was worth when you bought it. As such, you never know when a total loss will occur, and whether your loan will be underwater at that time. 
• TheCost of Gap Insurance is Relatively Low:Gap insurance won’t add too much to your monthly payments. What’s more, it is easy to obtain.

How Do I Buy Gap Insurance?

Looking to buy gap protection for your new or used vehicle? Here are some ways to get it:

• You may be able to buy it for a one-time fee from your dealership or car loan company.
• Your regular auto insurance company may offer it for as little as $20 per year.
• You can get it from a specialized gap insurance company for a one-time fee.

Rely on Nyle Maxwell CDJR of Taylor for Your Finance & Insurance Needs

Here at Nyle Maxwell CDJR of Taylor near College Station, we’re gap insurance experts! If you have any questions about purchasing gap coverage or any other F&I products, be sure to contact us online or call us at 512-218-5300. We’re here to help you with all your automotive needs!