Is GAP Insurance Worth It?

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Many drivers worry about being offered unnecessary services and coverage when they’re finalizing the purchase of a new vehicle. After all, almost everyone has heard a horror story or two about the confusing ins-and-outs of the finance process. For this reason, we can’t blame anyone who wonders, “Is GAP insurance worth it?”

Although GAP insurance might not seem particularly important when you’re first weighing your options, we feel that it’s a smart option for the vast majority of Peoria and Bloomington drivers. Get the facts by reading on.

What is GAP Insurance?

GAP is an acronym, and the letters stand for Guaranteed Asset Protection. The asset, in this case, is the value of your new vehicle. Since this coverage fills the “gap” between the amount you paid for the car, and its real value at any given point, it’s easy to remember the definition.

Car Collision Accident

Do I Need GAP Insurance?

Whether you lease your vehicles or buy them, GAP insurance helps to ensure that you don’t get left underwater, making payments on a vehicle that has been totaled or seriously damaged in a collision.

Here, we’ve listed just a few of the main considerations that drivers make when answering the question, “Is GAP Protection worth it for me?”

  • Most drivers insure their new vehicles so they can be compensated if it’s lost or stolen.
  • However, the vast majority of insurance companies will make their payout based on the real value of the car, and not on the amount that you paid for it.
  • Since depreciation happens the moment you drive off the lot, there may be a significant stretch of time where you owe more than your vehicle is actually worth.
  • In the event of theft or collision, you’ll be on the hook for the full loan value.
  • GAP insurance pays out the difference between your loan value and the real value of your vehicle, so you can pay off all loans on a totaled car and move on to something new!
  • Since the cost of GAP insurance is relatively low, we recommend it to all of our drivers.

How Do I Buy GAP Insurance?

Although your options may vary depending on whether you finance with a bank or a dealership, there are usually several easy ways to procure GAP insurance in the Bloomington area:

  • Most auto insurance companies will offer GAP insurance for around $20 a year.
  • Your dealership may even offer GAP insurance.
  • In some cases, you may want to choose an option provided by a specialized local GAP insurance company.

Rely on Sam Leman Automotive Group for Your Finance & Insurance Needs

You’ll have plenty of opportunities to explore more coverage options when you finance with the Sam Leman Automotive Group. The most diligent drivers will take the time to explore their options before they buy, but we can walk you through all the necessary steps! No credit or bad credit? Don’t sweat it. Find out what you need to qualify for an auto loan today.

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