Hello Everyone! I work in the Insurance industry and wanted to share a quick tip about Gap Insurance. If you’re not familiar, Gap Insurance covers the difference between what you owe on a vehicle and what it’s worth if it’s totaled. Dealerships typically charge around $1500 for this coverage, but it only costs them about $500. Next time you’re going through the process, simply tell them, ‘I want Gap, but I know I can pay for it directly for only $500,’ and they’ll usually agree to that price.
Mine is like $5 a month from my insurance. That’s a great tip!
Noor said:
Mine is like $5 a month from my insurance. That’s a great tip!
That’s great! You can always go through your insurance too!
I’ve never had gap insurance or even thought about it. What amount of loan would you need gap insurance for?
Grier said:
I’ve never had gap insurance or even thought about it. What amount of loan would you need gap insurance for?
You usually need it if your loan is something like $50,000 and you can only put down $5,000-$10,000. In some cases, it feels unnecessary. I’d suggest checking the average number of car accidents per year in your area to help make your decision. I live in Houston and accidents happen every 30 seconds, haha!
@Haze
Ok, thanks.
Also, some personal insurance carriers only offer gap insurance for new vehicles. Just a heads up.
I always saw gap insurance as a sign that you can’t really afford the car. Once a car salesman tried to tell me I was legally required to buy it, no matter how much I put down. The dealership apologized, but the guy probably only got a slap on the wrist.
My credit union offers free gap insurance…