Before we begin, it's essential to understand what GAP insurance is: it covers the "gap" between what you owe and the car's value at the time of the accident. If you took out a $30,000 auto loan for your new Toyota vehicle and it was worth $27,000 at the accident, your auto insurance company would pay you $27,000. Your GAP insurance would then kick in and cover the remaining $3,000, saving you the trouble. Now that we've established the terminology and function of this insurance, let us assist you in answering the question, "Do I have GAP insurance?"
Do you have Gap Insurance?
GAP insurance, unlike liability insurance, is not mandated by the state. In most circumstances, if you want GAP insurance, you'll have to actively seek it out or ask for it to be added to your auto insurance policy. There is one exception: if you lease a vehicle, your lease agreement may stipulate that you purchase GAP insurance in the event of a total loss.
Refer to your lease agreement for the Gap Waiver provision
Don't assume GAP insurance is required if you're financing or leasing your vehicle. GAP Waiver Provisions are included in some — but not all — car loan and leasing agreements between borrowers and lessees. Do you know if you have GAP coverage or the provision? Make contact with your lender or leasing firm!
How to buy Gap Insurance?
GAP insurance can be purchased in a few different ways. GAP insurance can be purchased from your car insurance company, an internet insurer that specialises in GAP coverage, or the Beechmont Toyota finance department.
Before you buy the GAP coverage, consider the following:
- Check with your insurance company to determine if GAP coverage is included in your standard policy.
- GAP insurance may be included with your purchase or lease by some finance and leasing providers. Don't you want GAP coverage? Make that clear right away.
- Examine your loan or lease agreement to see if GAP insurance is already included. If you're not sure, ask!