The Importance of Gap Insurance

PERCY SAYS… A large number of people usually find that they are in a terrible situation when they owe a lot of money for a vehicle that they no longer use because it suffered damage that cannot be repaired or was stolen. Note that this happens even after the insurer has paid a claim.

This can take place when you are driving a new car that has not been paid for fully since you are just making monthly payments. The car is then stolen or involved in an accident that results in a total loss.

Even though you have a comprehensive car insurance cover for the car, insurance companies only pay for the car’s current value. Most people realize this when it is too late. The value of new cars reduces significantly after they are driven out of showrooms. This means that after an insurance company values such a car, you are left with a few thousand dollars that you need to pay out of pocket to the company that offered the car loan and that you need to use your own money to do so.

This is the main reason why it is sensible to opt for gap insurance to complement your usual car insurance. Gap insurance is a the kind of coverage that covers the gap that could be a source of stress if a mishap takes place before you complete making payments for your car.

Having this kind of insurance is very important when you are leasing a car. It is impossible to do without it. You will find that many lease contracts require that one takes gap insurance in order to qualify to lease a car. If you find yourself in such a situation, you should shop around as you look for the best deal that you can be able to get from insurers. If gap insurance is included in the lease, it is essential for you to read all the terms and conditions in order to find out how much you will be paying for it.

It is also important for you to know that at times, car leases include a gap waiver. It plays the role of protecting you from paying extra charges if your car suffers damage before you have completed making payments for it. In this case, a gap insurance cover is not necessary. It is also wise to get gap insurance if you have bought a car on your own. This is especially the case if you have purchased an expensive car and you would like to get another one immediately if anything happens to your car.

In order for your gap insurance claim to be honored, you need to have comprehensive insurance that includes collision coverage. It is a fact that most lease contracts require that one takes comprehensive and collision coverage for the car through the entire period of the contract.

It is also essential for you to abide with all the requirements of the company that provides one month insurance deals. You should be careful to comply with small details so that you do not face disqualification due to technicalities. Taking gap insurance is wise and you will be glad that you applied for this insurance if you experience a misfortune before paying off your car lease.

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