Gap Insurance California Residents Need
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UPDATED: Feb 2, 2012
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What many drivers are not yet aware of is that with gap insurance California residents can protect themselves on the roads much more. Of course, to know this you would have to know what gap insurance is or get a better understanding of what it can do for you. You may think you have all the coverage you need but may be settling for less than you should have.
While everyone likes to save money, cutting corners when it comes to your auto insurance can be a risky gamble. In fact, it can end up causing you more financial hardship in the long run by not having the gap insurance California drivers should have. When you get your quotes for gap insurance from policy providers competing for your business, you may even find you can add gap coverage without paying more than you are now for your current auto insurance policy.
Before deciding on a policy including gap insurance, California drivers should know a thing or two about this type of automobile insurance.
- Gap insurance does cover a gap in your policy protection, but GAP actually stands for Guaranteed Auto Protection. This type of policy does, however, help fill in the gaps you standard auto policy may not cover.
- Gap insurance is most important in cases where you are paying on a financed car. This is most important in the early stages of the loan or for any duration where the value of the car is less than the amount of the loan .
- Gap insurance is what covers that difference between the value of the car and the amount of the loan. If you were to total the car or if it were to be stolen, the value you would be compensated for would be less than what you are paying for. In other words, the remaining balance would be yours to handle from out of pocket.
Other Instances Where Gap Helps
The main type of driver who signs up for gap insurance is one who has recently purchased and financed a brand new car. The truth is in the beginning of almost any car loan, regardless of the age of the car, once you drive it off the lot in those first few months the value of the car is always less than the amount you are paying. For this reason it is crucial to have gap insurance California drivers. In fact, some lenders may require it.
You may also need gap auto insurance coverage if you are leasing a vehicle. Also if the trade in car you are bringing in is already upside down in value, then you will be getting into your new vehicle with the loan amount greater than the value of the car right away. To protect yourself against these problems, enter your zip code and get your rates today. By getting gap insurance, California drivers can be assured they have all they need in protection while on the open road.