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While gap car insurance coverage doesn’t fill in all the gaps as comprehensive practically does, it takes care of gaps in other areas. Leaving gaps in your auto insurance coverage can seem like it is saving you money but can actually lead to more expensive out of pocket expenses than you may be able to cover.
What Texas gap insurance does:
- Gap auto insurance coverage is what makes it possible to secure the difference between what you are paying for a car and what its true value is. Whenever you drive a financed car off the lot, the value is less than the amount you are paying for the loan. It is how companies make a profit on selling cars. The newer the car is the greater the deficit is as a general rule. For any loan the earlier on it is into the loan, the more likely there will be a significant deficit.
- Why this is important is that if something happens to the car and it is totaled out or stolen, you will be left paying that deficit. In other words, the standard car insurance you have will cover paying off the loan only for the value of the car. Whatever the difference is between the value and the total amount owed is what you are still responsible for paying. In other words, you will have to pay out of pocket the difference between the value and the total amount of the loan.
- As you can imagine, the little bit extra you may pay a month to have Texas gap auto insurance coverage is most likely going to be a great deal less than what you would have to pay for the difference for the car value and loan amount. Aside from the fact that trying to come up with that great a difference out of pocket on the spot without any prior notice can be a financially draining if not impossible task. By getting quotes from insurance policy providers competing for your business, you may even find that you can add gap insurance coverage to your policy and still end up paying less than you are now for your standard auto insurance policy.
Taking the Gamble
Many drivers wonder if adding Texas gap car insurance coverage to their policy is worth the extra premium costs. Of course, with auto insurance or any type of insurance you never know if you are going to need it. In fact, even though you pay for it every month, you can only hope you will never need it. Some drivers even take the risk of driving without any type of automobile insurance and run an even higher risk of being stuck with major medical bills and vehicle repair or replacement costs should their luck run out.
Not only that but these drivers who fail to secure any type of car insurance are also breaking the law and running the risk of getting tickets and fines for driving without it. Driving a car without gap insurance coverage is also taking a risk. This is especially true if you are driving a car that is brand new or is in the beginning stages of your loan payments.
While you certainly hope nothing should happen that causes you to be in a collision, you do still have to face the fact that it is always a possibility. If you want to avoid taking the risk of being financially responsible for the difference between your car’s value and the amount of the loan, you owe it to yourself to get your gap car insurance policy organized. At the very least you should get the quotes to do some comparison shopping to see how affordable it really can be, especially when it is as simple as filling in your zip code and having the quotes sent to you. Don’t go another day without the right amount of Texas gap insurance coverage for your vehicle.