What Are the Benefits of Having Gap Insurance?

When you purchase a gently used vehicle from iAUTOHAUS, you may get asked if you want gap insurance. What is gap protection, and is gap insurance worth it? These are fair questions! Your comprehensive car insurance covers damage to your vehicle outside of an accident. Still, gap insurance covers the “gap” between your vehicle’s value and what you owe on it if it’s totaled. Learn more about the benefits of gap insurance here with iAUTOHAUS in Tempe, and contact us with any questions.

What Is Gap Insurance On A Car?

Let’s start at the beginning. What is gap insurance on a car? Gap insurance stands for “Guaranteed Asset Protection.” More specifically, it is a type of insurance that covers the gap between the current value of your car and the remaining balance of your auto loan. It can be used on any car with a lease or loan. Suppose your vehicle is damaged during a natural disaster or in an accident on Phoenix roads. In that case, gap insurance covers the cost between what your insurance will pay and your car’s current value. Gap insurance covers only the vehicle’s value and not bodily injury or property damage above that amount.

Below are the benefits of gap insurance and what it covers if it is a total loss:

• Vandalism
• Fire
• Theft
• Accident
• Acts of nature (flood, earthquake, tornado, hurricane, etc.)

How to Know if You Need Gap Insurance

Gap insurance is optional, but we recommend buying it if you have an auto loan because it protects your assets. Here are some examples of why gap insurance is worth it for many Scottsdale drivers:

• If your car is stolen or totaled and you owe more than its value, gap insurance covers that difference.
• Vehicle depreciation happens when you drive away from the Chandler dealership, so you need protection!
• Gap insurance is relatively affordable and easy to get from almost any auto insurance company.
• Accidents happen when you least expect it, and gap insurance gives you peace of mind.
• Remember, most auto insurance companies only cover up to the market value of your vehicle when the accident occurs.

How To Buy Gap Insurance

Now that we’ve answered the question, “What is gap insurance on a car, how do you get it? There are several places to get gap insurance, such as:

• Some dealerships or other auto-loan companies offer it
• Most auto insurance companies
• Specialized auto insurance companies will provide gap insurance for a one-time lump sum and fee.

Learn More About Gap Insurance at iAUTOHAUS Today

The benefits of gap insurance will help you drive around Tempe with more confidence, so if you have additional questions, chat with our finance specialists. Feel free to apply for financing online and get your trade-in value before your visit to select your next vehicle!