GAP Insurance

[Eville]

Hello all, just curious on how many of you purchase GAP insurance for your vehicles. I understand what it is and why to purchase it. Depending on how much they give me for trade in will depend on if any of the remaining balance gets carried over into the new deal. I've always purchased it at the dealer and have heard it's always more than going through your car insurance or third party. I've had Geico since I began driving but they unfortunately don't offer GAP insurance. Anyone know of any reliable insurance or online third party providers where I could just get GAP insurance, at least for the first year or two. I've read some insurance company's require you to be insured with them in order to add GAP. My car's at the dealer and should be awaiting pickup any day now and would like some options before I go in. Any help would be appreciated.

Thanks! :help:

Sponsored

 

[02gtnh]

Talk to your insurance company to see what they would cover. I heard the gap is just a money grabber.

 

[Eville]

Yeah, I've always heard the same. Was thinking about skipping it since depending on the deal, I could put a good amount down, thwarting the depreciation of driving off the lot. Although highly unlikely, I'd hate to get into an accident leaving the dealer. lol! :doh:

 

[Old 5 Oh]

Gap can be worthwhile if you put a small down on a long loan, and you will be upside down for a while. If you are not upside down, gap doesn't pay anything. It covers the "gap" between the value of the car and your loan balance, NOT between the value of the car and what it would cost to replace it. Just had this conversation with my dealer and chose to not buy gap as I will never be upside down.

 

[jgibo]

My salesman told me a woman totaled her mustang the first week. Already has check in hand to replace. Luckily she got gap insurance.

 

[02gtnh]

If I was to get gap, it would be from my insurance company and not dealer. Your insurance will tell you what you will need.

 

[Eville]

Gap can be worthwhile if you put a small down on a long loan, and you will be upside down for a while. If you are not upside down, gap doesn't pay anything. It covers the "gap" between the value of the car and your loan balance, NOT between the value of the car and what it would cost to replace it. Just had this conversation with my dealer and chose to not buy gap as I will never be upside down.

This is exactly why I was debating it. My car is currently worth a borderline between dealer trade in or private sale so may still get some of the previous load amount owed. I was also planning a longer loan amount 60-72 months.

 

[Eville]

My salesman told me a woman totaled her mustang the first week. Already has check in hand to replace. Luckily she got gap insurance.

Yikes! This is what I'm afraid of. :headbonk: So I'd feel better having it, though at a cheaper price than the dealers marked up price.

 

[Old 5 Oh]

Yikes! This is what I'm afraid of. :headbonk: So I'd feel better having it, though at a cheaper price than the dealers marked up price.

Remember, you'd only get a check if your loan balance is greater than than the value of a 1-week-old car. My loan balance will be $20K on day 1, so no one would pay me anything. I was wishing I could buy insurance to cover the gap between the value of a 1-week-old car and the cost of a new car, which is what it would take to replace it. Not available, as far I can find, except maybe as part of your regular car insurance. I have seen one insurance company advertise that they would buy you a new car if you totaled in the first year, and that would be sweet.

 

[Tcnarber]

I can tell you this, since this is one of the products my company provides. GAP through a dealer is no difference that what you can get other places...other than COST. NEVER buy GAP from a dealer. GAP is worthwhile if purchased with little to no down payment. I would consider anything under 10% little. I had a dealer offer me a great deal, his words, GAP for $699. Mind you they gave us 10k on a trade, financed about 10k on a 2012 Focus. imguess he thought I was dumb. All that was going in his pocket.

I work with credit unions, and they are much more reasonable. $250-$300.

 

[Flak]

Remember, you'd only get a check if your loan balance is greater than than the value of a 1-week-old car. My loan balance will be $20K on day 1, so no one would pay me anything. I was wishing I could buy insurance to cover the gap between the value of a 1-week-old car and the cost of a new car, which is what it would take to replace it. Not available, as far I can find, except maybe as part of your regular car insurance. I have seen one insurance company advertise that they would buy you a new car if you totaled in the first year, and that would be sweet.

Liberty Mutual does +1 MY replacement value.

 

[RisingForce]

A great product if you're upside down or if you put zero down payment. If you go for a five or six year loan your vehicle value depreciates a lot faster than the loan goes down.

And like other insurance products it's negotiable. You can roughly get it down to $300 one time fee on a five year loan which is a lot cheaper than going through insurance company.

 

[Andella]

I can tell you this, since this is one of the products my company provides. GAP through a dealer is no difference that what you can get other places...other than COST. NEVER buy GAP from a dealer. GAP is worthwhile if purchased with little to no down payment. I would consider anything under 10% little. I had a dealer offer me a great deal, his words, GAP for $699. Mind you they gave us 10k on a trade, financed about 10k on a 2012 Focus. imguess he thought I was dumb. All that was going in his pocket.

I work with credit unions, and they are much more reasonable. $250-$300.

+1

I use Navy Federal Credit Union. GAP is an additional $199... not a bad deal.

 

[Millgeo5]

+1

I use Navy Federal Credit Union. GAP is an additional $199... not a bad deal.

Same here they gave a good 72mon rate and the gap at $199 is lower than most

 

[Eville]

You guys are awesome, thanks for the input! Sounds like credit unions are the way to go. I'll get a quote and then see how much I can negotiate at the dealer. Sounds more likely I'll end up getting it from a local CU though.

Sponsored