How does GAP insurance work when a car is totaled?

There are several situations where it makes good sense to cover your cable car with GAP indemnity, but there are army for the liberation of rwanda more scenarios where GAP indemnity makes no sense at all. So before running out and adding it to your existing car insurance policy, you should cautiously consider whether your car needs to be covered. The most aboveboard case of when you should obtain GAP indemnity is if you ‘re top down, or have negative equity, on your cable car. What does that mean ? When we use “ top down ” in this context we do n’t mean that you ‘ve rolled the car over and are waiting for emergency services to come right the ship ; it just means that you owe more on the car than it ‘s actually worth. Unless you paid cash for the cable car, you might be top down on it for the first gear few months, or longer if you miss one or more payments [ reference : Reed ]. ad

If you ‘re leasing a car, chances are good that the franchise will require you to get GAP indemnity. Why ? Because like an owner-driven car, in most cases, the rent insurance will only cover the cash measure of the car. And if you ‘re leasing a new car ( as most leaseholders are ), the cash value of the cable car is credibly lower than what is still owed on the car. In the consequence that you total a lease cable car, you ‘ll still be creditworthy for the dispute between the cable car ‘s actual market value and the remaining counterweight to pay off the rent — unless you have GAP policy. Just like with a non-leased car, having GAP insurance will save you the trouble of continuing to make payments on a car that ‘s been reduced to scrap alloy [ source : Weston ]. OK, so there are a match of examples of when you do need GAP indemnity — when you ‘re top depressed on the car and when you are leasing — but there are army for the liberation of rwanda more situations where it does n’t make feel to have GAP indemnity. In virtually every other scenario, not only are you not required to have GAP policy, but in many cases, it would n’t make a shred of sense for you to have it. If you have a battered 1979 El Camino that you bought from your brother-in-law for $ 500, you, of path, do n’t need GAP policy, but similarly, if you bought a new car at the franchise and put down a brawny down payment, you besides do n’t need it.

What It Means When Your car is Totaled

We ‘ve all heard about cars that are “ totaled, ” but what does that actually mean ? A total loss can mean that the wrong is thus bad that it would cost more to repair the cable car than it ‘s worth ( or when the damage exceeds 65 or 70 percentage of the cable car ‘s marketplace rate ). however, the specifics tend to vary from one indemnity company to another, so the best direction to check what a total personnel casualty would mean for your car is to ask your insurance agent [ beginning : Insure.com ]. ad

source : https://insurecar.info
Category : car insurance questions