Reader’s Question:

What exactly is gap insurance? I already purchased collision and comprehensive car insurance here in Erie Pennsylvania PA. Do I have to purchase gap insurance as well?

Jasmine

Erie Pennsylvania PA

Hi Jasmine! Did you purchase your car through a loan in Erie Pennsylvania PA? Are you still in he process of paying off your car loan? Is your car leased? If you answered yes to any of my questions, then it may be a good idea to get gap insurance as add-on to you comprehensive auto insurance.

If you bought the car on loan, gap insurance can be pretty handy during the years that you’re still paying off the loan. As you well know, the value of your car depreciates over time as a result of regular use, wear and tear. In case you accidentally total the car or if it’s stolen, your collision or comprehensive auto insurance will pay for the actual, depreciated value of the car. This is expected to be less than your original loan amount from the bank. Gap insurance will cover this discrepancy. Consequently, you no longer have to keep paying for what you have already lost.

If the car was merely leased, in the first place, the same usually applies. The only difference is that it is the leasing company, rather than the bank, which will demand for the full payment.

To learn more about gap insurance and how much it costs in Erie Pennsylvania PA, you can key in your zip code in the form to get free quotes. Getting this from at least five different companies should be a good start.