Gap Insurance?
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New User
Joined: Jul 2006
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Gap Insurance?
One more week until my new truck is in! My dealer told me to consider Gap insurance for my truck. My question is; is it worth it? I think he quoted me around 600 bucks for it. I ordered a 07 Screw Lariat if that helps.
Thanks
Thanks
Senior User
Joined: Oct 2005
Posts: 201
Likes: 3
From: Churchville, VA
You can get it from your regular insurance carrier in most cases. If you are financing for 60-72 months it is a good idea.
I work in insurance claims, and the people who have it and wreck their vehicle inside the first year and very glad they paid for it. You can probably drop it after the first couple of years.
Just my $.02
I work in insurance claims, and the people who have it and wreck their vehicle inside the first year and very glad they paid for it. You can probably drop it after the first couple of years.
Just my $.02
Postmaster
Joined: Nov 2004
Posts: 2,511
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From: Marion, VA
If you don't have a large downpayment or if you lease a vehicle, you really need gap insurance. If your vehicle is totaled or stolen, the insurance company owes you the actual cash value of the vehicle and if the payoff is more than that, you are responsible for the balance due. It hurts when you total your vehicle and owe more than it is worth but it hurts a lot more when you are an innocent party and you owe thousands of dollars and have no vehicle. Working claims for 31+ years, I found leases to be the worst because you get in with little or no downpayment so the outstanding balance is instantly far more than the value of the vehicle.
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Senior User
Joined: Jan 2006
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From: eastern nc
I know I am probably wrong, but....I thought the purpose of insurance was to make you whole again in the event of an accident. When you buy insurance, don't you buy it based on the cost of the vehicle? If this is the case they (insurance companies) would be responsible to replace your vehicle with one of like condition (miles, options etc.). Gap insurance? Sounds like another way to fatten their purses at the consumers expense.
Sorry, just my opinion.
Sorry, just my opinion.
Tuned
Joined: Aug 2006
Posts: 479
Likes: 1
From: Bartlett, TN
OK, Its like this.
Do you realize that your new vehicle depreciates as soon as you drive it off the lot?
The insurance company is only responsible for the ACV (actual cash value) which if you paid nothing or very little down, and if you financed ext warranties etc, you are what is termed "up-side down". Gap insurance pays this difference. And it does happen. If it never happened.... no one would buy gap and the companies would quit selling it.
make sense?
Do you realize that your new vehicle depreciates as soon as you drive it off the lot?
The insurance company is only responsible for the ACV (actual cash value) which if you paid nothing or very little down, and if you financed ext warranties etc, you are what is termed "up-side down". Gap insurance pays this difference. And it does happen. If it never happened.... no one would buy gap and the companies would quit selling it.
make sense?
Senior User
Joined: Oct 2005
Posts: 201
Likes: 3
From: Churchville, VA
Some companies are starting to replace new vehicles, but certain conditions apply. Insurance is there to make you whole, and the cost of the vehicle does come into play when the premiums are figured, as does your driving record. If you read your policy closely, it is not the insurance companies duty to replace your vehicle or find you one like yours, only to pay you what it is worth or to pay for the repairs.
Gap is like extended warranties. Worthless until you actually have to use them. Then you feel like the smartest person on earth!
Gap is like extended warranties. Worthless until you actually have to use them. Then you feel like the smartest person on earth!
Senior User
Joined: Jul 2004
Posts: 146
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From: Brandon, MS
Gap
Like 1Digger, I work in insurance claims. Our primary goal is to screw little old ladies out of their hard earned money and not pay your claim.
Just kidding, thought I would get your attention. Seriously, I would definately recommend getting the GAP coverage. It protects you in the event you have "negative equity" (owing more on the loan than the value of the vehicle). These trucks drop in value pretty quickly. Your insurance policy is a contract, states that your insurance owes you, at most, the actual cash value of your vehicle (check out KBB or NADA for some ideas as to ACV).
I handled an automobile claim for someone last week on a total loss, the NADA retail on their vehicle was $16500. The loan balance was $27000! Not only did the dealer take advantage of them on the sale but they 'rolled' their prior loan onto the current car which they were already upside down on.
But $600 does sound high. Sometimes they combine an extended warranty into the GAP coverage. Just shop around. My $.02.
Just kidding, thought I would get your attention. Seriously, I would definately recommend getting the GAP coverage. It protects you in the event you have "negative equity" (owing more on the loan than the value of the vehicle). These trucks drop in value pretty quickly. Your insurance policy is a contract, states that your insurance owes you, at most, the actual cash value of your vehicle (check out KBB or NADA for some ideas as to ACV).
I handled an automobile claim for someone last week on a total loss, the NADA retail on their vehicle was $16500. The loan balance was $27000! Not only did the dealer take advantage of them on the sale but they 'rolled' their prior loan onto the current car which they were already upside down on.
But $600 does sound high. Sometimes they combine an extended warranty into the GAP coverage. Just shop around. My $.02.
