You have three main options, but they vary significantly in cost: What Is Gap Insurance and How Does It Work? - Progressive
If you put down less than 20% , you will likely have "negative equity" (owing more than the car's value) for the first few years. do you need gap insurance when buying a new car
If that new car is stolen or totaled in an accident, standard insurance only pays the —what the car is worth today , not what you paid or what you still owe. Gap insurance (Guaranteed Asset Protection) bridges this divide by paying the difference between your insurance settlement and your remaining loan balance. Who Should Get Gap Insurance? You have three main options, but they vary
While not required by law, gap insurance is a near-necessity in several common situations: You have three main options
Your loan term is (36 to 48 months), allowing you to build equity faster than the car depreciates.