You are buying a new or newer vehicle and you know you need gap insurance. The dealer has the paperwork for you to sign and with the stroke of a pen you will be off with your new car and your new gap insurance policy. Or, you bought a new car a few months ago and decided at the time to not purchase gap insurance but now realize that you want it. So, you go online to get an online gap insurance quote. If you have been in either of these situations and decided to follow through with your gap insurance purchase, then you may possibly be paying twice for gap insurance.
Who Wants to Pay Twice for Gap Insurance?
Pay twice for gap insurance? Who wants to do that? No, you don't get double the coverage but only double the payment. How could that happen? Well, it happens when you already have gap insurance coverage through your insurance company and then buy a gap insurance policy either because the dealer has pressured you into it or you just did not realize you already had the insurance.
The Lesson: Always Call Your Insurance Agent First
So, the lesson here is to always check with your insurance company first. You can do this by simply giving them a call or taking a look at your current insurance policy. If you first take a look at your current insurance policy and either think or don't think you have the coverage listed, I urge you to still call your insurance agent. Although insurance policies should be fairly understandable to most consumers, they usually are not and you may assume you have a coverage or miss a coverage that you think you have.
Gap Insurance Look-Alike
Another reason to first call your insurance agent to ask about gap insurance is that insurance companies often offer a form of gap insurance but, it sometimes works a little different than traditional gap insurance and is often called by another name. These coverages that insurance companies offer that are similar to gap insurance are sometimes referred to as "automotive loss protection", "loan payoff coverage", "lease payoff coverage" and "new car replacement." Whatever your insurance company decides to call it, you need to understand how it works and since every insurance company's gap insurance coverage may work a little different, again, you will want to contact your insurance agent to see how their gap insurance coverage will work for you.