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Gap insurance – otherwise known as Guaranteed Asset Protection – is an add-on insurance that motorists can obtain right when they buy a car at the dealership.
Gap coverage works to protect a motorist in the event they face an accident and walk away with out-of-pocket expenses due to the value of their vehicle. A car accident may leave the victim with serious injuries and new debts that can be just as painful, but a gap insurance policy is intended to offset those outstanding costs and act as a layer of protection for drivers with car payments.
At Bert McDowell Injury Law, we’ve worked with countless claimants in similar situations and can aid you through your claim with a gap insurance carrier. These types of claims often involve a two-step process where, first, the claimant must reach out to their standard insurer.
The additional steps and parties involved can make financial recovery feel further away than it should be, but an attorney can keep you on track while maximizing your chances of a successful claim. Schedule a free case review with a Hartford gap insurance lawyer today when you call (203) 633-7449 or contact us online.
A Hartford gap insurance attorney can provide support through key steps of the claim settlement process, including:
When you work with an experienced gap insurance attorney in Hartford, you’ll gain:
This type of insurance is especially important because of how fast new vehicles depreciate in value. Within the first year of owning a car, it will lose about 20% of its value and can decrease another 15% every year for the next four years.
In an accident, the payout for your vehicle’s value may not cover the extent of your loan, leaving you to pay out-of-pocket for an accident that may not even be your fault.
When a motorist first leases a vehicle, their loan or outstanding balance due may be higher than the actual value of the vehicle, but gap insurance acts as the bridge that covers the difference. Ultimately, gap insurance provides protection from unforeseen events that could otherwise leave a motorist vulnerable to financial strain.
Gap insurance is generally inexpensive, too. Because many car dealerships will require this type of coverage to protect their asset, expanding the premium pool, drivers can usually get away with paying $20-$30 a year for their gap insurance policy.
A gap insurance policy is designed to protect a motorist from out-of-pocket costs in the event their standard insurance policy will not cover the full cost of the vehicle’s damages.
This type of policy will cover the difference between what you still owe on your vehicle and the actual cash value (ACV). Before a driver files a claim with their gap insurance carrier, they will go through the standard auto insurance claim process.
An insurer will reimburse a driver for what their vehicle is worth at the time of the accident, minus any deductible. Only after this process can a motorist reach out to their gap insurance carrier for the benefits of their coverage because their final settlement depends on what the standard insurer decides to cover.
Let’s say you owe $15,000 on a car loan, but your vehicle has depreciated in value to $13,000. In the event of an accident, your standard auto insurance carrier will only cover the ACV of your vehicle: $13,000.
This leaves a $2,000 out-of-pocket difference for the driver, excluding deductibles. Having a gap insurance policy can protect a driver from these kinds of expenses.
When you open a gap insurance claim, your coverage will exclude:
Most auto dealerships will advise that a motorist take advantage of the add-on coverage before they even drive off the lot, but it can be especially beneficial to have gap insurance if you are driving:
In order to estimate your vehicle’s worth, you can go to Kelly Blue Book or The National Automobile Dealers Association for a valid assessment. A claim adjuster will also use similar resources to build an estimate.
When you compare this value to your outstanding lease or loan, remember to subtract any deductible you must pay.
While many car dealerships will require drivers to have gap insurance if they lease a vehicle, you can also obtain this type of coverage if you hear about it later. Once you know your car’s worth, you can talk with a representative from a gap insurance carrier to start coverage.
The short answer is “yes.”
If an accident strikes, these extensive warranties will not cover the cost of your loan if it is more than the vehicle’s worth. Gap insurance is the coverage that protects motorists from this financial threat, but it can be added onto a traditional insurance policy, generally within 30 days of purchasing a vehicle.
Your standard auto accident coverage will protect your financial future in other ways by offsetting costs from medical treatment and lost wages, but gap insurance specifically covers financial strain related to an insufficient vehicle reimbursement.
In 2019 alone, traffic crashes cost America $340 billion. A car accident can be an expensive and unfortunate circumstance to experience, but gap insurance can cover your bases when it comes to your investment in your vehicle.
An accident is overwhelming, but the financial implications that follow can be just as severe.
Working with an attorney can alleviate some of the pressure from litigation, as you’ll gain a team of professionals dedicated to advocating for your best interests. Protecting your finances after a crash begins with an initial consultation with a Hartford gap insurance lawyer.
A consultation with an associate from The Bert McDowell Law Firm is completely free and requires no obligation to commit. In this meeting, you and an attorney will map out a general course of action for moving forward, and you’ll have the opportunity to ask any questions or voice concerns about the upcoming legal process.
Schedule a free case review now when you call (203) 633-7449 or contact us online.