If you’re in the market for an automobile, you may find yourself thinking, “I wish there was a Mazda dealer near me who could tell me if gap insurance is worth it.” If you’re curious about whether gap insurance is a smart buy for you, we invite you to reach out to the experts in our Mazda finance center near Millcreek, PA.
Gap insurance is a type of auto insurance that’s different than your standard car insurance policy. If your vehicle is totaled or stolen and it remains unrecovered, your standard policy will reimburse you up to the current fair market value of your automobile. If you owe more than that amount, you’ll have to pay the difference out of pocket to settle your car loan.
When you have gap insurance, you won’t have to pay anything out of pocket because your policy will cover the difference, or the gap, between your car’s fair market value and the balance on your auto loan. Whether gap insurance is worth its modest cost depends on various factors.
Drivers who’ve paid off their auto loan, don’t need gap insurance. Similarly, if you owe an amount that you can afford to pay off comfortably, you don’t need this type of coverage either.
If any of the following applies to you, it’s probably a good idea to buy gap insurance:
- You leased your car
- You put down less than 20 percent when you bought your automobile
- Your car loan is 60 months or longer
- The vehicle you purchased is expected to depreciate faster than a typical automobile
- You rolled a previous loan into your current auto loan
Are you wondering if you need gap insurance? If so, we’ll be happy to help you figure things out. Head over to Auto Express Mazda to talk to the experts in our Mazda financing department now.