When you decide to buy or lease a new vehicle like a 2018 Jeep® Grand Cherokee, you probably think the hard part is over, but you still have a few things to take care of. You have to let your insurance carrier know that you’re going to get a new car, for example. You also have to decide whether or not you’re going to buy gap insurance.
While gap insurance is a type of car insurance, it’s not the same as your standard auto insurance. Your standard coverage will pay the current value of your automobile if your car is totaled. You’ll notice we said, “current value.” The problem with this is that your vehicle depreciates or loses value over time. This may mean you owe more on your automobile than it’s currently worth.
Gap insurance pays the difference between the balance on your car loan and your vehicle’s current value in certain instances. Gap insurance will kick in if your vehicle is stolen and remains unrecovered, and it will also pay out if your vehicle is totaled due to an accident or theft.
If you lease an automobile, don’t be surprised if you’re required to carry gap insurance. Gap insurance is quite affordable so don’t let that requirement stop you from leasing a vehicle. If you buy a car instead, you can choose whether you’re going to opt for gap insurance.
As Florida Jeep dealers, we can tell you it’s a good idea to get gap insurance when you purchase an automobile from our Jeep dealership near Orlando, FL if:
- You financed your car for a minimum of 60 months or more
- You put down less than 20 percent of your car’s purchase price as your down payment
- Your vehicle is going to depreciate faster than a typical automobile
- Your current car loan includes negative equity from a previous loan
To learn more about gap insurance or to find a new vehicle, visit Fields Chrysler Jeep Dodge RAM today.