What Exactly is Gap Insurance and Who Needs It?

July 3rd, 2019 by

Have you been thinking about coming in to see us at Toyota South to talk about buying or leasing a new Toyota Tacoma or another model? We carry a full selection of amazing vehicles at our Richmond, KY Toyota dealer location and we also have a knowledgeable customer service team ready to ensure you have a memorable experience. If you are wondering about gap insurance coverage and whether or not this is something that you need, we are happy to help. In the meantime, we have put together some information on this coverage and how it may pertain to you.

Understanding Gap Insurance

When financing your new Toyota car, the chances are good you will owe more than the vehicle is worth when you drive it off of the lot due to depreciation. Should your vehicle get stolen or end up totaled in an accident, your insurance company is only going to give you the fair market value of the vehicle at the time of the theft or loss. Guaranteed asset protection, known as gap insurance or loan/lease payoff, is there to act as a buffer in this situation.

When you have gap insurance coverage, it helps to pay for the difference between the amount that you owe on the vehicle and what it is worth. Without this insurance coverage, you would be responsible for paying off the loan without having the ability to drive your vehicle. Gap insurance generally only costs a few extra dollars a month and you do have the option to discontinue coverage whenever it is no longer necessary to have.

Learn more car buying tips from Toyota South like what’s good mileage for a used car and if you should buy or lease when purchasing a new vehicle with our car buying tips.

Toyota South is conveniently located at 961 Four Mile Road in lovely Richmond, KY whenever you are ready to buy or lease a new Toyota. If you still have gap insurance questions, feel free to call us at (859) 353-6781.

Posted in Finances