Why You Need to Have GAP Insurance When Leasing a CarA very important thing you need to have when leasing a car is GAP insurance.
GAP stands for Guaranteed Asset Protection (also referred to as Loan/Lease Gap Coverage) and it's a type of insurance that protects you from owing any money in the event that your car is totaled or stolen.
It's a minimal fee and many leases actually include it at no cost, but you need to make sure it's on the contract.
The reason you need GAP insurance is because most insurance providers pay out the actual cash value of the vehicle if it's stolen or totaled.
Since cars depreciate quickly in the first 3 years, chances are you will owe several hundred or even several thousand dollars to the leasing company to make up for the difference.
This is a simple thing to check, but it could save you a lot of money.
Each week, I'll keep you up-to-date on the latest car deals and news that might affect your purchase. This includes...
- Best Rebates, Incentives, and Lease Deals
- Latest Car Buying Scams and Tricks
- The Best & Worst Time to Buy a Car
- Which Cars You Should Avoid