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Loan/Lease Payoff Coverage

Lease payoff auto insurance, also called "loan/lease payoff coverage," "GAP coverage" or "GAP insurance," is a type of auto insurance coverage that protects the driver during a specific period of time (typically several months after the purchase/lease of the vehicle) in the event of theft or an accident that renders the vehicle "totaled."After a vehicle has been purchased, the value of the vehicle begins to decline rather rapidly – usually beginning the minute the new owner drives the car off the lot. During the honeymoon period, the value of the car is actually less than the amount owed on the car. If, during this time, the vehicle is stolen or damaged beyond repair, lease payoff auto insurance or GAP coverage will protect the driver by covering the "gap" that exists between the loan amount and the actual value of the vehicle. In some cases, lease payoff auto insurance may also cover the deductible listed on the owner's main insurance policy.If you are leasing a vehicle, lease payoff auto insurance may be included in your monthly lease payment, so it is important to check with the dealership at the time of purchase/lease. States such as New York and several others require lenders of leased cars to build GAP insurance into the monthly lease payment. This means that the monthly payment quoted by the dealership must include GAP insurance.If you already have an insurance provider, ask your current carrier if GAP insurance is already included in the premium. If not, shop for lease payoff auto insurance or GAP insurance here at AutoCarInsurance.org. Get up to 8 free quotes; just enter your zip code in the box above to begin.