What is Progressive Auto Insurance Gap Coverage?

Progressive Auto Insurance Gap Coverage is a type of insurance coverage that helps to bridge the gap between what your car is worth and what you owe on your loan. Basically, if your vehicle gets totaled in an accident and the insurance company does not pay off the full balance of your loan, then gap coverage will pay the difference between the current market value of your vehicle and the remaining balance of your loan.

For example, if you purchase a car for $20,000 and you owe $18,000 on your car loan, then the current market value of your car is $18,000. However, if your car gets totaled in an accident, the insurance company may only pay out the current market value of the car, which is $18,000. In this case, you would be responsible for the remaining $2,000 balance on your car loan, unless you have gap coverage.

Gap coverage is a valuable form of coverage for anyone who is financing a car, especially if you are financing an expensive vehicle. Since cars tend to depreciate in value over time, there is always a chance that the market value of your car will be lower than the amount you owe on your loan. By having gap coverage, you can ensure that you are not left with an outstanding balance on your loan if your car gets totaled.

How Can You Get Progressive Auto Insurance Gap Coverage?

You can get Progressive Auto Insurance Gap Coverage by adding it as an optional coverage to your Progressive Auto Insurance policy. Typically, gap coverage costs around $20 to $30 per year, depending on your particular policy. It is important to note that you must have comprehensive and collision coverage in order to be eligible for gap coverage.

When you are deciding whether or not to purchase gap coverage, it is important to consider how much you owe on your loan. If you owe a significant amount of money on your loan and if the market value of your car is significantly lower than the amount you owe, then it may be a good idea to purchase gap coverage. On the other hand, if you only owe a small amount on your loan and the market value of your car is not much lower than the amount you owe, then it may not make sense to purchase gap coverage.

What Does Progressive Auto Insurance Gap Coverage Cover?

Progressive Auto Insurance Gap Coverage covers the difference between the current market value of your vehicle and the remaining balance of your loan if your vehicle gets totaled in an accident. It does not cover any other types of losses or damages, such as theft or vandalism.

In addition to covering the difference between the current market value and the loan balance, gap coverage also covers the cost of sales tax, license fees, and other fees associated with the purchase of a new car. This coverage is usually limited to a certain amount, so it is important to understand the details of your policy before purchasing gap coverage.

When Does Progressive Auto Insurance Gap Coverage Not Apply?

Progressive Auto Insurance Gap Coverage does not apply in all situations. For example, it does not cover any damages caused by wear and tear or by an act of nature, such as a hurricane or flood. It also does not cover any damages caused by misuse or abuse of the vehicle.

In addition, gap coverage does not apply if you have not maintained the required level of comprehensive and/or collision coverage. In other words, if you cancel your comprehensive and/or collision coverage, then gap coverage will no longer be in effect. Finally, gap coverage does not cover any amounts that you owe that are not related to the purchase of the vehicle, such as late fees or taxes.

Conclusion

Progressive Auto Insurance Gap Coverage is a valuable form of coverage for anyone who is financing a car. It can help to bridge the gap between what your car is worth and what you owe on your loan in the event that your vehicle gets totaled in an accident. It is important to understand the details of your policy before purchasing gap coverage, as it may not apply in all situations. If you are financing a car, then gap coverage is something that you should consider adding to your policy.