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What is GAP insurance?

What is GAP insurance?

GAP insurance is additional car insurance that covers amounts not covered by typical auto insurance providers.

For example, when you purchase a car, its value immediately decreases. If you get in an accident where the car is totaled, the insurance company will only pay the current blue book value of the car. However, you might owe more than the current value, leaving you with a few thousand dollars to cover on your own. GAP insurance will cover the remaining amount you owe; often it may also cover the deductible of your primary auto insurance.

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