McKayla Girardin, Car Insurance Writer
No, gap insurance usually does not cover your deductible. Gap insurance typically only pays for the difference between your totaled car’s actual cash value and the balance on your loan or lease, and it does not reimburse you for your collision or comprehensive deductible in most situations.
When Gap Insurance Can Cover Deductibles
Unlike gap insurance from most major insurance companies, gap insurance from Allstate can cover your deductible.
Additionally, gap coverage that was purchased from a vehicle manufacturer may pay for your deductible in certain states. For example, gap insurance from Toyota can cover up to $1,000 of your insurance deductible depending on your location.
Some credit unions offer gap insurance that includes coverage for your deductible, too.
When Gap Insurance Does Not Cover Deductibles
Gap insurance from a dealership, lender, lessor, or car insurance company generally does not cover your deductible. You only need to pay a deductible if you’re filing a collision or comprehensive claim for damage to your car, though. If you file a claim with the at-fault driver’s property damage liability insurance for a totaled car, you won’t need to pay a deductible.
To learn more, check out WalletHub’s complete guide to gap insurance.
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