Does Nationwide offer gap insurance?

Gap insurance is an optional type of car insurance coverage that pays the difference between the balance on a car loan or lease and what the vehicle is actually worth if it is declared a total loss. Gap insurance ensures you don't have to make payments on a car that is no longer drivable.… read full answer

Gap coverage usually only applies when a driver has comprehensive and collision insurance. Collision or comprehensive coverage will pay out the car’s value if it’s a total loss, and then gap insurance fills in the rest.

Gap Insurance Example

Imagine you buy a $50,000 car with a down payment of $10,000. Three years later, the car is worth $20,000, but you still owe $24,000 on the loan. If the car is totaled in an accident or stolen and declared a total loss, your normal insurance policy will pay $20,000, or the car’s actual cash value (ACV), minus your deductible.

If you don’t have gap insurance, you’ll still owe $4,000, and you’ll still have to pay off the car even though you can’t drive it. But if you do have gap insurance, it will pay the $4,000. Some gap insurance policies even pay your deductible, though most do not.

It’s also important to keep in mind that the money you receive from gap insurance will go to your lender or lessor, not toward your purchase of a new car. If you’re interested in coverage that will help you buy a car in the future, look into new car replacement insurance instead.

Finally, you can buy gap insurance from a dealership, bank, credit union, or car insurance company. It’s not legally mandated in any state, though car dealerships will sometimes require it on a leased or financed vehicle. If you sell a car, pay it off early, or trade it in, you can usually receive a gap insurance refund.

Yes, Progressive offers gap insurance for about $5 per month, on average. If your car is totaled, Progressive's gap insurance, also called loan/lease payoff coverage, covers the difference between your loan balance and what your car is worth, minus your deductible. Progressive gap insurance will pay as much as 25% more than your car’s depreciated value.… read full answer

Let’s say you finance $30,000 for a new car, which is now worth $20,000. You total your car and find that you still owe $25,000 on the loan. Full coverage only pays up to your car’s depreciated value—$20,000. That leaves you with a $5,000 difference. If you carry gap insurance, Progressive will pay the complete $25,000 balance, minus your deductible (usually $500 or $1,000).

You might consider Progressive gap insurance if there is a significant difference between your car’s actual cash value and what you owe on a loan used to get it. In particular, if you just bought a new car (especially with a low down payment) or are financing a vehicle for more than 48 months, you might want gap insurance. You must carry comprehensive and collision coverage to add gap insurance to a Progressive policy.

No, Geico does not offer gap insurance. Unlike seven of the top 10 car insurance companies, Geico does not sell gap insurance, a specialty type of coverage that pays for the difference between a totaled car’s value and the driver’s loan or lease balance.

You have several options if you’re a current Geico customer and are looking for gap insurance. You could … read full answerswitch insurers and purchase a policy from a company that does offer gap insurance (or loan/lease payoff coverage, which is similar), like Nationwide or Progressive. You could also maintain your policy with Geico and purchase gap insurance from a dealership or a stand-alone company. However, it’s worth noting that dealership gap insurance is often the most expensive option, since it’s usually rolled into your loan and charged interest.

For more information, check out WalletHub’s complete guide to gap insurance.