You can buy stand-alone gap insurance from many dealerships and lenders when purchasing or leasing a new car. Otherwise, drivers can purchase gap insurance via their standard insurance company, since many insurers offer gap coverage or a similar option like loan/lease coverage. However, if you have car insurance through one insurance company, such as Progressive, you cannot buy gap insurance through a different standard car insurance company, like Geico, since it’s an optional policy add-on.
Stand-Alone Gap Insurance Cost
If your insurance company does not offer gap insurance and you decide to purchase it through a dealership or lender, be aware that your premium will be charged interest if it’s rolled into the loan or lease balance. Gap insurance from a dealership can cost between $400 and $700 in all. However, when gap insurance is purchased through a standard insurance company and added to an existing car insurance policy, it costs an average of $20 to $40 per year.
Stand-Alone Gap Insurance from a Private Company
Gap insurance used to be available as a stand-alone type of coverage from private, third-party companies such as Gap Direct. Through companies like this, the gap insurance would not be directly tied to your loan or lease, nor to your existing car insurance policy. However, Gap Direct is currently not accepting new applications and recommends considering other options such as lenders, insurers, or dealerships.
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