How does GAP insurance work in NJ?

Gap insurance is an optional coverage, referred to as the Auto Loan/Lease Coverage Endorsement, available to NJM Auto policyholders. This endorsement will pay for some or all of the difference between the balance of a loan or lease on a vehicle and what NJM pays if the car is considered a covered total loss.

Is GAP insurance offered in NJ?

Gap insurance is an optional coverage, referred to as the Auto Loan/Lease Coverage Endorsement, available to NJM Auto policyholders. This endorsement will pay for some or all of the difference between the balance of a loan or lease on a vehicle and what NJM pays if the car is considered a covered total loss.

Is adding GAP insurance worth it?

If there is any time during which you owe more on your car than it is currently worth, gap insurance can definitely be worth the money. If you put down less than 20% on a car, you're wise to get gap insurance at least for the first couple of years that you own it.

What is the difference between full coverage and gap?

If the car is totaled in an accident or stolen, standard car insurance will only pay you the current value, so you'll lose money paying back the original loan or lease. Gap insurance covers this “gap” between the depreciated value of the car and the amount owed on the loan.

Is getting GAP insurance worth it?

If there is any time during which you owe more on your car than it is currently worth, gap insurance can definitely be worth the money. If you put down less than 20% on a car, you're wise to get gap insurance at least for the first couple of years that you own it.

What is covered on GAP insurance?

In the event of an accident in which you've badly damaged or totaled your car, gap insurance covers the difference between what a vehicle is currently worth (which your standard insurance will pay) and the amount you actually owe on it.

How long does gap cover last?

“In most cases, gap insurance is for the life of your loan. This means that until you pay off your loan, your gap insurance will remain active. While every company is different, you'll likely need to call your lender to take gap insurance off your loan.

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