Residents of Norman, OK are required by law to carry liability auto insurance on their vehicles, but they are not compelled to purchase GAP insurance. Many people still choose to do so, as it can provide necessary coverage in the event of an accident. First, we need to understand what GAP insurance is and what it does.
GAP Insurance Explained
GAP stands for guaranteed asset protection, and it is for people who owe a balance on their vehicle that is greater than what their car is worth. This gap in values most often happens, because a vehicle is subject to depreciation the moment the buyer drives it away from the car lot. In insurance terms, this means that the vehicle is upside down in value, and this usually is not a problem until an accident involving a total loss occurs.
After such an occurrence, the insurance company will only pay as much as the total actual cash value, assuming you have collision coverage, and this is the equal to the depreciation subtracted from the sticker price. Oftentimes, this will leave a residual amount due to the lender for which the driver will be held responsible. GAP insurance is designed to keep this from happening, as it is meant to cover these expenses, and it is also an invaluable protection for those who are leasing their automobile.
J. Charles Insurance Can Provide You with Assistance
J. Charles Insurance has faithfully served the residents of Norman, OK, equipping them with the various insurances that they need for their busy lifestyles. We can answer any questions you may have regarding GAP insurance, and it is an honor to do business with you. We encourage you to contact us and to speak to one of our friendly representatives about the right insurance choice for your situation.