Gap Insurance in Pennsylvania | Bankrate

If you’re a Pennsylvania driver with an auto loan or rental car, it’s good to understand gap insurance. Pennsylvania gap insurance can provide drivers in this state with more financial protection after the theft or total loss of their car than if they had only collision and comprehensive coverage. Many of the best auto insurance companies offer differential insurance.

what is differential insurance?

In a nutshell, general asset protection, or “gap” insurance, pays the difference between what you owe on your car and the actual cash value (ACV) of the car if it is destroyed or stolen. With new vehicles, your car can depreciate faster than you can pay back the loan, and without gap coverage, you could lose thousands of dollars after a serious accident.

Reading: How much is gap insurance in pa

how does deficit insurance work in pennsylvania?

so how does deficit insurance work in pennsylvania? there are some important points to keep in mind. First, it’s only available for new cars or cars up to a year old. If you have an older car, even if you owe more than the car is worth, you may not be able to buy gap insurance in Pennsylvania.

Second, gap coverage is not the same as new car replacement insurance. the last type gives you the money needed to buy a new car of the same model as the car you lost. gap insurance has nothing to do with an actual replacement vehicle; It only applies to the amount you owe on your current car loan.

when do you use gap insurance?

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Gap insurance only comes into play if your car is determined to be a total loss after an accident, or is stolen and not recovered. in these cases, you would request to access your gap insurance when you file a claim.

For example, let’s say your 2020 honda civic is destroyed in an accident. The actual cash value of the car is $20,000, but you made a small down payment when you bought it and you still owe $24,000 on the car, including interest. With regular collision insurance, your insurer would cover your claim with a check for $20k (or up to the policy limits), less your deductible. if you have gap insurance, the additional amount required to satisfy the outstanding loan would be provided to the lender.

differential insurance compared to other coverage

Buying differential insurance can be a good idea for drivers who prefer that level of financial protection, but it helps to know when it’s most helpful. For context, consider gap insurance compared to the different types of auto insurance coverages that are commonly included in a standard policy. gap insurance is similar to some other types of coverage, but with a few key distinctions.

where to buy gap insurance in pennsylvania?

Looking for where to buy gap insurance in Pennsylvania, you may not need to look any further than your auto dealer, especially if you financed your vehicle with the dealer. They will often be able to write you a differential insurance policy, although this may not be your cheapest option.

There are also gap insurance companies that can write you a policy, or you could go directly to the company that holds your primary auto insurance policy. this may be your most profitable option, but getting quotes is the best way to determine for sure.

gap insurance companies in pennsylvania

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The first step in looking for gap insurance in Pennsylvania is finding a company that offers it. The following insurers and others have gap insurance available for those with new cars who want to be protected in the event of an accident or theft.

  • plymouth rock assurance: This regional insurer (selling policies in just six states, including Pennsylvania) offers differential insurance in addition to auto insurance.
  • yoder insurance: yoder is a regional insurer that sells policies only in pennsylvania. Although it is a smaller insurer, it also offers differential insurance.
  • Nationwide: Nationwide it is a large national auto, home and other property insurer. gap insurance is also an optional coverage offered by this provider.
  • State Farm: State Farm sells more auto insurance than any other company in America, and their version of Gap Insurance is called Payoff Protector. Anyone who gets a car loan from a state bank (an alliance with us) can buy it, even if their car insurance is with another company.
  • usaa: If you or a member of your immediate family is in the military or a veteran, you are eligible to purchase usaa insurance. The company offers a product they call total loss protection for cars that are less than seven years old and have an auto loan of more than $5,000, which reimburses you up to $1,000 of your deductible.
  • frequently asked questions

    how much does differential insurance cost?

    The costs of differential insurance will be related to the type of car you buy and other factors. if you buy it as part of your car insurance policy, it can cost between $50 and $100 a year. differential insurance purchased from a car dealer will be higher in most cases.

    is gap insurance required in pennsylvania?

    no, you are not legally required to purchase gap insurance in pennsylvania. The state has laws about the type and amount of car insurance you need, but gap insurance isn’t required and is only available to you if you have a newer car.

    what is independent differential insurance?

    There are two ways to purchase differential insurance in Pennsylvania: either as part of your auto insurance policy, or as a stand-alone policy that is not connected to your standard auto insurance. stand-alone policies may be available through gap insurance providers, including dealers or independent finance companies.

    how do you cancel gap insurance?

    To cancel gap insurance, you’ll typically need to notify your policyholder, whether it’s the dealer, a finance company, or your auto insurance company. it may be best not to cancel your gap insurance until you’ve paid off enough of the loan that it’s worth less than the car’s actual cash value.

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